Farmingville, NY – –Supervisor Ed Romaine and Deputy Supervisor Dan Panico announced today that S&P Global has assigned the Town of Brookhaven its AAA credit rating and stable outlook to the Town’s upcoming April bond sale. S&P Global’s AAA credit rating, the highest designation that the agency issues, is an important and reliable indicator of the Town’s 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.
In the March 24 report, S&P Global viewed the Town’s management policies “as very strong, with strong financial management policies and practices coupled with a consistent ability to maintain balanced budgets.” Highlights include management’s:
- Well-defined, five-year capital-improvement plan, which it updates annually;
- Budget monitoring;
- Formal budget amendment policy;
- Long-term financial forecasts, which update annually as part of the budget process;
- Debt-management policy of maintaining debt service carrying charges at 15% or below budgeted revenue or expenditures, whichever is less; and
- Formal fund-balance policy of maintaining a general fund balance of at least 25% of expenditures.
The S&P Global states that Brookhaven’s stable finances, supported by a growing local economy and strong financial-management practices, policies under our Financial Management Assessment (FMA) methodology with an emphasis on long-term capital and financial planning. Ongoing property tax development and investment in leading employers will likely support revenue as the Town continues to reduce its reliance on landfill revenue.
The Brookhaven Town’s AAA rating reflects S&Ps view of the:
- Growing local economy, evidenced by significant residential and commercial development townwide with access to the New York City metropolitan statistical area;
- Comprehensive formal financial management policies, practices S&P considers strong under (FMA) methodology and strong institutional framework score.
- History of strong budgetary performance with very strong reserves; and moderate debt with rapid amortization and manageable pension and OPEB (Other Post-Employment Benefits) costs.
- The stable outlook reflects S&P Global Ratings view that the Town of Brookhaven will likely maintain strong overall finances throughout the two-year outlook supported by a strong economy and manageable fixed-cost debt.
- Ongoing property tax base development and investments in leading employers will likely support revenue as the Town continues to reduce its reliance on landfill revenue
- Brookhaven Industrial Development Authority has numerous ongoing projects that will spur sizable investments in the town and create thousands of jobs. It is expected that the local economy will likely continue to expand and remain very strong
The S & P Global summary also indicates that Brookhaven’s GO bonds are eligible to be rated above the sovereign because they think the town can maintain better overall credit characteristics than the nation in a stress scenario. Fiscal 2022 projections continue the Town’s positive trend with revenue outpacing expenses despite some onetime expenditures incurred. The report reflects S&P Global’s opinion of the Town’s AAA Credit Rating with select key credit metrics, including:
- Very strong economy
- Strong budgetary performance
- Very strong budgetary flexibility
- Very strong liquidity
- Very strong management
- Adequate debt and long term-liability position
- Strong Institutional Framework
Supervisor Ed Romaine said, “The Town continues to perform at a very high level of fiscal responsibility, and it clearly shows in S&P Global’s report that we are on the right course for the future. I’d like to thank Deputy Supervisor Dan Panico; Commissioner of Finance Tamara Branson, and Councilwoman Jane Bonner for the work they do to strengthen the Town’s finances. We have saved millions of taxpayer dollars and will continue to remain on this track well into future.”
Deputy Supervisor Dan Panico said, “I commend my colleagues on the Town Board and Supervisor Romaine for their support as we continue to improve our financial stability. The real winners are the Brookhaven taxpayers who want to make sure that their hard-earned money is being spent wisely and that we are doing the best that we can to protect their interests."
