Massachusetts.

The Cape Cod city of Falmouth, Mass., was upgraded last week to Aa from A1 by Moody's Investors Service because of favorable credit factors and a positive financial position.

The upgrade comes as the city readies for this Thursday's scheduled competitive sale of $4.3 million of bonds.

"All through this recent recession, the city has been able to manage its finances responsibly," said Karl Jacob, an assistant vice president at Moody's. "It was always considered to be a strong A1 credit."

Javoc said that the city has a $4 billion tax base and a very high valuation per capita. A release from Moody's said that about 60% of the town's outstanding debt is exempt from Proposition 2-1/2, another favorable rating factor. Proposition 2-1/2 limits the amount a town can raise property taxes during any given year.

The city's leadership has also taken the initiative in creating conservative budgets through periods of diminished state aid, Jacob said. The city has only about $18.3 million of outstanding debt.

In addition, Jaboc said, the large average wealth of owners of second homes in Falmouth contributes to the high rating.

A release from Moody's said that although a fairly large percentage of the town's residents are retirement age, those residents have fairly high wealth levels.

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