Vernon keeps A-1 credit rating; multiple referendums a concern
By Ben Rubin
VERNON — The town maintained its high bond rating and enjoyed a "good day on the market" recently, selling $33.8 million in bonds and notes for capital improvement projects, Mayor Ellen L. Marmer said this week.
Town officials met with Moody's Financial Services analysts last week and, thanks to the town's secure financial outlook, kept the town's A-1 bond rating, town Finance Officer James M. Luddecke said.
Moody's did cite Vernon 's recurrent budget referendums as an area of concern, Marmer said, with the town facing four referendums each year for the past three years.
"It didn't look very well but we were able to get past that thankfully," Marmer said.
She said voters should take notice that all the referendums have a negative impact on the town's finances — in an overall economic picture and in direct costs.
In preparing the budget during this revaluation year, she said, officials plans to temper any budget increases and it is her "heart's desire" to finally pass the budget the first time around.
As a positive factor of the town's economic strength, tax collection remains "consistently strong," Luddecke said.
Additionally, Moody's mentioned that the leadership in Town Hall appears more consistent than normal, as Marmer was re-elected in a town not commonly known for mayoral re-elections.
"I don't know if anyone in town was happy, but Moody's was happy," she joked.
The town's fund balance remains slightly above average at about $7.6 million, which was seen as another plus, Luddecke said.
Interest rates were favorable for the bond sale thanks to the town's high rating, Luddecke said, with $12.8 million in 20-year bonds sold at 4.13 percent and $21 million of one-year notes sold at 3.54 percent.
The money will be used to fund capital improvements to schools, roads, and sewers, he said.
The largest bonding amount, $18.5 million, will go to renovating the town's high school, middle school, and all five elementary schools.
Luddecke said most of the work will involve bringing the schools up to code and reconfiguring classrooms. The money will also pay for an expansion of Rockville High School's gym and auditorium.
Including state reimbursement funds, the total amount spent at the schools will be $32 million.
Also, $14.2 million will be spent on repairs for 23 roads and three bridges and $1.5 million will go to sewer renovations, Luddecke said.
©Journal Inquirer 2007