City’s ‘credit score’ sees another upgrade

The city has achieved an upgraded credit rating from one of the three bond rating agencies for the second year in a row.

The announcement came shortly before City Council’s regular meeting on Wednesday, and it was celebrated during the meeting.

“This made my day,” Mayor Linda T. Johnson said. “I don’t even know what to say.”

The most recent upgrade came from Fitch Ratings, while last year’s came from Standard & Poor’s. The Standard & Poor’s rating was Suffolk’s first-ever rating at the top of the scale.

That leaves Moody’s as the final agency that has not yet rated Suffolk at the top. Its current rating for the city is one step down from the pinnacle, and a rating announcement from it is expected this month.

Like an individual’s credit score, the ratings affect the city’s ability to borrow money and at what rate it can be borrowed. But unlike an individual’s credit score, a lot more goes into the rating than just financial statements.

Johnson said the agencies’ visit to Suffolk last week included a lot of business partners who raved about the city’s Economic Development team. They also got to meet members of City Council and talk to department heads. In some years, city officials simply visit the agencies at their New York headquarters, but this year was different.

“By them coming to Suffolk, they got to touch it, and feel it, and smell it, and lo and behold, they liked what they saw,” Councilman Mike Duman said, noting that it’s easier to “sell a product” when someone can touch it.

“It was a result of a process that was initiated over 10 years ago,” Duman added. “It didn’t happen overnight.”

Councilman Roger Fawcett said the bump will help the city with needs, including two new schools it will be building soon.

“Without those, the things we try to do in this city would be so priced out we wouldn’t be able to get there,” he said. “You don’t get this just by accident. It comes from being real dug in on your everyday operations and expenditures and management styles and so on.”

David Rose with Davenport and Co., the city’s financial adviser, told council members the ratings agencies commented positively about the city’s financial results, management team and financial staff, among other things.

“They think you’re on the right track,” he said. “We want to continue on that path.”

The City Council also voted unanimously to approve issuing about $28.6 million in new debt for general government and schools, as well as $16.3 million for water and sewer and refuse and solid waste projects.

An as-yet undetermined amount of refinanced bonds also could be sold with the new bonds, anticipated to take place in the first full week of July, depending on how favorable interest rates are on that day.