Gov. Lincoln Chafee’s executive order to form a task force on shared services among Central Falls, Pawtucket and East Providence is a credit positive for those stressed Rhode Island cities, according to a Moody’s Investors Service report.
“There is ample room to share services and reduce costs in these cities,” the rating agency said in a report. “The acute financial strain experienced by all three cities is likely to motivate them to embrace shared services plans proposed by the task force.”
Central Falls, which filed for Chapter 9 bankruptcy protection last Aug. 1 and could exit later this summer, is under a Moody’s review of its Caa1 general obligation bond rating.
Moody’s assigns its Baa2 rating and a negative outlook to Pawtucket and Ba1 rating and a stable outlook to East Providence.
The five-member task force, which will consist of representatives from all three cities and the state, will advise on cost-saving strategies, though it cannot force cities to take such action.
Moody’s cited ample precedent in the Northeast, including K-12 education and fire protection services in New York State, and the consolidation of Princeton Borough and Princeton Township.
