Moody's Investors Service said it has downgraded to Aa3 from Aa2 the rating on Orange County, N.Y.'s $261 million outstanding general obligation debt.
Concurrently, Moody's assigned a Aa3 rating to Orange County's $28.7 million various purpose serial bonds, Series 2014. The outlook remains negative.
The county's debt is secured by a general obligation pledge as limited by the Property Tax Cap - Legislation (Chapter 97 (Part A) of the Laws of the State of New York, 2011.
Proceeds will fund a variety of capital projects including renovation and reconstruction of various county buildings ($8 million) and expansion of Orange County Community College facilities ($5.9 million).
The downgrade to Aa3 reflects an ongoing multiyear trend of operating deficits and declines in reserve levels, which is expected to continue in the near term. Factors supporting the Aa3 rating include a large tax base with above average wealth levels and average debt burden. The negative outlook reflects the expectation that operating deficits and reserve draws will continue in the near term.
The negative outlook reflects the expectation that operating deficits and reserve draws will continue in the near term and that the county will be challenged to achieve structural balance in the near term.
