First The Mill Rate goes Up And Now This ...... Moody's Threatens To Downgrade Greenwich's Tripple-A Credit Ratting Greenwich First Selectman Peter Tesei And The BET Finally Start To Put Long Over Do Financial Controls In Place Greenwich could be in danger of losing its AAA bond rating from Moody's, which recently put the town on a negative outlook list. Moody's, a member of the big three credit ratings agencies, put on notice Aug. 4 that their top borrowing status could be at risk. Greenwich has a negative outlook, which basically means there's a risk of downgrade over the next year or two. Greenwich been consistently rated triple-A in recent decades. If Greenwich was downgraded, the immediate impact would be higher interest costs. Bonding had been commonplace up until 1933, when the town, saddled with debt, decided to go in a new direction of pay-as-you-go. For decades, Greenwich never went to the bond market with the exception of sewer debt. Greenwich turned to short-term borrowing to augment tax revenues to pay for capital items in recent years, resorting to long-term bonds for sewer improvements and other projects in which the town will get a guaranteed return on its investment through fees. The town is currently carrying $129 million in debt, a total that excludes $17 million in potential borrowing for a new music instruction space and auditorium at Greenwich High School and $15.6 million in potential borrowing for other projects. The town of Greenwich have to make a decision on how much to borrow for GHS auditorium or other capital projects until January 2012, In an attempt to prevent a Moody's downgrade the Board of Estimate and Taxation recently imposed a $210 million cap on borrowing. The new policy also limits the amount of money the town can apply toward debt service and interest payments to 70 percent of the capital tax levy, the amount of tax revenue dedicated to infrastructure projects and equipment upgrades. The town is currently taxing property owners for $32 million for capital items. In an effort to prevent a Moody's downgrade, the town also adopted a policy that requires it to keep a cash reserve at the end of each fiscal year that is equivalent to 5 to 10 percent of anticipated operating expenses. Greenwich residents want to know how this could of happened to Greenwich and what happened to all of those the town reserves? While many in Town say the Republican administration has done a poor job of managing the towns finances over the last decade, there is plenty of blame to go around. Well part of the problem is politicians like Larry Simon who has his head in the sand. Clueless Larry Simon who Is the finance board's longest tenured member is running around Greenwich, sounding like an extremist TEA Party lunatic saying,"This is not newsworthy!!!!" Thank goodness Larry Simon and his partner in crime on the Billy Kelly are going to forgo running for re-election to the Board of Estimate and Taxation. It was just five months ago that Bill Kelly was publicly proclaiming,"The BET's in good hands. They'll be fine." Apparently, Kelly was unaware that Moody's was pouring over the towns books wondering what happened to all those cash reserves and where did all of this short term borrowing come from? As I said above ..... For decades, Greenwich never went to the bond markey with the exception of sewer debt. =================================================== Please send your comments, news tips and press releases to GreenwichRoundup@gmail.com |
No comments:
Post a Comment