Madden Administration’s “fact-based budgeting” a turnaround for Collar City finances, entering office with both an "A-" from S&P and an "A2" rating with a negative outlook from Moody’s;
As Administration transitions, incoming leadership receiving city with strongest-ever financial foundation;
Failure to maintain responsible budgeting would increase costs for Troy borrowing, squander hard-earned taxpayer dollars
TROY, NY – Mayor Wm. Patrick Madden announced today that S&P Global Ratings (S&P) upgraded its issuer credit rating for the City of Troy from “A” to “A+” with a “stable” outlook—the highest rating the City of Troy has ever received from S&P and a positive financial foundation to leave the incoming city administration.
Akin to a credit score, a higher rating means lower interest rates on municipal bonds and higher investor confidence. Municipal bonds have supported: park improvements; the purchase of new vehicles, such as fire pumpers, garbage trucks, and ambulances; police department equipment and facilities; Troy’s seawall; water infrastructure upgrades; road upgrades; new LED street lights across the city; among others.
"Today’s “A+” assessment from S&P confirms that, despite persistent political opposition, our administration’s commitment to sound financial practices has placed Troy on the best footing we have ever been on for continued success," said Troy Mayor Wm. Patrick Madden. "Passing seven consecutive balanced budgets required us to make difficult and unpopular decisions. I hope that the mayor-elect and our incoming City Council will work together to make the choices necessary to maintain the hard-won successes of the last eight years."
The highest rating yet from S&P means that one of the world’s leading credit rating agencies recognizes the City of Troy’s improved financial position under the Madden Administration. “A+” reflects Mayor Madden’s prudent approach to bond issuances and is a stark departure from the “BBB+” rating assigned to the city in 2007, when zero tax increase policies resulted in long-term financial stress for the City of Troy and taxpayers alike, and a decline in investments in our neighborhoods.
The Madden Administration has been characterized by strong financial management practices, resulting in steady rating and outlook increases during the Administration’s term from both Moody’s Investors Service (Moody’s) and S&P. However, Troy’s past was characterized by financial uncertainty, with the city narrowly averting bankruptcy in 1995 through the creation of the Municipal Assistance Corporation (MAC) which constrained city finances for 25 years.
In June, 2023, Mayor Madden announced that the City of Troy paid down all of its legacy operating debt obligations, liberating city finances from expensive debt payment obligations. The MAC and postponed pension liabilities were incurred to avoid making tough decisions—mistakes that the Madden Administration has worked to free the City of Troy from so they may be left in its past. On June 6th, 2023, the City of Troy prepaid the balance due to the New York State and Local Retirement System over deferred retirement benefit payments. The City issued its last payment to the Troy MAC in January 2022.
In July, 2023, Moody’s maintained an A1 rating for the City of Troy’s $13.7 million Public Improvement (Serial) Bonds. At the time, Moody’s noted that the City’s credit bond rating reflected improvements to the city's reserves, a growing local economy and tax base, and improved financial condition with the retirement of legacy operating debt.
The legacy of the Madden Administration is in the responsible stewardship of hard-earned taxpayer dollars, delivering to families for the first time in decades the opportunity for their city government to use today’s revenue to address today’s problems. Mayor Madden described "stupid debt" in his 2023 State of the City Address: "Stupid debt is taking out a 10-year home equity loan to pay for last months’ groceries or cable bill or your DraftKings account. You are committing future income to something that was consumed in the past. This is where we have lived in Troy for the past quarter of a century – under the burden of stupid debt."
The Neighborhood Reinvestment Budget Proposal
Mayor Madden recently put forth The Neighborhood Reinvestment Budget Proposal, an executive spending plan currently being deliberated by Troy’s City Council. The City of Troy’s “A+” upgrade from S&P reflects the Madden Administration’s Neighborhood Reinvestment Budget Proposal as it is currently constructed.
The Neighborhood Reinvestment Budget Proposal is a responsible $112,735,583 spending plan that navigates the post-COVID market challenges facing us all to address our families’ immediate needs while continuing to improve the quality of life in our neighborhoods. It is is comprised of a General Fund ($82,062,198) combined with a Debt Service Fund ($7,279,774) and three Enterprise Fund budgets for Water ($13,931,662), Sewer ($3,980,124) and Solid Waste ($5,481,825).
As noted by S&P, “the stable outlook reflects S&P Global Ratings’ expectation that Troy will likely continue balanced fiscal year-end results as it continues to create budget space by reducing debt it issues while looking to keep expenses manageable… Downside scenario: We could lower the rating if Troy were to revert to spending down reserves without making structural budget changes or if liquidity pressure were to occur.”
Thanks to the responsible fiscal prudence of the Madden Administration, the Neighborhood Reinvestment Budget Proposal is the first spending plan in decades in which the City of Troy did not have to set aside funds to pay down deferred operating deficits, including the now retired Municipal Assistance Corporation (MAC) Debt and New York State Pension Debt. The City of Troy is using these funds to invest in our future: maintaining safe, reliable water service through The Neighborhood Reinvestment Budget Proposal DPU Restructure Plan; making equitable changes to assessments related to the solid waste fund; and continuing the work of upgrading parks in every neighborhood of the City.
In his annual Budget Message, Mayor Madden wrote to City Councilmembers, “As we approach the upcoming fiscal year, we have every reason to be hopeful for the future of our City. I am confident that this is a fair plan for the City's taxpayers and residents.”
Mayor Madden also thanked the City workforce, Comptroller Andy Piotrowski, Deputy Mayor Chris Nolin, and City department heads, who have “labored to develop and refine their department budgets to keep within financial constraints while still meeting demands and providing excellent services.”
Read Mayor Madden’s full Budgetary Message.
The American Rescue Plan Act
In the wake of the COVID-19 Pandemic, the United States Congress and President Joe Biden passed the American Rescue Plan Act (ARPA)—delivering direct relief to the American people, rescuing the American economy, and providing much-needed public health resources.
The Madden Administration used its ARPA funding to make long-overdue one-time investments in Troy neighborhoods, allowing them to spearhead projects like its region-leading lead water service line replacement program (which has inventoried 45% of water service lines in the city to date and continues to replace lead service lines at no cost to the homeowner), comprehensive parks upgrades, the expansion of high-quality affordable housing, bold and transformative public art projects, improvements to youth services and so much more, while also paying down legacy debt and securing Troy’s best-ever financial ratings.
The Troy Now Initiative encompasses the City of Troy’s ARPA projects and initiatives. The Troy Now Initiative has engaged with residents, businesses and organizations on how ARPA funds can be invested back into the Collar City.
Read S&P’s full November 8th, 2023 Troy, NY Report.