Portsmouth Reaches Coveted AAA Bond Rating Status from Standard & Poor's

Portsmouth has reached an historic financial milestone after a ratings upgrade from Standard & Poor’s Rating Services on Friday.

The town now can boast having an AAA rating — the highest rating a community can receive and the first time in the town’s long history that it has ever reached coveted triple-A status.

“This is Portsmouth’s financial report card, and it is nothing but A’s,” said Jim Lathrop, the town’s finance director. “It is gratifying to work for a community that takes its financial health seriously.”

Standard & Poor’s analyst Timothy Little said the rating “reflects our assessment of the town’s very strong liquidity, management conditions and debt and contingent liabilities position.”

Portsmouth is also situated near “very strong economy in the broad and diverse Providence-Warwick metropolitan statistical area,” the town’s “strong budgetary flexibility” based on a strong fund balance and a “history of positive general fund results.”

“The stable outlook reflects our view that management will remain proactive and make the necessary adjustments to produce at least balanced operations as it has demonstrated while adding to available general fund reserves,” Little said. “Adopted management policies provide a mechanism to address and manage liquidity at strong levels, which, in our view, provides for long-term rating stability, along with limited future capital needs.”

Portsmouth now joins Barrington as the only AAA rated communities in Rhode Island. In Massachusetts, only 29 of 351 communities have attained the AAA mark.

“This is particularly rewarding given the financial challenges we have faced the last few years and is affirmation that the town is moving in the right direction,” said Town Council president Jim Seveney. “The AAA rating reflects our absolute commitment to honor our fiduciary responsibility to our residents and taxpayers and is a reflection of the hard work of our town and school leaders over the last two years.”

A high bond rating offers a town a lot more than just bragging rights. It means lower interest rates when the town borrows for large projects and floats bonds approved by voters.