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Connecticut News

S&P, Fitch Downgrade New Haven's Bond Rating

Jessica Hill
New Haven Mayor Toni Harp

Two credit rating agencies have downgraded the city of New Haven’s bond rating.

This comes as the city is set to sell $58 million in bonds for new infrastructure projects and $160 million to pay off existing bonds.

Mohit Agerwal, chair of the city's Financial Review and Audit Commission, says the lower bond rating from S&P and Fitch could lead to higher interest rates that would force the city to spend more on debt in the long run.

“It’s like opening a new credit card. We’re opening a new credit card, taking $160 million on that credit card because that credit card’s got a more lenient payment cycle, and then using that to pay down the current debt.”

S&P says its lower rating came from the city’s weak management and its limited long-term financial forecasting. The Mayor’s office says it wasn’t able to forecast that the last state budget would come in late with less-than-expected grant funding.

New Haven faces a $15 million deficit for the last fiscal year and Agerwal is projecting a $30 million deficit this fiscal year. New haven has raised its mill rate by 11% to close its deficits. 

This story was updated to reflect a detailed description of the bonds the city of New Haven is planning to issue in August, and the city’s budget deficit for both the last and current fiscal years.