NEWBURGH – Moody’s Investors Service has upgraded the City of Newburgh’s outstanding issuer and general obligation limited tax obligations to A3 from Baa2. The outlook has also bee revised to stable from positive.
The rating form said the upgrade “reflects the city’s continued improvement in its reserve position both within the general fund and in its utilities.” It said the reserve position is expected to remain strong in the near-term as the city has achieved structurally balanced operations, a significant change in budget management and overall governance from several years ago.”
Moody’s said Newburgh’s local economy has seen growth, “but its resident income levels still remain weak.” It said its long-term liabilities “are elevated along with fixed costs; however, the city is working to reduce liabilities through changing health care plans and utilizing grants to fund projects.”
Moody’s said the outlook “reflects the expectation that the city’s financial position will hold at currently strong levels despite expected increasing labor costs through its strong financial management team.”
The agency cautioned, though, that factors that could lead to a downgrade of the ratings include a return in structural imbalance in any of its operations, a decline in tax base and wealth indicators, and material growth in long-term liabilities.