Syracuse, N.Y. — In the aftermath of a contentious budget battle between Syracuse Mayor Ben Walsh and the city’s lawmakers, a major municipal credit rating agency is giving the city a strong financial review.
Moody’s Ratings on Friday issued an A1 bond rating with a stable outlook for the city. Among several factors, the agency cited Syracuse’s strong base of reserve funds, which became a point of division in this year’s budget process.
“The A1 issuer rating reflects the city’s solid financial position with available fund balance of approximately 33% of revenue at the close of fiscal 2024 and considerable growth prospects,” Moody’s stated in a news release. “These positive factors, coupled with proactive management, help offset some notable credit challenges such as weak resident wealth and income (resident incomes were 61% of the US in the most recent year). The city remains the economic hub for a substantial portion of upstate New York … and benefits from a substantial medical and education presence.”
The A1 rating was the seventh straight for Syracuse and is considered among the top tier of municipal ratings. Higher bond ratings help the city’s budget because they lead to lower interest rates when the city borrows money.
The common council last week unanimously finalized a 2025-26 city budget that cut $16 million from Walsh’s proposal and eliminated a 2% property tax rate increase. The council budget reduced the expected use of city reserves from $27.2 million to $14.3 million.
Walsh said the cuts were “draconian and dangerous” and made without property consultation, while councilors insisted they needed to control spending to avoid fiscal insolvency in a few years if similar fund balance draws took place.
“Moody’s objective assessment of Syracuse’s fiscal condition contradicts misrepresentations made recently about impending fiscal peril for the City,” Walsh said. “Moody’s closely follows the challenges we face and how our team manages city finances. Their determination supports the fact that under this administration, Syracuse is in better financial health than it has been in decades.”
Common Councilor Corey Williams, who chairs the legislative body’s Taxation and Finance Committee, said the Moody’s report’s emphasis on the importance of maintaining a healthy fund balance reinforces the reasoning behind this year’s budget cuts. Williams noted that Moody’s set 30% of revenue as a fund balance threshold that could lead to a negative outlook for the city.
“We’re pretty darn close to that number,” he said. “We consider this as a validation that the council did the right thing for the city’s fiscal health.”
Moody’s does note that the council-approved budget for the upcoming fiscal year, which starts July 1, included spending cuts and lower use of fund balance.
It also cites the Micron Technology semiconductor manufacturing campus planned in the northern suburb of Clay as a reason to expect economic growth in the city. Another strength cited is the growing value of Syracuse’s tax base.
City reporter Jeremy Boyer can be reached at jboyer@syracuse.com, (315) 657-5673, Twitter or Facebook.
