Fitch gives Suffolk ratings a negative outlook
Suffolk County Executive Steve Levy has plenty to say about the new caution on county bonds from Fitch Ratings. With Levy are, from left, Islip Supervisor Phil Nolan and Brookhaven Supervisor Mark Lesko. (Nov. 28, 2011) Credit: Newsday / John Paraskevas
A second Wall Street agency has given Suffolk County's credit rating a negative outlook, citing diminishing reserve funds and "aggressive" estimates of sales tax revenue.
A negative outlook warns investors of a possible credit downgrade if fiscal conditions continue to deteriorate.
"The county's overall financial flexibility and cushion have weakened, reflected in a significantly lower fund balance and reduction in the tax stabilization reserve fund," Fitch said Tuesday.
The agency also expressed concern that Suffolk's "aggressive" estimate of sale tax revenue "remains vulnerable to shortfalls," noting that the county has budgeted a $46.3 million increase in sales tax revenue next year.
County Executive Steve Levy, a Republican, blamed Fitch's negative outlook on the county legislature's changes to his proposed $2.7 billion budget. Lawmakers balked at Levy's plans to close or sell the county nursing home and to lay off 710 employees if unions did not make concessions.
"This is exactly what we warned against," Levy said. "The negative outlook comes after legislators ducked the tough decisions."
But Republican County Comptroller Joseph Sawicki argued that Levy, "can't blame the legislature for this, since he literally micromanaged the county himself for the last eight years."
'I've never seen fire sitting on the water' Three Newsday photographers talk to NewsdayTV's Macy Egeland about covering the tragic crash of TWA Flight 800 in 1996.
'I've never seen fire sitting on the water' Three Newsday photographers talk to NewsdayTV's Macy Egeland about covering the tragic crash of TWA Flight 800 in 1996.
