Rockland County’s credit rating took another hit on Friday when Standard & Poor’s dropped it to BBB-minus from BBB-plus.
“We lowered the rating on the county’s GO debt due to the continued erosion of its financial position and once strong reserves,” said analyst Danielle Leonardis.
“In addition, projections show a negative balance in the county’s total and unreserved general fund balance for fiscal years 2011 and 2012.”
The rating is now on par with
S&P’s downgrade comes after the state legislature ended its session without approving the county’s request to issue deficit reduction bonds, which the credit rating agency views as a negative rating factor.
Rockland County hoped to isse up to $80 million of bonds to help plug its deficit. The county’s finance commissioner, Stephen DeGroat,
Standard & Poor’s said it also factored in the rating the county’s diverse, suburban economic base, very strong wealth and income indicators, and a low overall debt burden.
While the county legislature has taken a series of steps to address its financial position, uncertainty remains about bridging a potential $40 million budget imbalance for fiscal 2012, analysts said.
The agency also assigned a negative outlook, which reflects its view of the recent budget challenges, as well as the county’s modest cost-cutting measures to bridge these imbalances.
“If management is not willing or able to implement and adhere to a plan to restore structural balance and reserves, Standard & Poor’s could consider another downgrade,” the report said.