Erie County bond rating gets big boost from S&P
By JAMES FINK
[email protected] | 716-541-1611
Wall Street rating agency Standard and Poor's Financial Services LLC raised Erie County's bond rating from BBB+ to A- for general obligation bonds that cover myriad projects.
At the same time, S&P affirmed Erie County's fiscal outlook as "stable."
That's a far cry from the "red and green budget" days of six years ago that led to the county's finances being overseen by a state-appointed fiscal stability (control) board.
"I am glad to see that S&P has again recognized the financial progress that Erie County continues to make," said Erie County Executive-elect Mark Poloncarz, currently the county comptroller.
Standard & Poor's took note of several factors, including the county's strong unreserved general fund balance that tops $27.3 million; approval of a four-year fiscal plan that runs through 2015; and a stable economic base coupled with below-average unemployment rates.
There are some fiscal red flags, however, according to Standard & Poor's. They include Erie County's reliance on the unpredictable sales tax revenue as one of its primary sources of income and new state limitations on property tax growth - the 2 percent property tax cap Gov. Andrew Cuomo instituted this summer. It is also concerned about rising Medicaid and pension costs that cloud the county's fiscal picture.
"While S&P was encouraged by the projected budget surplus this year, they appropriately point out that we still likely will see a net reduction of fund balance for the year," Poloncarz said.