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Special Events and Honors

Posted on: January 15, 2020

Moody’s Assigns AAA Credit Rating and Standard & Poor’s Assigns AAA Rating, both with Stable Outlook

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Town commended for a strong management team and fiscal policies

Farmingville, NY - Supervisor Ed Romaine is pleased to report that Moody’s Investor Services has re-affirmed the Town of Brookhaven’s AAA credit rating. In addition, Standard & Poor’s assigned their own rating of AAA. Both indicated a “stable outlook” for the Town’s fiscal position. The ratings are the highest issued by the two services and identifies the Town’s financial position as the highest quality and lowest credit risk. The credit ratings were issued in conjunction with the Town’s planned $68 million General Obligation Serial Bonds sale this week. The ratings are in the top tier of both agency’s ratings category and considered high quality investment grade. A town’s credit rating is an important and reliable indicator of its fiscal health determined by independent and objective fiscal monitors. A higher credit rating saves the town money on its borrowings in the form of lower interest costs.

Supervisor Ed Romaine said, “These reports show that we continue to perform at a very high level of fiscal responsibility, and I thank every Town department for helping to keep us on the right course. I commend Commissioner of Finance Tamara Branson, Chief of Operations Matt Miner and Councilwoman Jane Bonner for working hard to save millions of taxpayer dollars today and in the years ahead.”

Councilwoman Jane Bonner, who serves as the Town Board Liaison to Finance said, “Supervisor Romaine has shown great leadership to maintain our strong financial position, while the conservative fiscal policies that the Town Board has implemented continue to move us in the right direction. The real winners are the Brookhaven taxpayers who should know that we are doing the best that we can to protect their interests."

In Moody’s report, their Ratings Rationale noted the Town’s “continued strong financial management” and a “manageable debt burden that is not likely to increase significantly in the next twelve to twenty-four months.” It also indicates that the Town’s stable outlook “reflects the expectation that reserves, and liquidity will remain sound.”

In Standard & Poor’s summary, they identify the Town’s strengths as:

  • Very strong economy, with access to a broad and diverse metropolitan statistical area (MSA) and a local stabilizing institutional influence;
  • Very strong budgetary flexibility, with an available fund balance in fiscal 2018 of 44% of operating expenditures;
  • Very strong liquidity, with total government available cash at 64.7% of total governmental fund expenditures and 3x governmental debt service, and access to external liquidity considered to be strong; and
  • Strong institutional framework.

The S&P report indicated that the highlights of the Town’s policies and practices include:

  • A well-defined five-year capital improvement plan (CIP) updated annually;
  • A debt management policy of maintaining debt service carrying charges at 15% or below of revenue or expenditures, whichever is less, and a formal fund balance policy of maintaining a general fund balance of at least 25% of expenditures and adherence to the state’s investment policy;
  • The town’s financial position continues to improve as evidenced by recent surpluses, reduced reliance on fund balance to bridge any structural imbalances, tighter cost control measures, and establishing new revenue streams;
  • The Town’s access to external liquidity is strong, having issued bonds and notes frequently over the past twenty years, with an adequate debt and contingent liability profile; and
  • As a result of historically very strong reserves and formal reserve policy levels, S&P does not expect budgetary flexibility to deteriorate.

The Standard & Poor’s also commented that they view the Town’s management as “very strong, with strong financial policies and practices under our Financial Management Assessment methodology, indicating financial practices are strong, well embedded, and likely sustainable.”

Division of Public Information * Office of the Supervisor
One Independence Hill • Farmingville • NY 11738 • Phone 631-451-6595

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