NEW YORK - Moody's Investors Service has confirmed the Baa3 rating on Rockland County, N.Y.'s $240 million in rated general obligation debt and revised the outlook to negative; the rating is no longer on review.
The bonds are 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).
The confirmation of the Baa3 rating reflects management's proactive approach to closing the current year budget gap caused by the county's failure to get state approval for various revenue enhancements.
The Baa3 rating also factors the county's accumulated gneral fnd balance deficit, which is expected to grow to $95 million by the close of the current fiscal year, and declining liquidity, evidenced by the need to issue an additional cash flow note this month.
The county is also awaiting state approval to issue $80 million in deficit reduction bonds to be repaid over ten years.
Management has also failed to either sell or make financial improvements to the county-owned nursing home, which depends on operating support from the county.
The negative outlook reflects ongoing challenges to the implement a plan to close the significant current year $18 million budget gap, continued pressures from the county run nursing home, and ongoing liquidity concerns, which county officials hope to mitigate with the issuance of deficit reduction bonds sometime next year.
The county is likely to incur significantly higher interest costs for the issuance of the cash flow notes they expect to issue this month.