West Hartford received a competitive rate for the April 22 bond offering, with Standard & Poor’s reaffirming the town’s ‘AAA’ rating with a stable outlook.

By Ronni Newton 

The Town of West Hartford sold $15 million of general obligation bonds Tuesday morning, obtaining a rate of 3.928% True Interest Cost (TIC) for the offering after receiving eight bids, Town Manager Rick Ledwith said.

The general obligation bonds will be used to fund projects in the capital improvement program, including resurfacing and reconstruction of streets, updates to pedestrian and bicycle facilities, stormwater management, irrigation system for Rockledge, and investments in schools and other municipal buildings including air quality improvements and HVAC repairs.

Town officials said the rates were the best-available at the time of sale, and “an excellent indication of the town’s strong financial position and AAA status.”

In advance of the offering, on Friday, April 18, Standard & Poor reaffirmed West Hartford’s “AAA” rating – which the town has held since 1974. “The stable outlook reflects our view that the town’s economy and management practices will continue to support positive financial performance and growing reserves while management successfully addresses its large debt and retirement liabilities,” S&P Global said in their published release of the rating.

“West Hartford has been the recipient of the highest credit ratings for many decades, a distinction that reflects the town’s strong fiscal management and strong year-over-year financial positions,” Acting Chief Financial Officer Lisa Newton said in a statement.

In their report, S&P also highlighted the following factors in support of the AAA rating:

• “Consistent budgetary performance over the past decade, leading to increased unassigned general fund reserves, with plans to increase them further over the coming years along with access to additional committed reserves and reserves in other funds.
• “Management that uses detailed budgeting practices that incorporate long-term financial trajectory.
• L”arge debt and liabilities that result in higher per capita liability and current cost metrics than many national peers at the current rating, however, the town continues to be proactive in addressing these liabilities and ensuring that they remain stable and manageable.
• “The town benefits from an overall stable and strong property tax base, which generated over 80% of general fund revenue. Tax collections remain strong, exceeding 99%.
• “Although the tax base is primarily residential, West Hartford has a substantial local commercial base and is a regional retail and restaurant destination.”

As mentioned in recent years, S&P also noted as a positive the town’s decision in 2021 to issue pension obligation bonds to fund its pension system’s unfunded actuarially accrued liability and to stabilize fixed costs.

“Our financial stability is significantly improved by fully funding our pension fund with Pension Obligation Bonds, stabilizing town pension contributions, and adding to our unrestricted reserves,” Mayor Shari Cantor said in a statement.

“Our fund balance is at a historic high of 10.1% and our new fund balance policy allows us to build on that without further taxing our residents,” Cantor added. “West Hartford is unique to other highly rated communities in its vibrancy, diversity, commitment to sustainability, and inclusivity. We have excellent public schools and outstanding public safety, and we are repeatedly recognized as one of the best places in our state and country to live, work, and visit.”

“The AAA credit rating from Standard & Poor’s reflects our vibrant and growing economy and conservative financial strategies, and will allow us to reinvest in our community with a variety of capital projects,” said Town Manager Rick Ledwith.

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