MEDWAY
The town will save at least $200,000 thanks to its better bond rating, selectmen said last night.
Selectmen unanimously agreed to accept a general obligation bond award from Morgan Keegan & Co. Inc. of Memphis, Tenn., at an interest rate of 2.019 percent. The bond is for $8.1 million.
Treasurer and Collector Melanie Phillips recommended the board approve the bond, which will finance all outstanding borrowing, including the $5 million Medway Middle School repair project, as well as new money for additional projects.
Medway usually receives three to four bidders for its municipal bonds, but thanks to its improved bond rating, 10 have bid this year, Selectman Glenn Trindade said last night.
Selectman Dennis Crowley said the town’s fiscally conservative decisions were behind the improved bond rating and lower interest rate, which is about 1 percent lower than the previous rate. The town will be able to save on new projects thanks to the better interest rate, he said.
Medway found out two weeks ago that it received a bond rating of AA from Standard & Poor’s, up from AA-.
Standard & Poor’s looks mostly at continued improvement in the financial condition of a town, continued strength of town reserves and proper financial management when it determines the rating, Phillips has said. Medway’s stable tax base and stable property values were also cited in the rating increase, she said.
Town Coordinator Suzanne Kennedy , who was also at the meeting last nightMON, has said it’s gratifying to know the rating agency recognizes management’s work over the past few years. Medway endured a state-approved deficit financing plan to deal with a $2 million deficit in 2006. Since then, town finances have turned around.
A rating of AAA is the highest possible for the three agencies that grade government entities and corporations: Moody’s, Standard & Poor’s and the Fitch Group. That AAA rating indicates complete stability and reliability. For Standard & Poor’s, the next highest rating is AA+, followed by AA and so on.
Whitney Clearman can be reached at 508-634-7556 or wclearman@wickedlocal.com.