Two agencies give Babylon Town favorable credit ratings
Ratings agencies Standard & Poor's and Moody's have assigned favorable credit ratings to Town of Babylon bonds, a sign of confidence in town finances.
Citing a healthy town economy, budget flexibility and an aggressive debt-retirement program, the two agencies last month affirmed strong ratings on the town's $137 million of general obligation debt.
The agencies issued ratings of AA+ and Aa2, respectively, for $37 million in public improvement bonds and bond anticipation notes used to roll over superstorm Sandy reconstruction debt and finance property purchases for the Wyandanch Rising project in that hamlet's downtown.
Those ratings could translate into sizable long-term savings for the town. They are also a vindication for Supervisor Rich Schaffer and other town board members after an audit from the New York State comptroller's office last year faulted their financial management, including overestimating revenue.
"We disagreed with what the state comptroller's office said, and I think the outside professionals have called it right," Schaffer said last week. "They've basically validated what we've always known . . . We're a good investment."
The favorable ratings, he said, were a result of "the board and our team working hard to keep costs down, being financially conscious and being able to deliver excellent services."
The rating of AA+ is the second-highest presented by Standard & Poor's while Aa2 is Moody's third-highest. Other Long Island municipalities, including the Town of Oyster Bay, have seen their ratings slide in recent months.
Standard & Poor's warned that the town's $28 million in property purchases for the Wyandanch Rising project could expose it to "real estate market volatility."
Schaffer countered that the sewer line recently installed there had significantly increased the value of property in the area.