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Burlington Credit Rating Enhanced

Burlington Mayor Miro Weinberger discusses credit rating as BED Director Neale Lunderville observes
Pat Bradley/WAMC
Burlington Mayor Miro Weinberger discusses credit rating as BED Director Neale Lunderville observes

Burlington Mayor Miro Weinberger announced this morning that Moody’s Investors Services has upgraded the city’s credit rating by two steps.
The boost in Vermont’s largest city’s credit rating brings the city to a A3 rating with a stable outlook.  The city has not had an A rating from Moody’s since 2011.  Mayor Weinberger called it an important move for the community.   “When you combine this upgrade with the upgrade from last March we are up three steps in total.  And that does a few things.  It gives the city of Burlington now an A rating.  It means we have a low credit risk.  It puts us back where we were as a city prior to the dramatic three step downgrade that happened in June 2012 just a couple months after my new administration had come into office.  And it puts us halfway back to where we were as city in 2010 when the Burlington Telecom litigation began.”

The mayor expressed pride that the city council and department heads were able to make progress toward fiscal stability without dramatic service cuts or major tax increases.  He expects the rating upgrade to result in immediate savings of nearly $450,000 in debt refinancing due in April.
Weinberger also credited city residents for helping to obtain the two-step jump.   “A key step in getting here was the Fiscal Stability Bond that the voters passed in 2012. The voters stuck with that commitment in additional elections where they made it clear that it was a priority for them that Burlington’s financial reputation, financial name be restored.”  

Weinberger says this upgrade is one of his administration’s biggest accomplishments since he first took office in 2012.   “A lot of people knew there was something that needed to be turned around with respect to the city’s finances. We didn’t quite know how bad it was until that June 2012 downgrade that put us on the edge of junk bond status.  But it was broadly understood in the community that there needed to be some kind of change. We’ve been steadily chipping away at it for these now almost four years and this credit rating upgrade I think is a reflection that we have been able to come together as a community and bring that about.  It is an issue unlike many others where you can directly affect people’s pocketbooks.”

Ward 6 City Councilor Karen Paul, a Democrat, characterized the Moody’s upgrade a “big deal” for Burlington.  “It’s very rare that Moody’s does upgrade two notches so that is a pretty big deal. Our ability to realize our hopes and dreams as a city is enhanced and really made possible by a really stellar credit rating because it costs us less.  So this is a really big day for Burlington.  A year and a half after I was elected the city’s credit rating started to plummet and we’ve been digging out ever since.  It doesn’t happen overnight. But I think that in view of how Moody’s tends to function that we’ve made huge strides in a relatively short period of time.”

The Moody’s report indicates the upgrade reflects three consecutive surpluses and a commitment by city management since 2012 to fiscal responsibility.  The report notes that Burlington’s $4.3 billion tax base is stable due to its diversity.  
 

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