by Neil W. McCabe

Mayor Joseph A. Curtatone announced the city realized more than $800,000 in present value savings by exercising a one-time chance last week to refinance some of its outstanding bonds.

“Our strong fiscal management and our push for economic development at Assembly Square, combined with the low interest rate environment allowed us to realize this windfall,” the mayor said.

“We will continue to run a tight ship while we endure the state fiscal crisis,” he said.

The bonds were issued the day after Moody’s Investment Services gave the city a positive outlook and an A2 rating, citing the administration’s well-structured management initiatives that include long-term financial and capital planning, he said.

The city has been waiting for the right time to do this because we can only do it once, said John McGinn, the city’s treasurer.

The report also noted the potential for economic growth and increased tax revenue, said McGinn. The bonds are general obligation bonds.

The positive report comes at time when other local communities have been given negative evaluations as they deal with cuts in state aid and other financial strains, he said.

“We are by no means out of the woods when it comes to fiscal pressures,” said Curtatone. “But we’re facing the music, making cuts and pushing hard for new growth. It’s paying off.”

The city sold $10.355 million in so-called “refunding bonds” on Wednesday, cutting $805,219 in current and future payments on the overall debt service of the city. The city will realize $355,454 of the savings in the current fiscal year (FY04). The remainder will be realized in $40,000 – 50,000 annual debt service reductions over the next 12 years.

Curtatone lauded the city’s financial team for seizing the one-time opportunity to cut costs for the city.

“Given the fiscal pressures we face this year, this is a huge bonus,” he added. “We’re fortunate to have real professionals running our city’s fiscal operations.”