RFP Staff
♦ Fitch Ratings Inc. is one of the “Big Three credit rating agencies, the other two being Moody’s and Standard & Poor’s. It is one of the three nationally recognized statistical rating organizations (NRSRO) designated by the U.S. Securities and Exchange Commission in 1975. (From Wiki) “Businesswire” reported recently that the City of Salisbury’s water and sewer bond rating was affirmed stable at A+, which is good news for those residents of Salisbury and other local municipalities hooked into Salisbury-Rowan Utilities.
Fitch has one caveat to their rating: “Support of Fibrant: Resumption of financial support of Fibrant, the city of Salisbury’s broadband system, could result in negative rating action.”
Fitch confirms previous Rowan Free Press reports that $7.6 million dollars was “borrowed” from SRU funds to support Fibrant (counter to the city’s promise not to do so to the NC Legislature when Fibrant sought an exemption from the Broadband Bill). Additional funds are being spent on legal counsel for the lawsuit against Atlantic Engineering for the botched Fibrant construction in violation of the National Electric Safety Code. (This case remains in litigation.)
Fitch further confirms that Salisbury’s General Fund is currently supporting Fibrant. RFP readers will remember that incumbents Maggie Blackwell, Karen Alexander, and Brian Miller denied that general fund support existed for Fibrant during the last election while instead touting a new 10 Gig speed that has pulled in zero customers even after significant expenditure on the city’s part.
Previous city management led the charge to stop inter-fund loans to Fibrant from SRU and as a result Salisbury Rowan Utilities is financially sound per Fitch’s stable rating outlook.
Rowan Free Press was the first news outlet to expose the city’s General Fund support of Fibrant during the past municipal election through a series of videos. Subsequently, the city revealed that Fibrant was losing $10,000 dollars per day and had annual General Fund support of Fibrant in excess of $3M per year.
Current City Council Members Maggie Blackwell and Brian Miller voted each year to raid SRU cash to support their failing broadband system and have since voted to support the same failing system with General Fund contributions. During the process their votes have caused losses in excess of $13 million dollars between both funds, funded by your monthly water bill and annual tax bill.
http://www.businesswire.com/news/home/20160831006010/en/Fitch-Affirms-Salisbury-NC-Water-Sewer-Revs
