Candidate Statement: Morris County’s AAA Bond Rating isn’t as secure as you think
Standard and Poors issue a report on September 23rd confirming Morris County’s AAA bond rating. The report cited a balanced budget in 2015 is one of the reasons why the county deserves the rating. However, it includes a caveat that the county had balanced operating results in 2015 only after an accounting adjustment for one-time litigation expenses. Those expenses include a $7 Million legal settlement associated with the mis-management of a county solar project. In order to fund the $7 Million, the county had to draw down reserves.
2016 is a different story for Morris County. The budget is increasing over 2%. The county is scaling down road resurfacing projects on county roads. Standard and Poors said that “if the county were to significantly and unexpectedly draw down reserves due to weak budgetary performance, we could lower the rating.”
There is a looming crisis on the horizon which is the rising cost of healthcare for county employees. In the public freeholder meeting on September 14th, county administrator John Bonanni commented that the cost of healthcare is expected to rise “double digits” for the next few years. The county spends about $40 Million per year on insurance, almost 15% of the budget. If this were to increase by double digits, that would create a serious hole in the budget.
Standard and Poors mentioned that Morris County has the ability to “significantly increase property tax base growth” which contributed to the stable rating. They pointed out that the county raised the tax levy by $7.5 Million in 2016.
The conclusion is that the county will maintain it’s AAA rating for now, but there are serious concerns for the next few years. If the county has to raise taxes to cover mis-managed projects, replenish reserves for legal fees, cut back on key infrastructure projects, and cover increasing healthcare costs, the outlook isn’t as secure as it appears.
The full report can be downloaded from the county website: http://morriscountynj.gov/wp-content/uploads/2015/04/Standard-Poors.pdf
If you comprehend this analysis, then you see that the Republican Freeholder board has mis-managed the budget in recent years and county taxpayers are footing the bill. This election year you have the ability to elect a new team of fiscally responsible Democrats to straighten things out. Horn, Clyde, and Von Achen have the skills and experience needed to mitigate the risks mentioned above and reduce the county budget. They will save you money in the form of property tax relief. Make an informed decision this election season.
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