$68,915,000 20-year general obligation bond issued with an average interest rate of 3.317%
Town Manager Matt Kraunelis is excited to announce that S&P Global Ratings (S&P) assigned its ‘AAA’ rating to Reading for its $75.425 million series 2025 general obligation (GO) municipal-purpose loan bonds. This is the highest quality bond rating for municipalities, and one the Town has held for more than a decade.
In their report, S&P cited Reading’s exceptional economic fundamentals, conservative financial management practices, and strong operating performance from the management team as key drivers of the rating. The Town’s full-faith-and-credit pledge secures the bonds, which will provide permanent financing for various upcoming town capital projects, including the Killam Elementary School project and the Reading Center for Active Living.
S&P highlighted several strengths of the Town contributing to the ‘AAA’ rating:
- Stable, reliable revenues where property taxes make up roughly 70% of total revenues, with state aid around 20%.
- Consistent conservative budgeting, with expenditures under budget and revenues exceeding projections.
- Healthy reserves that exceed statewide medians, providing financial flexibility.
- Strong, affluent residential base with incomes well above state and national averages.
- A manageable debt profile, even with upcoming issuances for major capital projects.
- Proactive long-term planning, including a detailed 10-year capital plan and five-year financial forecasting.
S&P assigned a stable outlook, meaning that there is an expectation that Reading will continue producing balanced results and maintaining strong reserves.
This week the Town also received competitive bids from bond underwriters for a $68,915,000 20-year general obligation bond issue. Raymond James & Associates, Inc. was the winning bidder on the Bonds with an effective interest rate of 3.317%. The Town received a total of 10 bids on the Bonds. The initial authorized borrowing amount was up to $75 million, Reading ultimately borrowed $68.9 million because the winning bid included a bond premium. Investor demand generated the bond premium, resulting in reduced long-term borrowing costs for taxpayers.
“Maintaining a AAA rating is essential to protecting our taxpayer dollars. It ensures Reading’s long-term planning and investments remain affordable and financially sustainable,” said Chief Financial Officer Sharon Angstrom.
“Reading’s AAA rating is a testament to the hard work of our finance team under Sharon’s leadership, the Select Board’s guidance, and the community’s trust,” said Town Manager Matt Kraunelis. “This rating allows us to continue investing in priority projects at the lowest possible cost to taxpayers.”
For more information, contact the Office of the Town Manager at (781) 942-9050.
