Fitch Ratings has given a ‘AAA’ rating to $18 million in debt the town of Guilford plans to issue next week, but the debt-rating agency is raising concerns about the shoreline municipality’s future creditworthiness.
Guilford is preparing on Wednesday to issue the series 2010 general obligation bonds on top of three issues of outstanding debt totaling $25 million. Fitch also gave a ‘AAA’ rating to that debt.
However, Fitch says its negative outlook reflects the decline in the town’s overall financial flexibility in recent years that has forced it to draw on unreserved fund balances to pay its bills — a situation facing many Connecticut municipalities.
In Guilford’s favor, Fitch said, is its moderately low debt, good school system, low unemployment, above-average wealth, and proximity to regional job markets, such as Hartford, New Haven and Stamford.
