June 8, 2009
For release at your earliest convenience
For further information, please contact Stephen Mountain, Mendham Township Administrator at (973) 543-4555
Mendham Township Completes Successful Bond Sale With Help from AAA Bond Rating
MENDHAM TOWNSHIP, NJ (June 8, 2009) – On Thursday, June 5, the Township of Mendham conducted a competitive bond sale on a $10,000,000 bond issue. PNC Capital Markets was the lowest successful bidder with a 3.39 percent interest rate. Effective for 15 years starting June 18, 2009, the 10,000,000 general improvement bond issue will replace previous temporary financing and provide new financing on projects which were authorized from 2005 to 2008. These projects included road resurfacing, acquisition of public works equipment, land acquisitions through the open space preservation program and the new firehouse project. The bond proceeds will be used to retire existing temporary notes which are outstanding for these projects.
The bond sale was positively impacted by the AAA credit rating assigned by Standard & Poors Financial Services Company on May 27, 2009. The AAA rating is an upgrade from the Township’s previous rating of Aa1 from Moody’s Investor Service. Standard and Poor’s Senior Credit Analyst, Richard J. Marino in issuing his rating report stated that “the Township’s affluent residential tax base, access to broad economic and employment centers, and strong financial operations and management” were all factors in the positive review from his rating agency.
Mayor, Frank Cioppettini summed up the results of the sale stating, “We were concerned about the timing of the sale given the recent instability in the credit market, however, the results could not have been better for the Township and its taxpayers. The AAA rating from Standard and Poors was no doubt a major factor in the successful sale. This is a tremendous achievement for the Township” Stephen Mountain, Township Administrator indicated that the results of the bond sale will have a stabilizing effect on taxes. It is expected that the debt service on the bonds, together with other financing plans for future projects, will not exceed the amount currently provided for such costs in the municipal budget. “Our AAA bond rating had a tremendous impact on the rate we were able to attract. The Township rating was based upon our strong financial position and the overall stability of the community. Township residents should be truly pleased with the positive effect this bond sale will have on future budgets. Township Auditor, Kathryn Mantell of Nisivoccia & Company, LLP added that this was one of the lowest interest rates obtained on any recent sale in New Jersey. She added, “The results of this sale surpassed our expectations. We knew the market had been volatile in the past year, but the Township with its strong credit rating was able to overcome this volatility. The results should allow the Township to maintain its level debt plan, and stabilize what will be difficult budget processes in the coming years.
For further information about the bond sale and credit rating, please contact Mendham Township Administrator, Stephen Mountain at 543-4555.