Mayor James Altadonna recently announced that Moody's Investors Service has assigned an A1 rating to the Village of Massapequa Park's $3M Public Improvement Serial Bonds 2004. This reflects an upgrade from A2 on previous bond sales. The upgrade reflects a near doubling of the tax base since 2000 due to improved wealth levels and continued stability in the village's financial position. The A1 rating also factors the village's average debt burden.

Moody's expects the village will maintain a healthy financial position given conservative budgeting and a solid track record of ample reserves. At the end of fiscal 2003 the General Fund Balance equated 43.5 percent of General Fund revenues, reflecting the third year in which funds balance exceeded 40 percent of revenues. Projections for fiscal 2004, which ended May 31, indicate that reserves grew to 42 percent of General Fund revenues as a result of expenditure savings and mortgage tax revenues exceeding budget.

Evidencing financial flexibility, the village paid off its early retirement incentive in 2004 with funds originally allocated to pension costs (reflecting conservative budgeting of this line item). The fiscal 2005 General Fund budget includes a 5 percent property tax increase, expected to net $150,000. The increase is expected to offset the 7.2 percent (actual to budget) growth in expenditures, particularly increased costs in health insurance, pensions and salaries and wages. Conservative budgeting is projected to regenerate the $928,000 of appropriated fund balance.

Moody's anticipates that the village's average overall debt burden will decline given rapid amortization of principal (83.2 percent in 10 years) and no near term borrowing plans. The village expects to issue an additional $3 million of debt for road maintenance in approximately five years. However, given the rapid repayment of principal, the village will have reduced outstanding principal by more than the amount expected to be borrowed at that time.

Altadonna and the board of trustees were extremely pleased with the new rating and attributed it to common sense planning and conservative spending.