Issued by: Hempstead Town Council
Town of Hempstead Councilmembers are proud to announce that the Town’s recent credit rating upgrade has resulted in significant interest cost savings. In its recent press release, Standard & Poor’s (the Town’s credit rating agency) has recognized both the Town’s “strong budgetary performance and increased budgetary flexibility.”
“We knew the recent bond rating upgrade was good news for our taxpayers and I am so happy to see the savings come to fruition so quickly,” said Councilwoman Erin King Sweeney, Hempstead Town’s Majority Leader.
In mid-June of this year, primarily based on the Town’s 2016 audited financials, Standard and Poor’s (S&P) Global Ratings Agency upgraded Hempstead Town’s bond rating from A+ to AA- with a positive outlook.
“We had to make many difficult budget decisions over the last three years but seeing the way that these decisions are now leading to cost-savings for our residents is a clear indication that we did the right thing,” said Senior Councilwoman Dorothy Goosby.
“By working collaboratively, the Town of Hempstead is making positive financial strides and saving taxpayers money,” said Town of Hempstead Supervisor Laura Gillen. “We are moving in the right direction and will continue working hard to make sure our Town is on secure financial footing.”
The benchmark for interest costs of municipal borrowers is the Ten-Year (10) Federal Treasury Rate. “In its 2017 borrowing, the Town incurred an aggregate interest rate of approximately 2.84% while the Treasury Rate in effect was approximately 2.34%. Accordingly, the Town’s interest rate was greater than the Treasury Rate by half a percent. Conversly, in its 2018 borrowing, the Town’s interest rate was lower than the current Treasury Rate by half a percent,” stated Town Comptroller Kevin R. Conroy.
Further, this borrowing included refinancing of both 2007 and 2008 Series bonds resulting in a total budgetary savings of approximately $2.8 million dollars.
“This borrowing confirms the current economic status and financial viability of the Town of Hempstead and, as well, the desirability of investing in our Town,” concluded Councilwoman King Sweeney.