Moody’s Rating Service improved its
outlook on Rockland County bonds on Tuesday evening. Moody’s revised its
outlook from negative to stable for two issues of bond totaling $13 million.
The county is expected to sell the bonds on Thursday.
The bonds for $5 million and $8 have been assigned a Baa3 rating.
Moody’s said the revised rating takes into account the county’s budget deficit and tight financial position but noted Rockland’s fiscal situation is expected to improve.
The company explained the reasons for the upgrade.
The stable outlook reflects our expectation that the county's liquidity and reserve position will significantly improve in the near-term given legislation recently approved by the state allowing the county to issue deficit reduction bonds. Management has proactively managed the reduction of an accumulated fund balance deficit with recurring revenue enhancements and expenditure reductions; year-to-date results indicate a positive trend. Losses at the nursing home and mental health facility continue to pressure the county's financial position, however.
The state authorized Rockland to borrow $96 million to reduce its budget deficit. However, the deficit at the end of 2013 is expected to reach $140 million up from $128 million at the end of 2012. The county’s bond rating had been one level above junk bond status.
Senator David Carlucci said the state oversight requirement written into the deficit funding bill was instrumental in getting the improved rating.
"The report issued tonight by Moody's, the credit rating agency, has upgraded Rockland County's financial outlook from negative to stable in large part due to fiscal oversight in the deficit financing bill, is very good news for Rockland taxpayers,” said Carlucci. “This is the start of a long process to get Rockland County back on the right financial track."