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Wall Street analysts get rosy overview

When Wall Street analysts came to Buffalo several summers ago, then-Mayor Anthony M. Masiello gave them a tour that would have made Clint Eastwood proud.

"We wanted to show them the good, the bad and the ugly," Masiello said.

When two analysts from Moody's Investors Service visited Buffalo for the first time Tuesday, their City Hall hosts played down the bad and the ugly.

In hopes of seeing Buffalo's credit rating move up another notch, officials invited Moody's analysts to the city so they could meet with developers, elected leaders and finance experts, then visit some major projects that are under way.

The tour included the Buffalo Niagara Medical Campus, the new HealthNow New York headquarters complex, downtown housing projects, the waterfront and neighborhoods around Delaware Park. Uniland Development also hosted a luncheon.

Patrick C. Mispagel, a Moody's vice president, and Lisa Cole, an assistant vice president, said analysts periodically visit municipalities so they can see conditions firsthand.

As a practice, analysts do not publicly air their gut feelings after site visits, but City Comptroller Andrew A. SanFilippo, who helped coordinate the itinerary, thinks things went well.

"There's a lot of economic development that's occurring, and we wanted to give them a chance to see the progress that's being made," SanFilippo said.

Mayor Byron W. Brown and some key advisers also met with Moody's officials to review what Buffalo's state-appointed control board has described as the city's improving fiscal health. Buffalo's surplus grew by $16.9 million in the 2005-06 fiscal year to an accumulated balance of $56.1 million. City officials expect reserves to grow even larger when an audit is completed for the fiscal year that ended June 30.

In February, Moody's raised Buffalo's credit rating one notch to its highest level in six years. Analysts cited "conservative budgeting" as a key factor in engineering what Mispagel called a "significant turnaround from where we've seen the city."

Still, the Baa2 rating remains below the median rating for municipalities nationwide.

Moody's warned that the impact of future contract settlements with city unions and the effects raises might have on finances would be key factors in future reviews. A wage freeze that the control board imposed in April 2004 was lifted two weeks ago.

Last December, Standard & Poor's also raised the city's credit rating one step. The higher a municipality's rating, the less expensive it is to borrow money.

It was not immediately clear when Moody's might make a decision on Buffalo's credit rating.


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