East Hampton Town’s bond rating has been upgraded by Moody’s Investors Service to the third-highest rating offered by the agency.
The agency, which is based in Manhattan, upgraded the town’s rating from Aa3 to Aa2, according to a press release sent out by East Hampton Town Supervisor Larry Cantwell’s office on Tuesday afternoon. In its report, Moody’s stated that the increase “reflects the town’s stable financial position, which has improved over the last several years as a result of deficit financing, improved budgeting and strengthened financial management practices.”
The increase comes in advance of the sale of $4 million in serial bonds and $12.1 million in bond anticipation notes. Town Budget Officer Len Bernard said the improved rating should generate more market interest in the bonds and bond anticipation notes being sold later this month, and should result in lower interest costs. The town could see up to $100,000 in interest savings over the life of the serial bonds being offered, he added, as a result of the improved financial rating.
Moody’s stated that East Hampton is in a stable financial position and will likely remain that way, due to its conservative budgeting and strong financial management practices with limited future borrowing planned.
The challenges the town has, according to Moody’s, is making sure financial operations are balanced amid rising spending pressures and limited flexibility in revenue-raising. It notes that the town has above-average debt service expenditures as a percent of budgetary spending.
“[The report] reflects a recognition of past achievements and the prospect of continued strong performance under new town leadership,” Mr. Bernard said in the press release on Tuesday afternoon.