Moody’s Upgrades Rockland County’s Ratings Amid Coronavirus

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Upgrade Reflects County’s Improved Financial Position That Is Being Challenged With Coronavirus Hits

By Tina Traster

Moody’s Investors Service on Monday increased the rating to Rockland’s Various Purposes Bonds and Refunding Bonds to A1 from A2. They also upgraded to A1 from A2 the County’s issuer and general obligation limited tax ratings.

The “Series A Bonds” will provide $19.9M in new money for various capital projects around the county. The “Series B Bonds” are refinancing $24.1 million from 2010 and 2012 bond obligations on more favorable terms.

The 2020 bonds and the currently rated long-term debt are secured by the town’s general obligation pledge as limited by New York State’s Property Tax Cap-Legislation.

The upgrade of the issuer rating to A1 reflects the county’s recently improved financial position, which is being challenged with sales tax and state aid losses as a result of coronavirus, according to Moody’s. The rating further incorporates state oversight of budgeting, a large tax base, average socio-economic position and moderate long-term liability profile.

Moody’s also stated the coronavirus crisis is not a key driver for this rating action.

“We do not see any material immediate credit risks for Rockland County,” according to the report.

Sales tax revenues for the year have been down over 8 percent and the governor is holding back 20 percent state aid, which is putting pressure on the county’s budget. “This is offset by management’s conservative budgeting, particularly for sales taxes,” the report says.

However, the situation surrounding coronavirus is rapidly evolving and the longer-term impact will depend on both the severity and duration of the crisis. Factors that could lead to a downgrade of the ratings include an inability to maintain reserves at current levels as well as a return to structuring imbalanced budgets including the amortization of pension payments

“To receive this type of news during a financially devastating pandemic is incredible and speaks to the work we have done over the last 6 and a half years to right Rockland’s fiscal ship,” said County Executive Ed Day.

The stable outlook reflects the county’s healthy reserve position and conservative budgeting that will offset pandemic related revenue losses.

Moody’s does not see any material immediate credit risks for Rockland County, according to the report.

“I want to thank all of our hardworking employees who have learned to do things differently, often more efficiently over the years,” Day added.