Amityville credit rating takes hit
Standard & Poor's downgraded its rating of Amityville's debt this week to a notch above junk bond status, pressuring village officials to close a running deficit and shore up reserves.
The move could make it more expensive for the village to borrow money.
"The downgrade is due to the continued deterioration of the village's financial position and the absence of a meaningful plan to reverse the trend," S&P officials said Monday. Their report noted a $742,000 deficit at the end of fiscal 2012 and questioned the village's ability to repay $1.45 million in notes due in May.
"We have not and will not default on any of our debt instruments," Amityville Mayor Peter Imbert said Tuesday.
Imbert, who plans to step down this spring, said next year's budget will include a surplus that reduces the deficit and will limit borrowing. The budget will almost certainly call for a property tax increase higher than 2 percent, he said, and could also introduce savings by increasing the health care contributions paid by new police officers, though that must be negotiated.
Imbert claims that much of the deficit could be erased if Suffolk County and a local developer make good on their obligations to the village. The county owes the village $200,000 to $400,000 for costs associated with building Nautical Park, he said; and Wellington Park Villas, a condominium project fronted by developer Gary Passavia, owes $442,000 in fees.
But the county's agreement to cover park costs was based on a verbal agreement under former Supervisor Robert J. Gaffney. Wellington Park Villas is in foreclosure and due to be auctioned this month.
S&P also warned of "significant pressure in light of property tax limitations, high fixed charges, and limited ability to reduce personnel costs."