The city of Cambridge retained its distinction of being one of approximately 26 cities in the United States to earn AAA ratings from each of the nation’s three major credit rating agencies. Since 1999, the city has received these remarkable ratings each year from Moody’s Investors Service, S&P Global Ratings and Fitch Ratings.
“The City’s extraordinary financial performance and stability should not be taken for granted,” said City Manager Louis A. DePasquale, who will retire later this year. “This is the result of a collaborative effort between the City’s Finance team, City Departments and City Council to maintain and follow sound fiscal policies and practices. Even as the City emerges from the most significant impacts of COVID-19, it will remain very important to maintain the fiscal framework that has served us well and allowed us to accomplish so much together. As our AAA ratings reaffirm, I believe our future is bright and I am optimistic that the city will remain in a strong position to continue to support major new investments and initiatives, while maintaining fiscal stability and predictability for years to come.”
As of March 2020, the city’s priority has been to mitigate the spread of the virus that causes COVID-19 and to provide much needed services, especially to the most vulnerable members of the community, including individuals, families, small businesses and non-profit organizations. Throughout the COVID-19 pandemic, the city has also taken proactive steps to address budget uncertainties and shortfalls in several key revenues that remain below historical levels, including reducing certain expenses, carefully reviewing vacancies and strategically using reserves.
At the same time, the city maintained a high level of service to the community, created new initiatives, and continued its increased support for important city priorities and initiatives, including affordable housing, school services, the expansion of library, small business programs, road safety. , open spaces and climate initiatives.
The favorable credit ratings the city has consistently received play a direct role in limiting the burden placed on community ratepayers, even throughout the COVID-19 pandemic. Major projects funded by general obligation bonds related to our municipal facilities, our streets and sidewalks, our schools and our infrastructure are essential investments for the future and reflect the priorities of the city council and the community. On March 2, 2022, the city will conduct a competitive sale of $92.3 million in new general obligation bonds.
Capital projects funded under the upcoming bond issue include construction of fire headquarters, repair of fire stations; reconstruction of streets and sidewalks; reconstruction of River Street; Construction of Tobin Montessori and Vassal Lane High Schools; school improvement projects; municipal equipment projects; reconstruction and repair of sewers; and climate change projects.
Examples of past or ongoing capital projects include an investment of more than $500 million for three new schools, two of which have been completed – Martin Luther King Jr. and Putnam Avenue graduate schools and King Open and Cambridge graduate schools Street and the Community Complex — and the final, Tobin Montessori and Vassal Lane Upper Schools Project, is currently underway. The city has invested $13 million for improvements to City Hall, which are underway, and include the creation of a legislative floor, elevator replacements, and mechanical and electrical upgrades. The city is also investing $35 million to improve sewers, drainage, water, streets, sidewalks and open spaces in the Port District.
Credit reports from Moody’s, S&P’s and Fitch are available on the City’s website. Rating agencies pointed to the city’s strong financial position; a broad, stable and diversified tax base; ample excess offtake capacity under proposal 2½; budgetary flexibility; and a strong and experienced management team.