DERBY — The following statement was released by Derby Mayor Rich Dziekan’s office Wednesday in response to a Valley Indy question about the city’s new debt rating. Click here for a full story.
While we are not happy that the city was downgraded, we understand the reason S & P made the decision they did.
The administration has had multiple interactions with the rating agency via conference calls over the past two months. S & P has confidence in our 8‑point recovery plan to bring the Derby back to fiscal health, and we firmly believe that without those interactions and the thoughtful detailed presentation of the recovery plan, the downgrade would have been much worse than the one notch.
There were many weekend and night hours spent preparing for those conversations and tending to the budget issues. The Mayor’s office was involved in all high level conversations, but when it comes to the numbers, we left that to the City Treasurer, our Financial Advisor, and Bond Counsel. The City Finance Director and Corporation Counsel also had involvement along the way.
Because there were so many factors to be considered, and it was such a critical issue, we devoted most of our collective bandwidth to coming up with a comprehensive solution and the result of that is the 8‑point plan and the execution thereof. I know the City Treasurer plans to give the Board of Aldermen/Alderwomen an update on the city’s progress at their regularly scheduled meeting on September 12th.
A review of the Bond rating and the most recent bond sale was originally slated to be presented to the Board of Apportionment and Taxation on August 19th, but they did not have a quorum, so a meeting was not held.
At the most recent bond sale on August 15th, the city executed its refinancing debt at the lowest interest rate in the last 40 years. In other words, the money that the city is borrowing is at a rate lower than it is has been in four decades.
As an aside, we’d also like to note that Shelton was also downgraded a notch and has a bond rating equivalent to Derby.
