Buffalo, N.Y. was upgraded one notch to AA-minus by Fitch Ratings, the highest level New York's second-largest city has achieved since a near bankruptcy brought it close to junk level a decade ago.
Fitch analyst Shannon McCue noted in a report Monday that the upgrade reflects a history of modest revenue growth and ongoing economic development spurred by state and private investment. The rating impacts $81 million of unlimited tax general obligation bonds and $151 million in limited tax GO bonds.
"The city's operating performance has been sound and reflects management's conservative budgeting practices and proactive fiscal management," said McCue. "Fitch expects revenue growth to remain slow in the near term based on historical trends, although ongoing investments are expected to boost revenue trends over time."
The Fitch boost follows one-notch upgrades by S&P Global Ratings to A-plus in 2014 and to A1 by Moody's in 2012. Moody's rated the city Baa3 between June 2003 and February 2007. Fitch, which began rating Buffalo in 2010, assigned an A-plus rating in April when then city sold $52.7 million of bonds to finance capital projects and refinance old debt.
"All three of the major rating agencies have upgraded the city in the brief time that I've been comptroller," said Buffalo Comptroller Mark Schroeder, who took office in 2012. "That shows that Wall Street has taken notice of the progress Buffalo has made, both in managing its finances and building its economy."
Schroeder said he took Fitch analysts on a tour of Buffalo last year to highlight the city's economic development projects like SolarCity and the Buffalo Niagara Medical Campus. He gave analysts from Moody's and S&P similar tours in recent years.
