Freehold Township receives AAA bond rating from Moody’s

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FREEHOLD TOWNSHIP – The highest possible rating for bond credit has been obtained by Freehold Township.

Municipal officials announced that Freehold Township was assigned a bond rating of AAA from the bond rating agency Moody’s, which indicates the township’s bonds are the safest investments and of the highest quality.

Moody’s also designated Freehold Township with a  stable outlook for its bonds, which denotes that the AAA rating is unlikely to change. Few municipalities hold the AAA bond rating, according to township officials.

“Typically, an AAA bond rating results in more bidders and an aggressive bidding process, which ultimately results in competitive pricing of bonds,” said Dara Melchionni, vice president of Acacia Financial, which is Freehold Township’s financial adviser.

According to municipal officials, Freehold Township sold $11.2 million in general obligation bonds and utility bonds on Oct. 22, which resulted in a low 12-year borrowing rate of 1.93%. Officials said the low borrowing rate is indicative of the increased number of bidders on the offering.

“On average, we pay off as much principal as we secure in new issues, which helps us plan appropriately for our needs and ensure that we maintain a solid balance sheet with respect to debt,” said Township Committeeman Anthony Ammiano, who chairs the Finance Committee.

The report from Moody’s attributed Freehold Township’s operating results largely to conservative budgeting and tight management controls, according to municipal officials.

The bond rating agency cited “unusually strong” budgetary management and planning, a strong reserve position and liquidity, and a healthy resident wealth and income in its tax base in its decision to award the highest possible rating.

Municipal officials said the stability is notable because the municipality’s reliance on property taxes is lower than usual, amounting to 54.9% of current revenues.

“We are proud of our AAA rating as it reflects the financial acumen with which Freehold Township is run on a daily and long-term basis,” Mayor Barbara McMorrow said. “Credit should be given to our chief financial officer, Catherine Campbell, and to our administrator, Peter Valesi, for the financial guidance they provide to the governing body. This recognition is truly a reflection of a team effort which benefits all residents.”

“The governing body has always taken the long-term approach to problem solving,” Township Committeeman David Salkin said. “Not ‘What’s good at this time?’ but ‘What is best for Freehold Township in the long run?’ Consistent, fiscally conservative planning is why we have achieved this top rating.”