Conservative fiscal management key to improvement
ANSONIA- Mayor David S. Cassetti and his team have successfully secured a bond rating upgrade for the City of Ansonia.
Standard and Poor’s has issued the City a rating of AA, up from its prior AA- rating.
Ansonia has been rated at AA- by Moody’s since before Cassetti took office.
The mayor’s team has since focused on smart and conservative fiscal management to improve the financial condition of the City.
Examples include:
-Careful oversight of municipal spending;
-Leveraging the fund balance to pay down existing debt while keeping the balance at an unusually high rate;
-The formulation of a 5 year capital plan;
-Adoption of new financial polices and practices;
-A commitment to fund City pensions at the Annual Required Contribution amount, for the first time in a decade; and
-Maximization of municipal revenue from a variety of sources (i.e., increase in tax collection rate).
Additionally, Cassetti has adopted an aggressive approach to economic development, resulting in a whirlwind of business investment within Ansonia, particularly downtown.
This, combined with long overdue investments in infrastructure, such as the reconstruction of Wakelee Avenue, has led to a very positive economic outlook for the City.
Given the positive achievements of the past two years, Cassetti and his team decided the time was right to target a bond rating upgrade.
The Mayor, Sheila O’Malley, Corporation Counsel John P. Marini and financial consultant Barry Bernabe traveled to Standard and Poor’s in Manhattan last Tuesday to make the case for a rating upgrade.
The team shared all of the positive news from Ansonia with Standard and Poor’s rating experts, from the Farrel-Pomini relocation to the crop of new businesses opening on Main Street. They also talked about Ansonia’s financial health and practices.
Just today the City was informed that the effort was a success.
Standard and Poor’s has elevated the City’s credit rating to AA, which is just two notches from the highest rating possible from S&P.
The report from S&P – a global rating agency - indicates that Ansonia new rating “reflects the City’s very strong budgetary flexibility and favorable and liquidity profile, all supported by its strong management team.”
Further, the report states that “as part of its economic development, the City has been proactively working with employers and developers in order to attract new businesses and expand current ones. The City recently opened a new industrial park for Farrel-Pomini which is headquartered in the City, and other manufacturers in order to expand their operations and create new job opportunities.
The report continued that Ansonia’s “downtown area continues to grow and expand.”
Ansonia Corporation Counsel John P. Marini noted that Ansonia’s rating upgrade cuts against the grain: “The State of Connecticut was recently downgraded by S&P to AA-, which means the City of Ansonia has a higher bond rating than Connecticut itself!
Also, nearby New Haven was recently downgraded into the “B” range.
“The hard work of Mayor Cassetti’s administration is allowing Ansonia to beat the odds and exceed expectations.”
The S&P report indicates that the rating agency “does not expect to change the rating within the two year outlook horizon.
“Should the City’s wealth and income indicators improve to stronger levels, while maintaining its very strong reserve position through strong budgetary performance and a favorable debt profile, we could raise the rating.”
The Mayor congratulated his team on their efforts to achieve the bond rating increase for Ansonia’s residents.
“This rating increase is rock solid evidence from an impartial third party that Ansonia’s financial condition is stronger than ever,” said Cassetti. “It is proof that Ansonia is moving in the right direction.”
Cassetti added: “My team will remain committed to smart and conservative fiscal practices for the benefit of our City and its taxpayers.”
Readers may be interested in learning: What is the practical impact of the ratings increase?
Sheila O’Malley, the City’s Economic Development Director, explained “the rating increase is the equivalent of obtaining a high credit score. It means that the City can borrow more funds at a lower rate of interest. It means Ansonia will be paying back its debt at a lower rate than communities with a higher bond rating. Ansonia has therefore gained a tremendous advantage going forward.”
“The rating increase will save hundreds of thousands of dollars on interest payments for our debt,” Cassetti said. “This is a tremendous victory for Ansonia."
This is taken from a press release from Cassetti's office.
