The city of Portland has received the highest credit rating possible from one of the largest and best known credit rating agencies in the United States.

Standard & Poor’s Global Ratings raised its credit rating on all of Portland’s general obligation debt to AAA over the weekend, the city said on Thursday. The city’s credit rating had been AA+.  The S&P rating is a credit score that describes the general creditworthiness of a business or government entity that issues debt.

A higher credit rating helps a municipality borrow money by issuing bonds because investors can be assured the interest will be paid and the risk of defaulting is low. The AAA rating should reduce borrowing debt on Portland’s bond service costs, create additional demand for city of Portland municipal bonds, and could potentially save the city millions of dollars in years to come, the city said in a statement.

S&P attributed the credit rating bump to continued growth in the local economy, strong financial management and financial policies, and well managed debt metrics. AAA represents the highest measure of creditworthiness a city or town can receive from S&P.

“It will save the city millions of dollars in debt service costs down the road and Portland joins a small handful of communities in New England who hold the AAA rating,” Portland Finance Director Brendan T. O’Connell said in an email. O’Connell said the credit rating boost is only the second upgrade in the city’s history, with the last upgrade occurring in 2017.

“We couldn’t be more thrilled to announce this incredibly important milestone,” he said. “The upgrade to AAA will save local property taxpayers millions of dollars on future debt issuance and makes a statement about how strongly we take our fiscal management responsibilities.”

City officials said the reduction in debt service costs are expected to have a significant impact on the municipal budget. The city estimates that the new rating will save Portland between $520,000 and $780,000 on this week’s $51.9 million municipal bond sale.

“It is wonderful to receive this prestigious AAA rating from the S&P,” Portland Mayor Kate Snyder said in a statement. “It reinforces the great work our finance staff has done to strengthen the city’s profile and highlights the growth we’ve had in the local economy over the last several years.”


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