As some push to weaken the powers of Buffalo's control board, a major Wall Street agency has boosted the panel's bond rating.
Fitch Ratings said the city's improving financial health has prompted it to increase the Buffalo Fiscal Stability Authority's credit rating by a notch. Higher bond ratings generally translate into lower borrowing costs.
"The upgrade to 'AA' reflects the demonstrated effectiveness of the BFSA in assisting in the recent improvement of the fiscal condition of the city," Fitch analysts said in a written statement.
The upgrade came one month after officials from the city and the control board engaged in a public duel over whether the board should continue to borrow money on Buffalo's behalf. City officials hope to return to selling their own bonds in future years, noting Buffalo also saw two Wall Street agencies boost its credit rating in the past year. While Buffalo's rating is still lower than the control board's, city analysts have argued that the substantial savings Buffalo incurred in prior years by using the board's borrowing clout is now a negligible amount.
Officials reached a consensus that the control board should proceed with plans to sell up to $30 million in bonds this month to fund city capital projects. But Mayor Byron W. Brown has vowed to push for control board passage of a resolution giving the city the option to decide whether it will seek control board involvement in future borrowing.
Control board Executive Director Dorothy A. Johnson wouldn't speculate Thursday on how the rating upgrade might shape the debate. But she said it's understandable why city officials want to reclaim their borrowing powers.
"Clearly, the city is eager to get back to standing on its own two feet," Johnson said.
Officials in City Hall said the credit upgrade by Fitch is another sign that Buffalo's finances continue to move in the right direction.
"Any positive news for Buffalo is positive news," said city Finance Commissioner Janet Penksa.
City Comptroller Andrew A. SanFilippo said Fitch's conclusion that Buffalo's fiscal health is improving only strengthens the argument that after nearly four years of being under the watchful eye of a control board, the city is moving closer to regaining "self-determination."
"Control boards are not meant to last forever," SanFilippo said.
On Tuesday, the Common Council endorsed a bill that's pending in the State Senate to rein in the control board's power to freeze wages and block new hirings. The bill, sponsored by Buffalo Democrat Antoine M. Thompson, would bar the board from taking such actions if the city adopts a balanced budget, makes timely payments on its bond debts and doesn't incur operating deficits of more than 1 percent in any operating fund.
It has been three years since the control board voted to freeze the salaries of all city and school district employees, an action that has triggered numerous lawsuits and, according to some union leaders, caused major morale problems.