Standard & Poor’s upgrades Richmond’s bond rating

Standard & Poor's has upgraded Richmond's bond rating, citing in part a strong economy.

Standard & Poor’s has upgraded Richmond’s bond rating based on the strength of the local economy and the city’s financial performance.

The upgrade from AA-  to A+ should lead to lower interest rates and less cost to the city when it borrows money in the future.

“Typically, higher bond ratings mean that the city’s cost of borrowing goes down,” Councilman Tom Butt said in his e-forum about the rating.

S&P announced the rating upgrade last week, at the same time bumping up the city’s lease rating.

S&P revised the way it rates local governments last year. The new method places most of the weight of a rating on the strength of the local economy, a little less on city management and even less on its budgetary performance, budget flexibility and liquidity.

In its assessment of Richmond, S&P cited the city’s economic condition, its adequate budget performance and its financial flexibility. S&P also recognized the city’s small debt and liabilities profile.