Mayor: S&P Global Increases City's Bond Rating From BBB+ To A-

NEW HAVEN, CT — The city announced that S&P Global Ratings upgraded the city's bond rating, which has raised its long-term rating and underlying rating on New Haven’s general obligation debt from ‘BBB+’ to ‘A-’.

At the same time, S&P also assigned the city an ‘A-’ long-term rating and stable outlook for its $54.6 million series of 2023 GO bonds, according to the office of Mayor Justin Elicker.

“S&P’s bond rating upgrade is another important validation of the financial path we’re on as a city and the progress we’re making from the budgetary reforms we’ve put in place in recent years,” Elicker said. “Through a combination of increased revenues, responsible spending, proper forecasting, limited borrowing and balanced budgets, we’ve been able to provide residents with the essential city services they need today while also improving the city’s long-term financial health and outlook in the future. Much work remains, but we’re making steady and significant progress, and we’re poised for continued growth moving forward.”

S & P noted the rating increase reflected “the city’s demonstrated positive finances during the past three years, resulting in consistently improved available reserves due to more-conservative budgeting and management exerting more control of expenses while making necessary adjustments to keep the budget balanced.”

The rating increase also helps reduce the interest rate on current and future borrowing, saving the taxpayer's money, the mayor's office noted.

The ratings are not static, an S&P analyst says.

"We could lower the rating if financial conditions were to deteriorate and reserves were to decrease or if unmitigated debt-and-liability growth were to result in higher fixed costs that overcrowd the budget, limiting management's ability to maintain balanced budgets," said S&P Global Ratings credit analyst Anthony Polanco. "We could raise the rating further if budgetary flexibility and reserves were to strengthen to levels we consider commensurate with higher-rated peers while economic metrics improved, mitigating further increases in retirement liabilities and costs."

The mayor's office noted that the recent rating upgrade is the "second for New Haven in the last two consecutive years."

In 2022, the city received a bond rating increase from “BBB” to “BBB+” from Fitch Ratings, which Fitch maintained this year.