A new long-term bond rating by Standard and Poor’s Global Ratings will help New Hartford taxpayers save money, New Hartford City Supervisor Paul Miscione said.
On March 31, S&P assigned its AA-/Stable long-term rating to the city’s $9 million Series 2022 General Obligation Public Improvement Bonds, while affirming its AA issuer credit rating and its long-term ratings on the city’s existing general obligation debt.
“Positive bond ratings help taxpayers earn lower interest rates because of the demand for bonds that are sold in the market,” Miscione said.
The city’s faith and credit covenant, payable from revenue from the collection of ad valorem taxes levied on all real estate within its borders, secures the bonds, S&P said.
“New Hartford historically produces balanced operations, which continued in 2020, despite the impact of temporary revenue losses due to the pandemic,” S&P said in its report. “Due to the city’s location to several transformative economic development projects in the healthcare and technology sectors, management expects residential growth to reverse previous trends of population decline.”
S&P said the outlook for the rating was “stable”.
The credit bureau said the city’s status as the top sales tax generator in Oneida County helps New Hartford continue to have a strong commercial and retail presence.
According to S&P, preliminary sales tax revenue projections for all city funds are 29% above budget levels, further stabilizing city finances.
“Based on the city’s track record of balanced operations and conservative budget assumptions, we believe financial performance will remain stable over the next two years,” S&P said.
City officials plan to use the proceeds from the bond, along with approximately $250,000 of available funds, to redeem $6.8 million of existing bond anticipation notes that matured in late April and use $2.5 million to permanently fund new capital projects and minor purchases.
Ed Harris is the Oneida County reporter for the Observer-Dispatch. Email Ed Harris at [email protected]