Westford’s Bond Rating Goes AAA

The town of Westford recently received a boost in its general obligation, long-term borrowing rating from AA+ to AAA, according to a memo sent to the town from Standard & Poor’s.

The upgrade essentially raises the town’s capacity to fulfill its financial commitments from “very strong” to “extremely strong,” according to industry terms, and allows the town to find the best, most aggressive rates possible when borrowing.

According to the memo, the increase reflects a perception by the ratings agency that the town’s economy is “very strong, with projected per capita effective buying income at 188 percent” as a percent of a market value of $173,000, per capita. The town’s “budget flexibility,” according to the analysis, is considered strong, with more than $13.5 million in reserves or 14 percent of operating expenditures for fiscal 2013. 

The agency noted that while the town raided $2 million of free cash for FY14, it also lined up close to $2 million in health insurance savings, which would offset the draw down.

“In our view, Westford’s budgetary performance is strong overall,” the analysis stated, noting low deficits, strong liquidity, and strong access to capital markets.

Westford Town Manager Jodi Ross said in a statement that her office was “delighted” with the upgrade and stated that it put the town “into a category with relatively few other Massachusetts communities who have received this high assessment.”

Ross added that it was officials like the Board of Selectmen, Finance Committee, and Capital Planning Committee that helped her department “develop our financial policies and who offer us the direction and support to enable us to achieve this distinction” for the community.

“I would also like to acknowledge our extraordinary finance team, who continually make recommendations for improvement, and ensure we follow our financial polices on a day-in day-out basis,” she said.