This Blog is the first of what I hope will be many informative articles. The Board of Selectmen recently hosted a public meeting with Standard & Poors, the Town's bond rating agency. You may be aware that Norwell presently holds a AAA bond rating, the highest credit rating that a municipality can have. We are extremely proud of accomplishing the rise to being rated AAA.
This AAA rating has been granted Norwell as a result of many years of prudent management decisions, strict financial controls, employing competent management personnel, and maintaining respectable cash reserves. Only 8% of Massachusetts towns hold a AAA rating and only 1% of towns nationwide are rated AAA. The Selectmen and our financial team worked hard to obtain AAA and it requires hard work and considerable discipline to retain it.
With financial pressures what they are today, many Towns are facing having their bond ratings lowered.
As fewer and fewer Towns are able to maintain AAA, the importance of being a AAA Town becomes
even greater. At some point, with many bond insurers failing, Towns that are not AAA may have
trouble selling their bonds. Even if those non AAA rated Towns are able to complete a sale, the interest rate will be much higher than it is today because supplementary insurance to "buy up" to a AAA status is much harder to obtain than even just 2 years ago.
In conclusion, when the Selectmen discuss Norwell's bond rating and the effect a particular action
may have on it, please listen closely. Should our Town make decisions causing us to lose our AAA
status, it would take many years to regain it.
Respectfully,
Richard Merritt
Chairman
Norwell Board of Selectmen
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