New Beginning Seeks AAA Bond Rating for City
As a tool to “Build a Better Richmond,” Mayor Dwight C. Jones today announced his goal to pursue a Triple-A (AAA) bond rating for the City of Richmond. The announcement came during the Informal Session of the Richmond City Council in the Council Chambers, during which the mayor issued the following statement:
"I am before you today with what is perhaps the most important of my New Beginnings: the new start of planning for our long-term financial future. We are in a unique moment in time – in a dire economy – to plot our pathway into the future. We know that the economic downturn is not over and we know that the economy will rebound. During this period, the best thing we can do is to tighten our fiscal belts, assess our finances, and develop a bold plan into the future – by setting our goals now and then implementing those goals.
"Today, I am setting in motion our Tier One Plan. We want to become a Tier One City and we aren’t going to get there just by wanting it. We must plan strategically how to get there. One way to become a Tier One City is to upgrade our bond rating and strive for a Triple-A bond rating. This is not going to be easy – and it is going to take several years. However, we can start making strides to upgrading our bond rating – step by step.
"One way to improve our financial status is by tightening our belts in bad times – just like families across the city are doing. We need to maintain and even grow our reserves, and control our spending. This is not going to be easy – but we need to work together to do it.
"Another way we improve our bond rating is to show a willingness to make tough choices – determining what services we need and then allocating the resources to provide them. We will be looking at tough choices later this month during the budget process. We also need to look at the ‘non-financial’ things that good cities do that bond agencies look at; like the governing bodies working collaboratively and addressing social ills and crime problems. We must also work together to reduce poverty. These are things that do affect us financially and we have both moral and financial reasons to address problems.
"I am asking all city departments and agencies to work to help us attain our best financial status. It is not just a priority of our finance department – it should be the priority of all city agencies."
The mayor was joined in making the announcement by the city's financial advisors, Davenport and Company. Davenport and Company itemized a number of things that need to be accomplished to obtain a Triple-A rating:
- Strengthen and/or Add Certain Financial Policy Guideline and Best Management Practices.
- Minimize Number of Citizens Living at or Below the Poverty Level.
- Increase Regional Cooperation.
- Eliminate, Over Time, Revenue Anticipation Note Borrowing.
- Increase Annual Funding for Pension and OPEB Liabilities.
- Develop a Multi-Phase/Multi-Year Financing Plan.