Moody’s upgrades Batavia bond rating

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Updated: March 24, 2012 11:26PM

BATAVIA — Moody’s Investors Service has upgraded the bond rating of the city’s general obligation debt.

On Friday, city officials announced Batavia has received a positive bond rating upgrade from Aa2 to Aa1.

“It is a statement to our credit worthiness and ability to repay debt that has a direct savings to taxpayers,” said Peggy Colby, Batavia finance director.

Colby said the city requested a re-evaluation of its bond rating because it is refinancing of a $1.6 million, 2005 outstanding bond issue for the reconstruction of the Donovan Bridge.

Colby said the general obligation bond will be reissued at a lower interest rate that will save taxpayers $150,000 in interest over the remaining life of the bond. Colby will find out the interest rate on Monday.

Moody’s Aa1 bond rating is its second highest rating.

“It is a very good rating and the higher your bond rating the better the interest rate,” Colby said.

Moody’s report said the city’s strong financial position was supported by healthy reserves and conservative financial management.

Moody’s report states that it anticipates the city’s financial position will likely remain strong due to support from reserve and “the revenue raising flexibility” through home-rule status.

The City Council will vote on the refunding of the $1.6 million in bonds on Monday.