INQUIRY, OBJECTION…..PLEASE HOLD ALL TICKETS…on the last post...

The stewards are reviewing the placing of Massachusetts cities and towns with AAA Standard and Poor’s, and Moody’s Bond Ratings.

Yesterday the Massachusetts Municipal Association (MMA) reported the following (copied and pasted from MMA’s website);

22 cities, towns earn top bond ratings        

        
Friday, August 22 2008

Twenty-two Massachusetts cities and towns currently have the highest possible bond rating from at least one of the three major rating agencies: Standard and Poor’s, Moody’s Investor Services, and Fitch Ratings.

Despite the challenging fiscal climate, four towns – Arlington, Chatham, Duxbury and Natick – recently achieved an AAA ranking from Standard and Poor’s for the first time.

Cambridge and Hingham currently have AAA ratings from all three rating firms; Dover, Wellesley and Weston have achieved the highest bond rating from both Moody’s and Standard and Poor’s. Sixteen communities have an AAA rating from either Moody’s or Standard and Poor’s.

The 15 Massachusetts communities earning AAA ratings from Standard and Poor’s this year represents a notable proportion of the 108 cities and towns receiving that designation nationwide, according to Karl Jacob, a director in the company’s public finance group.

The existence of a state program to help fund local school projects and relatively stable sources of municipal revenue contribute to the strong showing of Massachusetts communities, Jacob said.

Once a city or town reaches AAA status, it is generally able to remain there, according to Jacob. The rating is based not just on the community’s current financial standing, but on its performance over many years, he said.

“The triple-A’s tend to move right through these [economic] slowdowns,” Jacob said.

Cities and towns with AAA bond ratings:

Standard and Poor’s

Arlington
Bedford
Cambridge
Canton
Chatham
Dover
Duxbury
Hingham
Lincoln
Natick
Needham
Sherborn
Sudbury
Wellesley
Weston

Moody’s Aaa ratings;

Belmont
Brookline
Cambridge
Concord
Dover
Hingham
Lexington
Newton
Wayland
Wellesley
Weston
Winchester

Fitch Ratings

Cambridge
Hingham

By MMA Associate Editor Mitch Evich   

WHAT IS THE MMA?

Information/Research

The MMA’s professional staff responds to hundreds of inquiries each month, providing local officials with information and referrals.

MMA Organization

The Massachusetts League of Cities and Towns was formed in 1961. In 1979, the League was consolidated with the Massachusetts Selectmen’s Association and the Massachusetts Mayors’ Association and the name was changed to the Massachusetts Municipal Association.

The MMA is governed by a 35-member Board of Directors composed of municipal officials from across the state—mayors, selectmen, councillors, municipal managers and finance committee members—who are elected by their peers to represent Massachusetts communities.

 

Barnstable is a member of the MMA, and as I recall, membership dues are based on 75% of the town manager's salary, which means Barnstable taxpayers pay $80,000 a year for MMA services, like the bond rating analysis.

When I read the report, I had some reservations since I wrote a post earlier this year about AAA bond ratings, so I called John Robertson of the MMA and got his voice mail.
 
He never returned my call, so I reported the story as printed by the MMA.  After all the entire article was written by Mitch, Evitch, an Associate Editor, and why shouldn’t I?;

Thomas Menino is a second Vice President of the MMA.

Who am I to argue with the MMA that has virtually all 351 Massachusetts Communities as members?

The Massachusetts Department of Revenue (DOR) Data Bank reports that as of July 1, 2008 the communities/school/ districts that received AAA Standard and Poor bond ratings were;

BARNSTABLE
BEDFORD
CAMBRIDGE
CANTON
CHATHAM
DOVER
DUXBURY
HINGHAM
LINCOLN
NATICK
NEEDHAM
SHERBORN
SUDBURY
WELLESLEY
WESTON
LINCOLN SUDBURY SCHOOL DISTRICT
SUDBURY WATER DISTRICT            

The DOR also reported that as of July 1, 2008 the following communities received Aaa Moody’s Bond Ratings;

BELMONT
BROOKLINE
CAMBRIDGE
CONCORD
DOVER
HINGHAM
LEXINGTON
NEWTON
WAYLAND
WELLESLEY
WESTON
WINCHESTER

As of July 1, 2008 Barnstable was listed as having an AAA bond rating from Standard and Poor, but August 28th is two months after July 1st and a lot of things can happen in sixty days.

For example;

• on July 1st the Red Sox were in first place in the American League East conference, but have been mired in second place since.
• Today’s newspaper is tomorrow’s fish wrapping.
• If you drop a wad of $100 bills, and someone else picks it up, it’s their wad of $100 bills, not yours, 
• Barnstable’s F/Y2008 $24 million in cash reserves, is F/Y2010’s budget deficit, and
• This week’s Barnstable Town Council President literally may be barred from  town hall after the Presidential Election.

Things change, and fast.

The MMA’s report look’s legit, because it added Arlington to the list of Standard and Poor’s AAA bond rated communities, displacing Barnstable.

Mitch even went on to say that the current AAA rating is a first for Arlington, and Arlington is not listed in the July 1, 2008 DOR Standard and Poor reporting.

