MOODY'S ASSIGNS Aa3 RATING WITH STABLE OUTLOOK TO PASSAIC COUNTY IMPROVEMENT AUTHORITY'S (NJ) $11.2 MILLION GUARANTEED LOAN PROGRAM BONDS (RECOVERY ZONE BUILD AMERICA BONDS), SERIES 2010

Posted on: July 8, 2010, 12:48 pm

NEW YORK, Jul 8, 2010 -- Moody's Investors Service has assigned a Aa3 rating to Passaic County's (NJ) $11.2 million Guaranteed Loan Program Bonds, Series 2010. Concurrently, Moody's has affirmed the county's Aa3 General Obligation bond rating, affecting $475.2 million of debt previously issued or guaranteed by the county. The current issue is first secured by loan payments made by the Township of Little Falls (G.O. rated A1, $6 million), The Borough of Wanaque (G.O. rated A1, $4.3 million), and Passaic County (G.O. rated Aa3/stable outlook, $6.6 million), the Borrowers, but ultimately security is derived from a County Guaranty Ordinance under which the county has pledged its unlimited ad valorem taxing authority. The bonds are secured by the county's unlimited property tax pledge. The Aa3 rating reflects expected stabilization of the county's financial position, albeit at a relatively narrow level, resulting from management's successful implementation of a workforce reduction plan to offset revenue lost with the cancellation of the county's planned golf course sale in 2007. The rating also factors the county's sizable tax base that continues to expand despite the ongoing recession, and a moderate debt position. Proceeds of the bonds will provide financing for the construction of a justice complex (Little Falls Township), replacement of water mains and water connections (Wanaqua Borough), and various improvements (Passaic County)...

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