05/31/2019 | Press release | Distributed by Public on 05/31/2019 14:42
Posted Friday, May 31st, 2019
Rating Agencies Tout County's Strong Management and Conservative Fiscal Practices
Morris County has again received the top-ranked Triple A bond rating from the nation's two largest rating agencies, Moody's Investors Services, Inc., and Standard & Poor's, which once again lauded the county's stable management practices and fiscal policies.[Attachment]
The Triple A rating, which has been awarded to the county for a 44th straight year, benefits residents by allowing the county to take advantage of the best possible interest and financing rates, saving taxpayers hundreds of thousands of dollars annually.
'This is terrific news for our taxpayers because it gets the county the best rates on our general obligation bonds, which saves our residents substantial dollars,'' said Freeholder Heather Darling, who chairs the Freeholder Board's Budget Subcommittee. 'The Triple A rating reflects the value of the county's strategic planning and budgeting efforts, which have resulted in our long-term stability.''
Freeholder Heather Darling
S&P, in its analysis of the county, said its top rating for Morris County is based on several factors: the county's 'very strong economy, very strong management, strong budgetary performance, very strong budget flexibility, very strong liquidity, and strong institutional framework.''
'Extensive, well-integrated management policies and long-term planning have helped Morris County maintain its excellent credit quality, in our view,'' S&P said in its report.
Moody's once again touted the county's history of conservative budgeting, mixed with financially sound initiatives - such as the lease of the Morris View Healthcare Center, designed to improve the financial position of the county, as reasons for the top ranking.
It also praised the county's sound debt policy, its substantial and diverse tax base and highly dependable revenue streams.
'Management has a history and formal policy of budgeting conservatively and maintaining a healthy level of fund balance … and Moody's expects the county's economic tax base and finances to remain stable going forward,'' according to the latest Moody's report.
Morris County has had a Triple A rating since 1975. It was the first county government in New Jersey to obtain the prestigious rating and is only the 11th in the nation to achieve it.
The 2019 renewed Triple A ratings were made after a county finance team, comprised of Freeholders, the County Administrator, County Treasurer, and others made presentations to the ratings agencies last month in New York.
Freeholder Kathy DeFillippo
'It is very difficult to achieve a Triple A rating,'' said Freeholder Kathy DeFillippo, a member of the Freeholders' Budget Subcommittee. 'By giving us a Triple A, the rating agencies are signaling that our government and financial practices are excellent, which is a benefit to county taxpayers.''
'We are proud to continue this tradition of responsible government in Morris County, providing effective services and programs to county residents while being prudent about our spending and debt,'' said Freeholder Deborah Smith, also a member of the Budget Subcommittee.
Freeholder Deborah Smith
A Triple A bond rating, in effect, means the county has exceptional credit worthiness because the county can easily meet its financial commitments. The county can get the lowest interest rates when borrowing because a Triple A rated government entity is viewed in the financial world as having the smallest risk of defaulting on its debt.
That equates to lower borrowing costs, which allows for lower costs to finance capital projects.
Currently, the difference in interest that Morris County would pay on a 10-year Triple A bond is 35 basis points lower than a lower-ranked Single A bond and 10 basis points lower than a Double A bond.
The county's Triple A rating for an upcoming $32.5 million bond sale will cost county taxpayers about $640,000 less in interest than if the county had a Single A rating and $165,000 less than if the county had a Double A rating.