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SanFilippo Announces "A+" Bond Rating

CONTACT: ROBBIE ANN McPHERSON
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City Comptroller Andrew A. SanFilippo announced today that the City of Buffalo has received a bond rating of A+ from Fitch Ratings, a Wall Street rating agency.  It is the first time in nearly three decades that all of the City’s bond ratings are in the A category, and the first time in the City’s history that all three Wall Street rating agencies have weighed in.

According to the report, “The city’s economic base is diverse and continues to experience commercial and residential development despite the economic downturn.”

The inaugural rating report from Fitch, released today, is seen by some financial analysts as an indication that the City is successfully surviving the current economic crisis.

“To receive an A+ in these challenging times is unprecedented for the City of Buffalo,” said Comptroller SanFilippo. “I think anybody associated with the City of Buffalo should be proud of what we accomplished under some very difficult circumstances.  It means our viability in the bond market has improved, and the market is recognizing the prudent fiscal policies of my office, Mayor Byron Brown, and the Common Council.”

Bond ratings are critical to a municipality’s ability to borrow through the sale of bonds, creating a resource that can fund various capital improvements for the City and the School District.

“What this means to the City’s taxpayers is less of a burden on their pocketbooks through lower interest costs,” SanFilippo said.
The report also states “The city maintains strong reserve levels that it has built up since the beginning of the decade.”

But the Comptroller remains cautious about keeping spending levels in check.

“It is so important for the City to be vigilant with its fund balance, and to remain consistent with conservative budgetary practices and fiscal restraint,” SanFilippo said.

Fitch recently rated Erie County an A from BBB, after global ratings recalibrations were calculated.  Both the County and the City have state-appointed control boards, but SanFilippo said the City’s A+ is validation of Buffalo’s strong financial performance.  It could also be an indication that the Buffalo Fiscal Stability Authority, the City’s control board, could give strong consideration to reverting to an advisory capacity.

“The BFSA has helped guide the City into this position,” said SanFilippo, “however, within three years we have achieved two consecutive bond upgrades with Standard and Poor’s, one from Moody’s Investors Service, and now an A+ with Fitch.  As our ratings continue to improve, there is less of a need for hard oversight,” he added.

The ratings reports are based on various financial and demographic criteria.