NEW YORK - Moody's Investors Service said it has upgraded the town of Harrison, N.J.'s long-term general obligation rating to Ba2 from Ba3, affecting $23.9 million of outstanding parity debt.
The outlook is stable.
This action concludes Moody's review for upgrade of the town's GO rating, which began on March 16.
The upgrade to Ba2 from Ba3 reflects several positive developments for the town, including demonstrated market access for its 2012 tax anticipation note (TAN), which provides cash flow for its operations, including for debt service.
The town sold the TAN on April 27, 2012 through a negotiated sale. The town also receives additional, although limited, financial support from the state of New Jersey (GO rated Aa3) and has been admitted into the New Jersey Qualified Bond Program.
Incorporated into the Ba2 rating and stable outlook is the continued near-term uncertainty regarding $1.2 million of anticipated property tax payment, net of a reserve for delinquent taxes, from the town's largest tax payer, Red Bull Arena. Although a recent court ruling requires the Red Bull Arena to pay current and delinquent property taxes, the arena has not made payment.
The stable outlook also reflects structural improvements to financial operations evidenced by a fiscal 2012 budget that balances sharply escalated debt service with higher recurring property tax revenues and lower expenditures.
