Hamden bond rating climbs to a stable A+

By Ann DeMatteo, Assistant Metro Editor

HAMDEN — Officials were all smiles Thursday when they learned the town’s bond rating went up a step.“It went up from A with a positive outlook to A+ and stable. It’s fantastic. It’s great news in a recession and for going to the bond market,” said Mayor Craig B. Henrici.

Henrici said he learned of the upgrade Thursday afternoon from the town’s financial adviser, Barry Bernabe, vice president of government finance for Webster Bank.Standard & Poor’s delivered the news to Bernabe, the result of a teleconference Henrici, Bernabe and other town officials had Monday with Standard & Poor’s.Bernabe said he worked closely with Henrici, acting Finance Director Jennifer Charneski, Chief Administrative Officer Scott Jackson and Economic and Community Development Director Dale Kroop on the rating presentation.A rating is necessary before a community plans to borrow money, according to Bernabe and Charneski. Another rating agency will hear the presentation Tuesday, he said.

According to Charneski, the town will receive bids on bonds and notes Aug. 12 for the $36.35 million Memorial Town Hall, police station and fire station renovation project. Jackson said 115 vendors have obtained bid packages. The bids were to be opened Thursday, but because the town and agents for the project are in the middle of answering questions from potential bidders, the bid opening was postponed to Aug. 13.Charneski said the town will take out long-term bonding of $2 million for money already spent on preconstruction work involving the Town Hall project. Then, the town will take out $21.5 million in one-year notes for the first year of construction, based on the estimated cash flow.Also in August, the town will seek bonding on some capital improvement projects from fiscal 2006-07 and 2007-08, including purchase of the Dadio farm on Putnam Avenue.

The highest rating given is AAA. There are three AA ratings, followed by an A+ and below.Rating agencies look at demographics, the management team, a municipality’s debt position and financial performance before issuing ratings.Bernabe said Standard & Poor’s said Hamden had a low debt burden with a faster than average debt amortization. The town has $78 million in debt.Hamden had a AAA rating about 15 years ago, but demographics have changed, meaning wealth levels based on per capita income have dropped over the last 20 years, Bernabe said.The rating agency said the town’s fund balance is adequate, but it would like the town to increase its fund balance, which is now at 4.4 percent, or $7.7 million, of a $176 million budget.“They like to see 5 percent or higher,” Bernabe said.Republican mayoral candidate Ron Gambardella welcomed the improvement in Hamden’s bond rating, but disagrees with the method of achievement.“The Henrici-Jackson administration has obtained this rating off the backs of the taxpayers as a result of three consecutive tax increases,” said Gambardella, saying that he fears a “financial tsumani” without a change at the top.

Jackson, who is running for mayor and is being challenged in a September primary by Councilman James Leddy, said that it was “extraordinary” that the town would get a rating increase in such a bad economic climate and that the town will save a lot of money in bonding because of it.Leddy could not be reached late Thursday.