Each of the three major rating agencies has reaffirmed the city of Norwalk’s triple A bond rating with a stable outlook, Mayor Harry Rilling announced.
The city sought the ratings in advance of a $35 million bond sale planned for July 18. That sale will finance $20,867,330 in city capital projects, $8,477,470 in school projects and $5,655,200 for urban renewal/redevelopment projects, the mayor said.
The Aaa rating from Moody’s and the AAA ratings from Standard & Poor’s and Fitch represent the highest ratings awarded by each of the agencies. Rilling’s office said that as a result of “carrying the best credit rating available, Norwalk taxpayers are assured of receiving the most favorable interest rates available in the market when the city issues bonds to finance capital projects.”
The city expects to save $781,000 in interest expense, compared with the rates that the city would achieve if it held a lower double-A rating.
According to the Standard and Poor’s report, “We view the city’s management as very strong, with ‘strong’ financial policies and practices under our FMA (financial management assessment) methodology, indicating financial practices are strong, well embedded, and likely sustainable.
“Norwalk’s budgetary performance is strong in our opinion,” S&P stated in a release, adding that it was unlikely to revise the rating during its two-year outlook period.
According to Moody’s, “The Aaa rating reflects the city’s healthy financial position and improving fund balance, supported by comprehensive fiscal policies, conservative management practices, as well as manageable debt and pension burdens. The rating further considers the city’s strategically positioned local economy and stable sizeable tax base supported by a significant development pipeline.”
Fitch said that “the city will continue to maintain strong reserve levels throughout an economic cycle given its historically stable revenue performance, high degree of inherent budget flexibility, and demonstrated commitment to maintaining sound reserves within policy levels of 7.5 percent to 15 percent of revenues.”