Standard & Poor's Ratings Services said it raised its rating on the city of Fitchburg, Mass.' general obligation bonds to A-plus from A-minus based on its recently released local GO criteria.
The outlook is stable.
A pledge of the city's full faith credit secures these bonds.
"The rating reflects our assessment of the Fitchburg's economy as adequate, with access to the broad and diverse economy of Worcester County," said Standard & Poor's credit analyst Apple Lo.
Other factors include the city's: strong budgetary flexibility, with available general fund reserves above 8% of expenditures for the past several years and no plans to significantly spend them down; strong budgetary performance overall, with a surplus, which management attributes to cost savings achieved primarily through departmental reorganization, spending freezes, labor union concessions, and attrition and hiring freezes; strong liquidity,and strong access to external liquidity; standard management conditions, indicating that the finance department maintains adequate policies in some, but not all, key areas; and good debt and contingent liabilities profile.
"The stable outlook reflects our view of the city's continued consistent financial performance and underlying economy supported by good financial results," Lo added. A consideration of a positive rating action over time would require further actions to mitigate the effects of the city's long-term liabilities, in addition to Fitchburg continuing to maintain balanced operations, stronger reserves, and stronger economic indicators. With these reasons, it does not expect to change the rating within the two-year outlook time frame.
