Town of Babylon drops Fitch Ratings agency
A bond ratings agency has simultaneously given and withdrawn a rating for the Town of Babylon, after the town dropped the agency.
Fitch Ratings, Inc. gave the town an AA- rating on $93 million in general obligation bonds, as well as an outlook rating of "stable." The rating is the company's fourth-highest out of 20 possible ratings.
Town spokesman Andrew Berger said Babylon decided to drop Fitch because it already pays for two other ratings agencies, Standard & Poor's and Moody's. Standard & Poor's most recent rating for the town is AA+ and Moody's is Aa2.
The town has used Fitch for the past 20 years, most recently in 2011, when it paid the agency $18,000, Berger said. In 2012, the town paid Standard & Poor's $18,000 and Moody's $13,250, he said.
In its analysis of the town's debt, Fitch notes Babylon's "significant investment" in its Wyandanch Rising revitalization project and the "property held for resale" in its general fund. "The ability of the town to convert those assets to cash will determine the direction of liquidity in the general fund going forward," the report states. The town has spent nearly $28 million to acquire properties in Wyandanch, Berger said, and anticipates spending an additional $500,000 to $1.5 million on property acquisitions in the future.
Wyandanch Rising is the town's $500 million public-private downtown redevelopment project that has been more than a decade in the making. A critical component of the plan, the installation of a sewer line down Straight Path, is expected to be completed within the next few months. Construction on the first phase of development, which includes two apartment buildings, is also slated to begin by summer.