From all appearances the MMA's deletion of Barnstable from Standard and Poor's AAA cities and towns was done after a careful analysis.

It took me all of thirty seconds to sort the DOR file and come up with AAA communities.

How could Mitch miss Barnstable?

If he sorted the DOR file, Barnstable would be the first, so how did Arlington get into the picture?

After all the Barnstable School District reported laying off scores of teachers and other personnel due to budget constraints in the spring,

• and predicted more layoffs if the council doesn’t come up with $1 million to cover increased energy costs.

Mitch Evitch did say the ability to fund school programs is a major factor in AAA bond ratings.

Interestingly earlier this week the MMA listed the job opening for the Director of Barnstable's Growth Management Department, but removed the listing today.

This means that either Interim Director, Patty Daley, or a new hire, will be taking the job soon.

Next month, it'll be a year since Bob Smith passed, which means Patty Daley has been Interim Director long enough to be considered for the full time job.

I reported earlier this month that Patty was headed back to the Cape Cod Commission.

Standard and Poor, and Moody's do react to wholesale teacher layoffs, and threats of more, as well as budget deficits.

As kids go back to school they'll find bigger classrooms and fewer teachers, with threats of more layoffs if the $600,000 energy costs aren't covered.

Things are so bad the school district may sell the $3 million Osterville Bay Elementary school for $30,000.

On Thursday, Barnstable Town Manager, John Klimm, announced he will give notice of dire financial straits the town is headed into this spring.

I'll bet a dollar to a doughnut, that on Tuesday, September 2nd, Geoff Beckwith, MMA CEO gets a telephone call from an irate John Klimm, if Janet Joakim doesn't beat him to it.

In the meantime as Bob and Ray used to say; "Hang by your thumbs," and hold your tickets until Tuesday.

In the world of municipal finance, when bald-headed managers talk,

Standard and Poor listens…

Comments

[John Julius]

Gary,

I understand there are some from around town who seem upset about the info on the AAA bond rating... yes, you are merely reporting what you read and big deal... MANY people seem lose site of the REAL ISSUE! Which is:

John Klimm and his MORONS on the town council THINK they have everyone fooled with the GARBAGE AAA bond rating......

Sure, Klimm and his finance wizard Mark Milne got cutesy and they MILKED about $ 24 MIL into the town coffer "free cash and stabilaztion fund".... so naturally OUR TAX MONEY looked to Moody's or whoever gave the phony AAA rating.....

THE REAL TRUTH is that MOST of the $ 24 MIL SHOULD HAVE BEEN GOING TO PAY FOR AND PROVIDE MUNICIPAL SERVICES to the TAXPAYERS here! ANYONE who gets ripped off paying the SICKENING bus fees should have fire in their eyes about this RIPOFF!

Master Klimm and his finance man simply THINK they are fooling us.... nice try Mr. Klimm. ONE of these days SOMEONE will start the Barnstable TAXPAYER Association and this kind of ABUSE of our tax money will come to a quick end!

I understand that Dave Still from the Patriot is one who seems to be bothered by the info that the town does not have the AAA bond rating. Dave, I like you. I respect you. Sometimes I agree with you and other times not. I know you feel the same way. You are entitled to this.

But Dave needs to understand other things. Dave, THIS IS OUR MONEY! We have the right to question it all, regardless of WHO thinks what! The point is that ANY town on Cape Cod could do the SAME thing. ANY town here could easily go and get a AAA bond rating. it is SIMPLE:

Just rake in MILLIONS of TAX dollars and DO NOT PROVIDE any services..... Stack millions into the free cash and stabilization account and LOOK GOOD to the bond rating folks.....

Dave, no offense but here, try this one....

Go make some phone calls Monday. Check all the other 14 Cape towns. See WHO makes their TAXPAYERS pay for school bus fees. See WHICH other town makes their kids pay for sports fees. See which other towns provide trash pickup. I know Falmouth does. Ask the other 14 Cape towns HOW MUCH free cash they have in their accounts....

If I am not mistaken, the state likes to see towns with about 5% of the budget in this account. John Klimm and his finance wizards have a hell of a lot MORE than that of OUR MONEY in this account---- and Dave, this is for ONE reason only:

TO LOOK GOOD!

So dave, I read that John Klimm is going to address a 'scary financial situation' to the town council at the next council meeting..... Gee, HOW did this happen? John Klimm's AAA bond rating was SO GREAT just a few short months ago, and NOW.....

Ooooooooops, Houston, Barnstable has this financial crisis coming.... gee what a SURPRISE!

Dave, if I am NOT mistaken, John Klimm took the steering wheeel in 2001. If I am not mistaken, the town hall $$$$PAYROLL was about 4.5 MILLION or so. Did I read somewhere lately that this is now close to $ 14 MILLION?????!!!!! HUH??

So Mr. Still, there now. I just gave you two good stories to go investigate.... One, compare Barnstable's free cash situation to the other 14 Cape towns, and two, do a story on the "GROWTH OF JOHN KLIMM's EMPIRE"!

No offense Dave, but sometimes the people here deserve far BETTER--- from both our town LEADERS, and from our local press!

