National bond rating agency Fitch Ratings, Inc. announced on August 11 that it has affirmed a AA+ bond rating for the City of Gastonia. The agency affirmed the bond rating at AA+ and the standalone credit profile (SCP) of the City’s water and sewer system at aa+. The Fitch review also added, “The Rating Outlook is Stable.” Ratings from Fitch generally indicate a city’s financial stability and overall financial health.
“We are pleased that our City continues to be recognized for its financial stability and creditworthiness,” said City Manager Michael Peoples. “It is important that the public knows that we continue to work diligently to be good stewards to the taxpayers and ratepayers who invest in our City.”
The City of Gastonia provides water and sewer service to about 100,000 residents and 32,000 water and 29,000 sewer accounts directly within the city under the name of Two Rivers Utilities. It is also a regional provider of wholesale water and wastewater services to surrounding towns and municipalities. Several of the system’s top water and sewer customers are municipal customers that have signed long-term, minimum volume-based contracts with the city for services.
In essence, the debt rating means that the City of Gastonia will be able to sell future bonds and debt at lower interest rates. Those lower rates will enable the City, and thus, its taxpayers, to save money in interest costs when the City issues debt.
Fitch Investor’s Service is a national bond rating agency that analyzes the financial health of municipalities based on such criteria as economic base, debt burden, administration and governance. The Fitch rating system is very similar to Standard & Poor’s (S&P) in that they both use a letter system.
Visit this link for more information about the bond rating.