WILMINGTON, MA — Wilmington officials were pleased to retain its AA+ bond rating from Standard & Poor’s, but they aren’t satisfied.
After a rating review conference call on May 16, Standard & Poor’s determined Wilmington would remain at AA+ status. Town officials were hoping to upgrade to AAA.
“We made a very strong case as to why Wilmington is a sold community financially. Quite frankly, we were looking to pursue an upgrade to a AAA community,” said Town Manager Jeff Hull. “At the end of the day, Standard & Poor’s was very complimentary on many aspects of our operation, but we did retain the AA+ rating, which we’ve had for some time now.”
Town Accountant Mike Morris said Standard & Poor’s noted many positives in their review, including:
- Strong local economy
- Strong financial management policies
- Conservative budgeting
- Long-term budget forecasting
- Strong liquidity with healthy free cash reserves
- Low debt threshold
- Value of industrial properties in town
- Broad diverse business economy in town, including Analog expansion
- Respectable “Average Buying Income”
- Creation of a Master Plan Facilities Study
“Kudos to the Town Manager and his team for getting a AA+ again,” responded Selectman Chair Kevin Caira. “They’re probably a little disappointed, but a AA+ a big positive for the town, without a doubt. This is really a glowing report.”
“I really appreciate both [the Town Manager and Town Accountant] not being satisfied with the AA+,” added Selectman Greg Bendel. “I appreciate you striving for a AAA rating and I’m confident we can get to it.”
Selectmen Mike McCoy and Ed Loud offered brief positive comments as well.
While the town is addressing its retirement and OPEB (other post-employment benefits) liabilities by establishing reserve funds and annually paying both amounts down, Standard & Poor’s feel sit could be doing more in this area.
“S&P was looking not only at the town’s plan to set aside funds to pay off its liabilities, but steps being taken on the other end to reduce the cost of its liabilities,” noted Hull, he pointed out that the town recently enacted a change, which goes into effect on January 1, 2019, where retired employees currently on a particular health insurance plan (MEDEX Plan 3) will be transitioned to a less expensive plan (MEDEX Plan 2). “Next time we go through a review, we’ll get credit for that.”
“Retirement [costs] are our biggest burden and why we didn’t receive an AAA rating,” Morris agreed.
In a related moved, Selectmen authorized the issuance of a 15-year bond in the amount of $5.3 million to cover the costs associated with the creation of the Yentile Farm Recreational Facility, a Fire Pumper, the Water Main Replacement project on Middlesex Avenue, and the Water Main Replacement project on Ballardvale Street.
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