Fitch upgrades Woonsocket, West Warwick ratings

Fitch Rating Agency Inc. last month upgraded ratings for both Woonsocket and West Warwick.
Fitch Rating Agency Inc. last month upgraded ratings for both Woonsocket and West Warwick.

WOONSOCKET – Fitch Rating Agency Inc. last month upgraded ratings for both Woonsocket and West Warwick.
The global rating agency upgraded Woonsocket’s issuer default rating from BB- to BB+. It also increased the city’s outstanding series 2002 and 2005 general obligation bonds to BBB from BB-. The general obligation rating increase reflects “enhanced recovery” for bondholders afforded a lien on pledged property tax revenue. The rating outlook is stable.
Two days later, Fitch upgraded West Warwick’s issuer default rating from BBB- to BBB and its $3 million general obligation bond, series 2007, from BBB- to A-, according to the company. The town’s outlook was revised from positive to stable.
West Warwick’s upgrade comes from its stabilization of pension and OPEB (other post-employment benefits) reforms along with long-term employee contracts. The actions have provided “budget relief, a reduced burden on the tax base and a lowering of the long-term liabilities associated with retiree benefits,” according to the Fitch.
Woonsocket’s upgrade comes as the city has stabilized its general fund and school fund operations along with improved budget management, according to Fitch. Until just recently, the state advised Woonsocket’s budget. The rating agency called its long-term debt and pension liability burden “moderate, with an additional sizable OPEB liability.”

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