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Norwich – Crediting Norwich for having ?strong? and ?very strong? budget and debt management, a budget surplus and a ?stable? economic outlook, Standard & Poor?s Rating Service announced Friday it has upgraded the city?s bond rating to AA.
The upgrade will apply to the refunding of $6 million to $7 million in bonds that date back to 2004 and 2005, as well as to the $12 million in new bonding to cover the city?s ongoing natural gas line expansion, road and drainage work and the recent demolition of the former Buckingham and Greeneville school buildings, city Comptroller Josh Pothier said.
The bond upgrade is expected to save the city about $276,000 in interest payments over the life of the bonds, according to a press release from Standard & Poor?s.
The rating service said Norwich has ?strong budgetary flexibility? with an audited 2013 available reserve at 9.8 percent of total annual expenditures, and also cited the city for last year?s strong budget surplus of $560,000. The rating agency said the city has ?very strong? cash levels to cover both debt and budget expenditures and said the city has a ?low overall net debt burden as a percent of market value.? Pothier said city officials also sought a bond review from Moody?s bond rating service and received a renewal of the current AA-2 bond rating from that agency.
He credited the City Council for supporting fiscally conservative practices over the years that resulted in the strong fund reserve.
?The stable outlook reflects our view of the city's adequate budgetary performance and strong budgetary flexibility,? the Standard & Poor?s announcement said. ?The stable outlook also reflects our view of the local economy's ongoing development, and access to large employment centers throughout southeastern Connecticut. We do not expect to change the rating in our two-year outlook horizon as we expect that the city will continue to maintain at least adequate budgetary performance and flexibility in the near term.?