Towns with a higher bond rating are more likely to be able to pay off their loans, and as such are often given a lower rate of interest on their bonds.
"On smaller projects, a few (percentage) points isn’t going to matter too much," said Ballantine. "But if you’re building a high school, it can make a significant difference."
Much like there are three main credit bureaus for personal credit scores, there are three main bond rating agencies — Moody’s Investors Service, Standard and Poor’s, and Fitch Group.
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Franklin has been able to maintain a very good bond rating with its overall budget management. This will be a major factor as the new high project goes out to bid for the bonds to finance the building. Of course, the timing for the actual construction bids will hopefully produce the lowest overall cost for the project as well.
Franklin is also aggressive in managing its debt to take advantage of the lowest ratings available. It was able to perform two refinancing exercises that substantially reduced the amount of interest that would be paid over the life of the bond. The most recent of these efforts was reported on during the FinCom meeting in April