City Credit Ratings
Credit ratings provide an independent measure of an entity's creditworthiness and fiscal health. The City's overall rating, and the ratings of Burlington Electric Department, Burlington International Airport, and Burlington's Water Utility,are all important indicators of the City's financial health. Higher credit ratings typically result in lower borrowing costs, which can lead to significant savings for the City.
Since March 2016, the credit ratings for the City, the Electric Department, and the Airport have all been upgraded or seen the outlook change to positive by Moody's Investors Services.
An improved credit rating indicates to investors that the City's financial health is improved. This typically results in lower borrowing costs for City bonds and thereby lower costs to tax and rate payers.
In 2013, Moody's assigned the City a General Obligation credit rating of Baa3 with a negative outlook. By 2017, the rating had increased three steps to A3, with a two step increase to "positive," Moody's highest outlook rating. Since late 2014, Moody's has also improved the ratings for the Airport (one step) and the Electric Department (two steps).
Led by the Mayor, the Director of Financial Operations in the Clerk-Treasurer's office, CAO, and our financial consultants prepare documents that are shared with one or more rating companies such as Moody's. We are then given a series of written questions which we respond to both in writing and through a lengthy conference meeting. The City score is determined by economic and strength of tax base, strength of management, fund balance, debt burden, reserve levels, and liquidity.