The City of Worcester has received an ‘A’ rating from Fitch Ratings, a provider of credit opinions. The rating counts towards Worcester’s $47 million general obligation (GO) bonds, and the City’s $561 million outstanding long-term debt, with an overall outlook rating of stable.
The ‘A’ rating reflects Worcester’s historically consistent fiscal performance, prudent financial management and budgeting, strong tax base growth, and a stable employment base supplemented by higher education and health care institutions. These strengths are balanced by Worcester’s above-average debt levels when pension bonds are included, as well as its below-average income levels, wealth, and employment.
While the presence of nine colleges and various health care organizations helped offset some of the City’s lower ratings, the lower-than-average income levels are impacted by the 30,000 students who reside in the area.
Fitch forecasts that despite Worcester’s stable fiscal performance, fiscal 2006 expected results will show a $7.2 million decline in total fund balance, a negative 43.6% change over fiscal 2005.
