Rockland Sells $96 million Bond to Apply to $145 Million Deficit

County Executive Ed Day's first priority, he told everyone candidly in his first State of the County speech last month, was tackling Rockland's $145 million deficit—and its underlying causes.

Consolidating services, cutting spending and selling the county's Summit Park Nursing Care facility were all on his list.
 
But first and foremost—essential to buy time for everything else—was a plan to take out the government equivalent of a consolidation loan by floating a $96 million deficit bond.

“The sale of the hospital and the bond will buy us extremely limited time to implement a series of aggressive changes that will make us more efficient,” said Day on Feb. 3. “We must never return to the irresponsible budgeting practices of the past, and we won’t. This I promise.”

The county's been borrowing, over and over, to pay its bills and keep the government operating. The costs associated with each loan have also been adding up. 

The next step in the fiscal recovery plan was achieved March 4 when the county successfully negotiated the $96 million bond sale at a low interest rate, county officials announced.

Here's the text of the press release:

Rockland County received a low 2.70 percent interest rate for the General Obligation Bond Sale on its $96 million deficit financing bond for the Series 2014A held Tuesday, March 4. The negotiated sale was oversubscribed by four to six times.
There were several prominent bidders including Goldman Sachs, Fidelity, Alliance Bernstein, Putnam Funds, Eaton Vance, T. Rowe Price, Wells Fargo and Federated, indicating strong institutional support of the County’s bond offering. 
“I am strengthened by the County’s successful bond sale at such a low interest rate,” said County Executive Day. “Bidding by major Wall Street investment firms clearly demonstrates that our early efforts to restore the County’s fiscal stability are being recognized by the market.”
The bond offering was aggressively bid and re-priced to generate a total of $107. 46 million to the County. This difference represents a premium on the County’s investment generated by the buyers of $11.46 million. This amount will further enable the County to reduce our deficit fund balance.
The sale validates Rockland County’s current responsible management and fiscal stewardship.
Said Day, “The successful bond sale is an example of unified governance. My Administration continues to work collaboratively with the Legislature to move our County beyond these difficult fiscal times. We put together an excellent team led by Roosevelt & Cross, Inc., co-managed Academy Securities and Siebert, Brandford Shank and Company.”
Rockland County has historically been one of the most creditworthy counties in New York State. Rockland is home to a well-diversified, wealthy economic base that provides ample support for its sizable needs. Service requirements are high, reflecting the desires of our people and the mandates imposed by the state.