Niskayuna now has the most favorable bond rating of any town in Schenectady County, after Standard and Poor’s announced it would upgrade the town’s standing two notches.
The town’s new rating of AA+ means it has “very strong capacity to meet financial commitments,” according to the ratings agency’s website.
The upgrade contradicts unfavorable predictions made by another ratings agency, Moody’s, after a particularly tough winter storm and lean tax season in 2011. Town Councilwoman Julie McDonnell, an accountant, said the outlook at that time reflected the condition of local governments nationwide.
“I think probably the reason for the outlook was not just Niskayuna, but that municipalities are in a tougher situation,” she said, citing a combination of tax caps and rising mandated costs, such as pensions.
She said careful budgeting, combined with revenue measures such as fees for yard waste collection, put the town back on the right track.
Town Supervisor Joe Landry said the upgrade represents more than the town’s balance sheets. “It’s really an evaluation of the financial condition of the community,” he said. “It’s an evaluation of the management of the town.”
In addition, he said, the town has been better prepared for the winters it has faced.
“Last time, they looked at the 2008 ice storm, which was like Hurricane Irene but in the wintertime, so there was extreme damage,” he said. “We didn’t have any budgetary issues this winter.”
McDonnell said building reserves for unexpected situations, like the 2008 storm, is an important part of securing a favorable bond rating. She said the ratings upgrade will have practical benefits for Niskayuna in the immediate future.
“We do have some water and sewer projects coming up,” she said. “As we move forward on those projects, this rating will impact our ability to do so at a lower rate.”
“We’re certainly not out of the woods,” said McDonnell.
“We have to be concerned about our rising costs, but I think we’re on a good track.”