Rating services affirm county’s top bond rating
Each of the three major bond rating agencies recently affirmed Westchester County”™s triple-A rating after the county closed the books on its 2011 fiscal year July 18 with the release of its Comprehensive Annual Financial Report.
Standard & Poor”™s and Fitch Ratings affirmed the county”™s triple-A rating July 20, with both calling the county”™s fiscal outlook “stable.”
A day prior, Moody”™s Investors Service affirmed the county”™s triple-A rating, giving the county a “negative” outlook, which represented no change from its November evaluation of the county”™s fiscal status.
For each of the three agencies, triple-A is the highest bond rating.
“It”™s extremely positive news that we continue to have a triple-A rating,” said Ned McCormack, the county”™s communications director and spokesman for County Executive Rob Astorino.
Westchester is the only county in the state to receive triple-A ratings from all three agencies.
Moody”™s said the negative outlook “reflects the county”™s structural imbalance in prior years that has driven reserve declines, which may limit the county”™s financial flexibility and ability to respond to mid-year revenue or expenditure fluctuations.”
The county”™s general or reserve fund is in place to guard against or offset unforeseen or emergency expenses the county incurs over the course of the year.
The fund was at $137.6 million in 2011 after being as high as $188 million in 2006, McCormack said.
The county withdrew $8.5 million from the general fund in order to close the books on its 2011 fiscal year, which ended Dec. 31 2011.
“We recognize that keeping the reserve fund strong is critical to maintaining our triple-A ratings,” McCormack said. “We also realize that a lot of money has been taken out of the reserve fund over the last few years.”
McCormack said that the $8.5 million withdrawal was significantly less than county budget officials had expected to need in order to balance the 2011 budget.
Westchester County”™s general fund balance represents approximately 8.7 percent of annual expenditures, whereas the average for triple-A rated counties is roughly 12.7 percent, McCormack said.
“So we”™re below the median and that”™s where the concern is,” he said. “By making every effort to minimize the use of the reserve fund this year, we”™re hoping to build that back up again.”
McCormack noted that the county”™s sales tax revenue from the first half of 2012 is in line with projections for 3 percent annual growth.