City gets third AAA rating
Published 7:07 pm Thursday, October 3, 2019
The city of Suffolk learned Thursday that it has achieved its third AAA rating from Moody’s Investors Service, according to a city press release.
Moody’s joins Fitch Ratings and Standard & Poor’s Rating Service in bestowing this designation on the city.
“We are ecstatic that we’ve finally received this ambitious achievement we’ve worked so hard to attain,” Mayor Linda T. Johnson stated in the press release. “As a result, our sound and fiscally-responsible financial policies will certainly continue to benefit our citizens and allow us to maintain the high levels of services they deserve and expect of their government.”
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Like an individual’s credit score, the bond ratings for a municipality determine the interest rates it pays on its debt. The AAA rating allows the city to borrow at lower interest rates, thereby saving millions over the long term.
The city received its first AAA rating upgrade from Standard & Poor’s in 2014, with Fitch following suit in 2015, the press release stated. The city “has been working tirelessly to earn this highly sought after final financial achievement.”
Moody’s noted that the city’s General Obligation Bonds have been revised to stable from positive and reflects on the continued growth and diversification of the city’s sizeable tax base, healthy resident income levels, strong and stable fund balance and liquidity supported by formal fiscal policies and conservative budget assumptions, as well as manageable debt and pension burdens.
The rating upgrade reflects Moody’s expectation that the likelihood is that the city’s tax base and resident income levels will continue to improve and that reserves and liquidity will remain strong due to management’s conservative budget assumptions and formal fiscal policies.
Only a handful of cities in Virginia have received the top rating status from all three rating agencies.