PRESS RELEASE FROM MOODY’S
Approximately $146M in debt affected
Moody’s Investors Service has placed the Town of Ramapo, NY’s general obligation A1 rating under review for downgrade, affecting approximately $146 million in outstanding debt.
SUMMARY RATING RATIONALE
The review for downgrade reflects uncertainty around federal fraud charges brought by the US Justice Department and the SEC against a former assistant Town Attorney and former Executive Director of the Ramapo Local Development Corporation and the town Supervisor. The charge includes the allegation that town officials misled investors regarding Ramapo’s financial position. The ramifications of these allegations with respect to the town’s recent financial reporting and current position are unknown, but could be significant if Ramapo’s as-reported situation has been materially over-stated. Recent audits have shown the town’s financial operations to be somewhat strained but gradually improving.
During the review period, Moody’s will attempt gather additional details on the charges, including those related to misrepresentation of the town’s financial operations, current financial position, and near-term liquidity.
Factors that could lead to a confirmation:
- Detailed information with full transparency on town’s current financial position
Factors that could lead to an downgrade/withdrawal of rating:
- Inability to obtain sufficient information on the town’s current financial position and/or past operations
- Receipt of additional information that indicates significant additional strain on financial operations