This AAA bond rating is all a pack of lies as far as I am concerned!

[John Julius]

And Mr. Klimm,

as always, since you are a regular reader here, we welcome you to come in here and comment. We always enjoy the spin you and folks like President Joakim put on many issues.... but MOST people who frequent here are ten times smarter than you and your phonies....

John Klimm is nothing but a phony and the biggest hack our town has ever seen, and John, sooner or later the council folks will figure this out. To be honest, I think MOST there have but GOD forbid if they ever had to agree that the GOOD people from COG have been right all along! John, the best thing most of us are REAL GOOD at is COMMON SENSE! Something John Klimm doesn't have an ounce of.

Good day to all

the MMA probably didn't call you because they're sore at you for writing that Barnstable and other Cape towns should quit the organization because it represents Boston, Springfield, Worcester, etc.

[Gary Lopez]

That could very well be.

I still think it's a waste of money to have the same agent representing the interets of cities like Brockton, Boston, Lynn, Springfield, Worcester, Lowell, Lawrence, Fall River, New Bedford, etc. in the state house, that get billions in state aid at the expense of smaller communities like Barnstable that get $14 million.

Smaller cities and towns need their own agents at the state house.

As far as I'm concerned the MMA is stealing money from smaller communities.

Gary, go easy on the MMA. if Mr. Hack Klimm and Janet aren't allowed to go party at the MMA, they will cry... Don't they go party there every year? I bet the taxpayers would like to see that $ tab, or is it like an open bar, for free?

Your post reiterates problems that are basically standard. We're poor. What else is new?

Has anyone thought of getting Janet a debit card? If your account has no money, the bank just won't let you spend it. Not all plastic bounces.

Packing it in for Barnstable County, hoping for the best for the rest.

[Gary Lopez]

The 14 other Cape Communities, including Chatham, that also has an AAA rating, are at the other end of the financial spectrum from Barnstable.

All have town meetings and watch every penny spent by selectmen.

Ironically folks in the 14 other Cape towns have the same opinion of Barnstable that pols on Beacon Hill have; Barnstable residents are filthy rich, and spend money like water

Other towns spend 6% of municipal budget for fire protection.

Barnstable spends 30%.

Then there's the $24 million in cash reserves.

Small wonder Beacon Hill cut local aid to Barnstable in 2004 by 40%.

If you were standing on a corner handing out $100 bills to the needy, would you give any money to a guy in an Amani suit flashing a wad of bills that could choke a horse?

[John Julius]

gary, you are correct. The other Cape towns DO watch every penny spent and do what is in the BEST interests of their taxpayers. Not here....

John Klimm would not even QUALIFY to run the Town of Falmouth. They are smart enough to have "qualifications" and Johnny Klimm COULD NOT and WOULD NOT qualify to run that town.... In Barnstable, under the MORONIC current form of government, the clowns on the council could hire Donald Duck for manager and no one could stop them....here, the manager is APPOINTED and there are NO restrictions of any kind and NO certain qualifications of any kind are needed.

John Klimm came here to run the town in 2001 I believe... the government $$ payroll was about $ 4 plus MILLION, if I am accurate. Here we are in 2008 and HIS EMPIRE now rips off the taxpayers for what, close to $ 14 MILLION?! Yeah, now that is fiscal integrity and responsibility, isn't it?

Take the schools as another example. The Budget has SKYROCKETED by HOW MUCH?! And yet, the school ENROLLMENT has gone DOWN by over ONE THOUSAND and FIVE HUNDRED students.... Imagine what might happen if you owned a restaurant and last year you served 6,000 meals to patrons.. Now this year the economy is bad so you only serve 4,000 meals.... What MIGHT happen, say, if your manager went out and hired 10 new waiters and waitresses, hired a couple more assistant managers and bought new equipment for YOUR restaurant? Ah,,,, think you might go 'out of business'?!

This is putrid. We have a WASTAHOLIC manager and a clueless town council who sit week after week like "deer in the old headlights" and we have a bunch or IDIOTS on the school committee who only think they are fooling us.....

Get ready TAXPAYERS, because all these asswipes are going to come crying soon for an OVERRIDE....

Yes, I said an OVERRIDE....

So Janet, why not come whining back in here and try to defend these truths?

Actually Janet, your resignation will work good for you.... at least by the time John Klimm and the other clueless councilors come crying for the OVERRIDE, you will be long gone and won't be blamed for it....

Or Janet, you could always NOT resign and 'think' you will stand some kind of chance of being 're-elected'''

Janet, either way, YOU are long gone.....

And WHEN these MORONS come whining for an OVERRIDE, we are going to have a FIELD DAY exposing the MILLIONS of waste....

Oh, and Ann Canedey, we will also have a field day with you even thinking about WASTING a dime to buy the land at Freezer Point... Ann, in case you missed it, there is a 'recesssion' going now, and has been for some time. Ann, you might want to tune in to this and do some GOOD for a change! MONEY does NOT grow on trees Ann.

[X]

It's 8:00 AM on the first day of the month. Do you know where your Mary is?

Taunton, I hope (for her sake).