Moody's of Wall Street upgrades EP to an "A" Rating

In a press release from the City of East Providence web site, city officials announced in August that the all important bond rating from Wall Street continues to climb. "The City of East Providence now finds itself in an elite new category among Rhode Island municipalities according to Moody’s Investors Service. Moody’s has officially upgraded the City of East Providence to an A rated investment level. As recently as 2013, the City was considered to be in junk bond status carrying a high default risk," said city officials.

Some four years ago the city seemed in financial turmoil. A budget deficit of upwards to $20 million was putting the city in financial ruins. Jobs were cut, schools were closed, maintenance of city infrastructure, already slowed, was totally stopped. Streets, playgrounds, police, fire and other staff were targets of budget slashing. The budget commission had all but ordered the city to close down an elementary school, selecting Oldham School on Bullocks Point avenue. Oldham exists today, but at the site of the former Meadowcrest School on Bart Drive in Riverside.

The state budget commission controlling East Providence's finances held its first two meetings in a small conference room in city hall in late December of 2011. The meetings were held in the morning on December 28th and 29th with no advertised notice to the general public. Former Mayor Bruce Rogers said at the time that he "wants all meetings to be open to everyone," as he remained upset with the state takeover process. Rogers had insisted that the city has closed the deficit under new city manager Peter Graczykowski and wanted more info from state officials on why the budget commission was put in place at this time. But Major Stephen Bannon, fiscal overseer, said that it relates to East Providence's cash flow problem. State Director of Revenue Rosemary Booth Gallogly said at the time that "this commission does not have to post all of its meetings - especially organizational ones - with the public."

And so it continued. Middle school sports, coaches salaries, playgrounds within neighborhoods, street lights and much more were all on the state's chopping block. Much has happened since the state takeover. City Manager Graczykowski was eventually fired, a new police chief was appointed and once the budget commission left, the city council brought back former manager Paul Lemont as Interim City Manager. Lemont holds the post today as the council is currently interviewing for a permanent manager.

With the state commission gone accept for a part-time financial overseer, Paul Luber, and the former deficit totally wiped out, some question the prior need for the budget commission. Paul Lemont is one who doesn't think we needed it. "We didn't need them (budget commission). The reason we got into financial difficulty was poor management in this city," Lemont told the Reporter in late August. "Effective, proper management could have avoided this whole financial mess," said Lemont. Lemont also thought some of the budget commission decisions hurt the city. "By not filling vacancies in the fire and police departments, we were getting killed with overtime costs. Plus I took no pleasure in workers having 70 hour work weeks. The effect on this city was deleterious ," said Lemont.

“Through hard work and financial discipline from the elected officials, City management and City employees, the City has elevated itself from junk bond status to the elite tier of A-ranked municipalities. This is what the taxpayers of East Providence deserve,” said Lemont. According to Moody's not only has the City’s bond rating increased, it has jumped an unprecedented two steps, which is well above the norm for Moody’s. According to Moody's, “the City’s continued trend of financial improvement over the last three fiscal years has significantly increased its reserve and liquidity levels through adherence to its formal fiscal policies. Further, the rating reflects the reduction of the City’s unfunded liability in its self-administered pension plan as a result of improved funding practices.”

“On behalf of the City Council, I would like to express my great pleasure at this recognition by Moody’s of the remarkable financial turnaround which the City has undergone. This is a testimony to the dedication of my fellow City Council members and the City employees to careful fiscal management that keeps the needs of the residents’ first and foremost,” said Mayor Thomas Rose.