Moody’s Investors Service assigned a Aaa general obligation limited tax (GOLT) rating today to the City of Newton’s $20.3 million General Obligation Municipal Purpose Loan of 2023 Bonds. According to Moody’s, “The issuer rating reflects the city’s ability to repay debt and debt-like obligations without consideration of any pledge, security, or structural features” Moody’s went on to say that after the issuance of these bonds, the city will have approximately $349.5 million in outstanding debt.
The Mayor’s Press Release on the rating explained that almost “half of the proceeds are for the renovation of the new home for Lincoln-Eliot Elementary School on Jackson Road,” and that “the bonding will be used for the Newton Free Library parking lot improvements (recently completed), the replacement of all water meters citywide, upgrades to the Newton Police and Fire Department radio communication system, and the complete renovation of the Newton Senior Center/NewCAL.”
In explaining its rationale for the rating, Moody’s said “The Aaa issuer rating reflects a very strong and diverse economy within the greater Boston metro area and high resident income and wealth. The rating also incorporates a healthy financial position bolstered by diligent and forward-looking fiscal management, and slightly above-average leverage that is proactively managed with an affordable fixed costs ratio.
They also said, “The stable outlook reflects our expectation that the economy and taxpayers will continue to support the city’s financial position and its ability to manage a large capital plan while also reducing the unfunded pension and OPEB liabilities.”