Credit rating service Standard & Poor’s recently issued a AA-stable rating on the $1.3 million bond used to pay for the 2012 road improvement project in New Hyde Park, allowing the village to obtain a 1.84 percent interest rate on its newest loan, which will be paid back over 13-years.
“Which is unbelievably good,” deputy mayor Robert Lofaro said during a village board meeting on December 18 at the village hall. “We’re delighted that, I’d like to say it’s almost free money but we still have to pay 1.8 percent on that money but for 13 years, the net effect of 1.84 percent is incredible.”
The 2012 road construction project, which suffered delays due to Hurricane Sandy, was recently completed.
“There are a number of punch list items that we have the contractor working on but the asphalt top coats have been laid, the curbing is done, the sod has been planted, sidewalks and aprons have been completed so the 2012 road improvement project at this point has been substantially complete,” Lofaro said.
Standard & Poor’s also reaffirmed the other bonds that the village has outstanding with that same rating. The firm also reported the village’s financial picture is “strong and is expected to remain as such,” according to the deputy mayor with a “moderate” debt burden at 2.9 percent of market value, which is considered low. Carrying charges are low at 9 percent of expenditures in fiscal year 2012, despite what the firm said was “an extremely rapid principal amortization.”
New Hyde Park is set to retire 91 percent of its principal over the next 10 years.
“In this market, there are four downgrades to every one upgrade,” Lofaro said, “so the fact that we remain AA-stable is an outstanding reflection on the folks of the village, the clerk-treasurer and the superintendent as well as the village board and their diligence in managing the budgets.”
The actual funding of the bond took place on December 20. Lofaro estimated that the amount would “be immediately turned around and paid to the contractors” doing the roadwork.