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Town Bond Rating Downgraded; Questions Loom

Venditto says Oyster Bay is taking steps to address unfolding budget concerns.

A credit rating service's decision to downgrade the Town of Oyster Bay's bond rating could have both fiscal and political implications as the year progresses.

Newsday reported Wednesday that Standard & Poor's Rating Services had downgraded the town's bond rating to A from AA. In its report, Standard & Poor's cited the town's "failure to make the necessary budget adjustments to offset declining revenue" as its reasoning.

In simple terms, the decision could make borrowing money more expensive for the town. The lowered ratings (adjusted for both short-term and long-term bonds) make them less attractive to investors.

Newsday reported the town had an estimated general fund balance deficit of $655,000 last year and was planning to sell bonds to cover a $13 million shortfall this year.

Yet the town's 2012 budget contains no property tax increase over the previous year.

Supervisor told Newsday that Oyster Bay is addressing the looming fiscal problems, which he blamed on the ongoing recession. The town is proposing a retirement incentive program; a public hearing on the proposal is set for June 19. Venditto said the board has fought increasing the tax burden on Oyster Bay homeowners.

What's your take on the town's financial condition? Do you see higher taxes on the horizon? Cuts in services? Layoffs? Political chaos?

Take our poll and sound off in the comments.

George June 07, 2012 at 06:12 PM
So I guess this means no turf filed for Plainview..I wonder if he knew this was coming and went ahead and said they would build the field, knowing that he would have to cancel due to budget concerns
Joe Dowd (Editor) June 07, 2012 at 06:58 PM
While we intend to continue covering this, municipal governments have many options for staying afloat without significant hardships. Lots will depend on whether the town can get outside help and reduce its workforce through incentives. The turf field, in the scope of things, may not be in any danger at all.
Phil Healey June 07, 2012 at 09:19 PM
If you look at the entire situation, even the US gov't had thier bond rating dropped. The Town, in my opinion, has weathered the storm pretty well up to now. They installed many items such as turf fields, to keep a stable tax bases by making this a great desirable place to move into ( greater number of home sales = mortage taxes revenue) and preserve the assessed value of the community. The use of turf reduces the need for a staff full of Horticulturist to grow grass and provides a play area even in the lean times. The Town has a tremendous oppourtunity to raise revenue via user fees,( such as central meters in all muncipal parking lots) or perhaps as a shared pain, we will all have to kick in a little more to mainatin the quality that we have all grown to enjoy and even expect. Personally I prefer to raise revenue through creativity first.

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