New Rochelle, New York, had its general-obligation debt rating lowered one level to Aa3, the fourth-highest investment grade, by Moody’s Investors Service after declining tax revenue drained reserves.
The downgrade affects $108 million in debt. The Westchester County city of about 74,000 people ended fiscal 2009 with a $5.3 million deficit after its reserves fell by almost half to $7.2 million from 2007, Moody’s said in a report today.
New Rochelle, 16 miles (26 kilometers) northeast of New York City and popular with commuters, will continue to benefit from its “sizable $11.7 billion tax base with above-average wealth levels,” the analysts said. The city hopes to raise money through increasing parking-permit fees and a long-term land-sale agreement, and has reduced staff through a hiring freeze and attrition, the firm said.
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