The city of Norwalk will maintain its Fitch Ratings triple-A credit when it competitively sells $25 million of general obligation bonds Wednesday.
The top Fitch rating comes along with a stable outlook, and both apply to the city's $169.5 million of outstanding GO debt. The 20-year, fixed-rate bonds will finance various school projects and general capital improvements around the city.
Norwalk's rating is rooted in its diverse and growing tax base, high wealth among its taxpayers, consistently solid financial performance, and "healthy" reserves, Fitch said in its report.
The city, which sits on the north coast of the Long Island Sound about 45 miles northeast of New York City, closed fiscal 2005 with an audited surplus of $11 million - boosting its general fund reserves to roughly 13.8% of spending. Norwalk officials have included a 5.6% property tax increase for fiscal 2007 to help cover expected costs associated with benefits for retired public sector workers. The city estimates its accrued other post-employment benefit costs at $152.7 million, as of July 2005, the report said, adding that the city's OPEB liability planning is viewed as a credit strength.
The city's debt levels are moderate, and its five-year capital plan forecasts annual non-school bonding of up to $7 million. Norwalk is expected to borrow roughly $43 million, including Wednesday's sale, through fiscal 2010 for its school needs.
Moody's Investors Service and Standard & Poor's are not expected to rate the transaction.
