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Credit agencies reaffirm Kent County's stellar rating
For the 15th consecutive year, two major credit rating agencies in New York gave Kent County their highest financial grades for both long- and short-term borrowing.
Those current top-of-the-grade ratings, a pair of triple-A’s, came from Standard and Poor’s and Moody’s Investors Service.
In addition to the rating, S&P indicated it doesn’t expect to change the county’s grade within the next two years because of Kent’s track record of strong financial management, a moderate debt position and its ability to have ended each of the past four fiscal years, when tax revenue was down, with a budget surplus.
Moody’s said it expects the county will continue to adhere to its fiscally sound management practices, which have resulted in financial stability and allowed officials to maneuver successfully through some ongoing turbulent economic and budgetary challenges.
Moody’s also said that an experienced management team, conservative budgeting assumptions and an increasingly diversified regional economy, which is showing signs of stabilizing, were contributing factors in its grading decision.
“The Board of Commissioners and county administration work hard to ensure that Kent County remains fiscally responsible,” said Commission Chairman Dan Koorndyk, who added in a statement that he was pleased with the outcome but not surprised by it.
“We have made the decisions necessary to provide long-term benefits to the community we serve,” he added.
The biggest benefit from gaining and hanging onto the top credit rating is it will cost the county less to borrow, if it chooses to do so, which saves taxpayer dollars. “It is important for us to maintain a strong credit rating in order to save on interest rates when we borrow for projects. The higher the rating, the lower the interest rates that we pay,” said Daryl Delabbio, county administrator and controller.
Delabbio explained that the triple-A ratings save the county about $800,000 annually in borrowing costs for each project than if it held a double-A rating. “It is prudent and responsible for the county to look at long-term financial stability and sustainability,” he said.
Delabbio told the county’s Legislative Committee that a few years ago when economic conditions were bleaker, he thought he would drop the county’s lowest targeted bond rating from triple-A to double-A. But he said his staff asked him why he was thinking of doing that and he kept it at triple-A.
Delabbio also said one of the ratings agencies was very impressed with the county’s financial report. The agency said it doesn’t often get such complete reports from state governments, let alone local units like the county.
“It was the work of fiscal services, and especially (Budget Coordinator) Marvin VanNortwick, that put the report together,” said Delabbio.
Kent County Treasurer Ken Parrish and County Fiscal Services Director Stephen Duarte joined Koorndyk and Delabbio on their annual visit to New York a few weeks ago to make the county’s case before the agencies for the triple-A ratings.
The county finds itself in a selective category with the reaffirmed ratings, as Kent is one of only 58 counties in the nation that has earned the top credit ratings for long-term debt from two agencies. There are about 3,200 counties in the country, and the counties that have earned two top credit ratings are just 1.8 percent of all counties nationwide.