Moody’s Investors Service has upgraded the South Farmingdale Fire District’s general obligation bond rating from A1 to Aa3.
The action is a result of Moody’s new local government general obligation methodology and affects $3.6 million in debt.
The upgrade “reflects the district’s sizable tax base with high wealth levels, minimal debt burden, and stable financial position,” Moody’s officials said. It noted that property taxes, which account for 98.4 percent of revenue, are guaranteed by Oyster Bay Town.
The district’s challenges are that state law limits the amount of unassigned fund balance a fire district may carry over on an annual basis and the statewide 2 percent property tax levy cap.
Moody’s said the district’s sizable and predominantly residential $1.62 billion tax base is expected to stabilize after declining 18.7 percent since 2008 because of the weak housing market.
The district provides volunteer fire protection and emergency medical services to the unincorporated area of South Farmingdale, North Massapequa and the Village of Farmingdale.