Standard & Poor’s recognized Suffolk’s consistent and stable operations, which support already very strong financials. “The City maintains strict adherence to its financial policies that promote fiscal stewardship.” “The city continues to add new and expanding businesses and residential growth and development, which facilitates a healthy local economy, provides job and wage growth, and raises household income levels,” Hansen said.
Suffolk’s finances are also noted to be strong and support official fiscal policies and conservative budget assumptions. Moody’s rating reflects the city’s continued growth and tax base diversification, including stable income levels for residents, according to Franklin. “The city also strives to keep cost growth moderate within available resources,” continued Hansen, “and does not budget for vacancy savings, which provides flexibility to cover unplanned costs that occur during the year.” This results in a greater chance of meeting or exceeding revenue projections and improves the chances of year-end surpluses, which are necessary to maintain a healthy reserve balance in the event of unplanned expenses, economic downturns or emergencies. “Instead of projecting a best-case scenario for revenue growth in developing the annual budget that may or may not materialize, the city is being more realistic in its revenue projections. “The city maintains a conservative approach to revenue budgeting and expense growth,” Hansen said. In its notice to city officials, Fitch said the city’s ability to raise revenue and solid spending flexibility support a superior level of inherent budget flexibility and that Suffolk has robust reserve balances that maintain a high level of financial sustainability. The borrower is then required, depending on the terms, to repay the principal - that is the amount borrowed - of the bond on the maturity date, as well as interest over a specified period of time, according to online data. In finance, a bond is a type of security in which the issuer or debtor owes the holder or creditor a debt. It also provides assurance that the city has high quality bonds, with the least amount of risk, and that both principal and interest on the bonds will be paid on time and in full. The superior rating also represents the overall creditworthiness of Suffolk’s state bonds, according to William Franklin, media and community relations, city of Suffolk. Fitch Ratings is the latest to confirm this with its announcement at the end of July. “Some examples of capital improvements include school replacements, road improvements and repairs, and maintenance of city buildings and facilities, all of which contribute to the quality of life for the citizens of Suffolk.”įor the fourth year in a row, the city of Suffolk’s three bond rating agencies - Fitch Ratings, Moody’s Investors Service and S&P Global Ratings - have affirmed the city’s AAA bond rating, signifying that the city has excellent credit standing and that its future financial outlook is stable. “Having a strong bond rating allows the city to borrow money for capital improvements at the lowest interest rates available in the financial market, saving the city and its taxpayers millions of dollars in interest payments over time,” said Tylen Hansen, finance department of Suffolk Director. In the case of the city of Suffolk, its credit is excellent, meaning that when city officials need to borrow money for community improvements and development, it’s not a problem. News herald subscription.Look at it this way: A city’s bond rating is like a person’s credit rating-the better it is, the more you can do.
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