City gets 'positive outlook' on improved fiscal health

Moody's -- the bond-rating agency -- likes Batavia.

Maybe not as much as they could -- the city's bond rating was downgraded in 2005 from A1 to A2 and remains there -- but a series of fiscal reforms caused the agency to issue a "positive outlook" for the city.

"It should be seen as good news," City Manager Jason Molino said. "They're saying, not only have you achieved the goals you set out to do, you achieved them sooner than you expected. In 2006, the city council set out to pay back all deficits by 2012. They did it by 2010."

Not that there aren't areas of concern for Moody's.

First, the fund balance isn't as high as it should be for a fiscially healthy municipality, and the unresolved contract with the Police Benevolent Association is a cause for concern.

Those two items are prime reason the city isn't getting back, just yet, it's A1 rating.

A municipal bond rating is like a credit score for personal finances.

In 2005, Moody's knocked the city for operating defcits four out of five years, negative general fund balance, high amount of delinquent property taxes, excessive police and fire overtime and the fact that the city's largest revenue source was sales tax.

Now, Moody's is praising the city for operating surpluses in all funds the past four consecutive years, eliminating certain kinds of municipal borrowing, and making progress on equipment and infrastructure projects. Plus, Moody's notes that in 2009 the city had the first positive undesignated fund balance since 2004.

"What they're saying," Molino said, "is that here in the past we faced challenges, in the not-too-distant past, but what the city council did, what we did as a community, is achieve transformative change."