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Moody's Investors Service Calls Governor Lincoln D. Chafee's New Shared Services Task Force a "Credit Positive" for Struggling Cities

Moody's: Task Force Will Likely Achieve Efficiencies, Savings

Providence, RI - Moody's Investors Service, a global provider of credit ratings, research, and risk analysis, last week praised Governor Lincoln Chafee's recent Executive Order creating a municipal shared services task force for the cities of Central Falls, East Providence, and Pawtucket.

Moody's stated that the formation of the task force is "credit positive for these financially challenged cities because it will likely lead to operating efficiencies and save operating costs."

"I am pleased that Moody's has noted our ongoing efforts to find new and innovative solutions to the significant challenges facing Rhode Island's cities and towns," Governor Chafee said. "The State of Rhode Island and our economy as a whole cannot be successful if our municipalities are not fiscally healthy, and in these difficult economic times, we must seriously explore shared services as a viable option for savings and efficiency."

"It's always gratifying when you can undertake something positive for the taxpayers which also prompts a positive response from the credit markets," said Pawtucket Mayor Donald R. Grebien, who the Moody's report noted had asked the Governor to create the task force. "The key will be how we can best implement the task force findings but I am confident that shared services will be a plus for every community involved and I look forward to working on getting those changes in motion."

Governor Chafee established the task force on June 28, and has designated John Simmons, Executive Director of the Rhode Island Public Expenditure Council (RIPEC), as its Chairman. The 5-member panel will also consist of Rhode Island Director of Revenue Rosemary Booth Gallogly and the Mayor of Pawtucket, the City Manager of East Providence, and the Central Falls Receiver, or their designees.

The task force will develop strategies to "share public services among the cities in order to exploit economies of scale and reduce costs to combat revenue pressures." In addition to public works, the panel will examine "other similarly appropriate areas of municipal government" for shared services potential.

The fiscal health of Rhode Island's communities has been a key priority of Governor Chafee's Administration. Since taking office, the Governor has fought to comprehensively address the crisis occurring in the state's cities and towns. In the most recent session of the General Assembly, he introduced a bold municipal reform and relief legislative package that included reform of Rhode Island's failing municipal pension systems, greater accountability for school spending, and relief from some of the most onerous state mandates. Governor Chafee has also made the Rhode Island Department of Revenue and its Director, Rosemary Booth Gallogly, available as a resource for municipalities experiencing difficulties. The state has formally intervened in Central Falls, with a Receivership, and East Providence, with a Budget Commission, and the Department of Revenue's Division of Municipal Finance is assisting a number of other communities as they work to achieve lasting stability.

Moody's noted that the sharing of services among local governments is common in many states and often includes refuse collection; snow removal; 911 emergency dispatch; vocational and technical education; and water and sewer service, among other areas.

Related links

Department or agency: Office of the Governor

Online: http://www.governor.ri.gov

Release date: 07-16-2012

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