Top credit-score streak continues into 12th year
The city is celebrating its dozenth year in a row with a top credit rating from each of the three top rating agencies, an announcement City Manager Robert W. Healy made Monday to city councillors at their regular meeting.
The councillors offered their thanks in turn to Healy and his financial team, including Louis Depasquale, assistant city manager for fiscal affairs, and David Kale, budget director.
“In really relatively difficult times we fall into an elite group of 30 in the country,” Mayor David Maher said.
Councillors believed the number had fallen from 33 last year, although it was reported last year that the number nationwide was actually 23. Memories that financially troubled California were off the list entirely last year were certainly faulty; Santa Monica and Manhattan Beach were and are on the elite list.
Having a good credit rating allows communities to sell (or, actually, loan out) bonds to pay for large projects, promising to pay interest and, when the bond expires, return what the buyer (or borrower) paid. The higher the bond rating, the better investors feel about their chances of getting their interest on time and money back, so top scores make Cambridge offerings appealing. That guarantee of repayment makes Cambridge so appealing that it can pay lower interest and still draw in investors.
The amount the city saves on paying low interest on its loans wasn’t known exactly, but Depasquale assured the councillors and city that “we’ve saved a lot of money. Millions of dollars, no questions about it.”
The city’s plan is for continued bond offerings this year to pay for high school renovations and sewer reconstruction — as a way to lure businesses, in addition to keeping residents content, Healy noted — and for Danehy Park field turf replacement and renovations to turn the old Central Square police station into a home for the Cambridge Housing Authority, Multi-Service Center and Community Learning Center, a project expected to take about three years and cost $14.5 million.
“It’s a combination of good projects,” Healy said of expected results of the bond offering.
While councillor Ken Reeves might have been fishing for compliments by asking about the salutary effects a “very stable government” had on the credit rating, Tim Toomey was certainly sounding a note from recent debate about the departure of Vertex Pharmaceuticals from the city by stressing the importance of a “diverse and stable tax base. When we have companies moving out of the city, that raises alarms,” Toomey said. “When they leave and take employees with them, that threatens the tax base.”
Even his warnings were draped in congratulations for the city’s fiscal team.
Denise Simmons sounded the ultimate note of cheer before the council went into closed-door session to talk about buying threatened community gardens in North Cambridge:
“Let me join the chorus,” she said, noting that because of the stewardship of Healy, Depasquale and Kale, “we’re not laying people off, we’re rolling out programs that help.”
“We are in a better place,” Simmons said.
This post will be updated.