Riverhead Town got a bit of good news this week after finally catching up with its state-mandated financial audits that had been delayed for years.
Standard & Poor’s credit rating industry has given the town high grades, Supervisor Sean Walter announced Friday.
The town didn’t receive a credit upgrade, but did maintain its high mark of a AA2-, which means the town just has to pay a relatively nominal premium when borrowing money to be insured up to the even higher AAA3 rating.
And that means lower interest rates, Mr. Walter explained.
“In these days of credit downgrades for governments across the nation and the downgrading of the credit rating of even the United States itself, I am happy to say that Riverhead maintains one of the best credit ratings any government can have,” Mr. Walter said in a prepared statement.
The town can now finance the more than $17 million in debt from capital projects that was on the books when he took office, as well as an additional $6 million or so without having to issue bond anticipation notes that carry a much higher interest, the supervisor said.
“I am pleased that in these times of financial chaos, we can at least assure the taxpayers that in our little town their money is well cared for and that even Wall Street recognizes our house is in good financial order,” he said in a press release issued Friday, adding that, “Riverhead is steadily walking the path of financial stability.”
Due to a multitude of factors, including a change in town finance chiefs and even outside auditors, the 2009 audit was just recently completed. The 2008 audit didn’t wrap until March of this year, and the 2007 audit wasn’t done until December 2009.
After reading the initial news Friday of the bond rating, Mr. Walter’s Democratic challenger for supervisor, former supervisor Phil Cardinale, pointed to the 2009 audit’s findings that the town had $14.7 million in reserves at the end of 2009 — the last year he was in office.
Mr. Walter, a Republican, took over the town in January 2010, and was immediately critical of his predecessor’s handling of the town’s finances.
But Mr. Cardinale defended his record this week.
“In 2010, he was just beating me that we had ruined the town and that we were all going broke,” Mr. Cardinale said. “But if you look at page 76 [of the 2009 audit], the town had a reserve of almost $15 million. I don’t doubt that the town has maintained its credit rating, because I know when I left that it was in good shape.
“And fairness to him, I think he’s generally tried to not screw it up,” Mr. Cardinale added, though he was critical of Mr. Walter’s decision to raise taxes in 2011 while laying off town employees. “It’s true that you bring down your reserves by utilizing it, but it’s also true that that’s not your money. It’s the taxpayers’ money.”