Murray: Surprise bond rating bump means substantial savings

Murray: Surprise bond rating bump means substantial savings

CUMBERLAND – S&P Global Ratings has again upgraded the town’s bond rating, a surprise boost, said Mayor Bill Murray, which should save the town significantly as it borrows money for a new $12.5 million public safety complex. Better bond ratings mean lower interest rates.

Murray called it a “great day” when he heard about the news last Friday, saying it’s “huge” news as the town heads toward securing the bonds for the complex this fall.

“This upgrade from S&P is a clear indication of the continued improvement in the town’s financial strength,” said Murray.

The mayor told The Breeze he had been told to expect S&P to maintain the town’s rating, and was quite surprised to learn that the rating agency had upgraded the town’s general obligation bonds to “AA+” with a stable outlook. He couldn’t immediately estimate how significant the savings will be.

The new rating is four steps higher than it was four years ago, said Murray.

The upgrade “reflects S&P Global Ratings’ opinion of Cumberland’s stronger financial operations and its demonstrated track record of maintaining strong available fund balance, and consistently balanced general fund performance through several years,” reads the report. “In addition, the town’s stronger economic profile, predictable revenue makeup, limited long-term liabilities, and its conservative management practices will likely result in the town maintaining steady financial operations over the long-term and through various economic cycles.”

Murray said he’s proud of what the town has been able to accomplish. A higher bond rating means less risk to investors, he said. Lower interest costs on future bond issues “is good for the taxpayers,” he said.

The review was conducted as part of the town’s regular surveillance of the town’s credit.

Comments

Keep up the good work!!

I am very proud to see an article like this. It is an achievement that is no small feat. The Town is as it has been, going in the right direction. Is everything perfect, of course not, but long term... This Town is in a very good fiscal position which is a great benefit to its residents and should make it the envy of many other towns. My hats off to everyone who puts the work in on a daily basis to keep Cumberland moving. Well done!!