Michael D'Onofrio

mcdonofrio@lohud.com

Moody’s Investors Service has downgraded Ramapo’s bond rating, citing federal fraud charges against town Supervisor Christopher St. Lawrence that raised questions about the town's finances.

The town’s A1 general obligation debt was downgraded to A3 and its outlook has been revised to "developing," according to a Moody's report issued Wednesday.

The review that led to the downgrade, which affects $146 million in outstanding debt, began last month.

Moody’s laid the blame for the downgrade on the uncertainty surrounding the town’s finances stemming from the April 14 indictment of St. Lawrence on federal corruption charges, which alleged he and other town officials cooked the town’s books to cover up deficits and get bond money to build the town’s baseball stadium, now known as Palisades Credit Union Park.

St. Lawrence has pleaded not guilty to the charges, along with Aaron Troodler, the former executive director of the Ramapo Local Development Corp. They and two others — Town Attorney Michael Klein and Deputy Finance Director Nate Oberman — as well as the town also face related civil charges brought by the federal Securities and Exchange Commission.

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A poorer rating can lead to a higher interest rate when bonds are issued and, in turn, higher costs for taxpayers.

“The downgrade to A3 reflects the degree of increased risk stemming from the charges brought by the U.S. Justice Department and the SEC, which have resulted in near-term disruption in management and a likely delay in financial reporting and disclosure,” Moody’s wrote in announcing the downgrade.

The result of federal charges could also reveal that Rampo's finances are much different than what was previously reported, the report said.

"The developing outlook reflects uncertainty around the eventual outcome of the federal charges, including the possibility that the town's financial position could be materially different than what was presented in previous audited financial statements," Moody's said

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Moody’s noted in the report that Ramapo still has a sizable tax base with “above-average wealth,” and remains “solidly investment grade, with fundamental operations unaffected.”

The reported said Ramapo's financial position has been "pressured, but has been slowly improving based on updated information from the town."

"We believe the downside of any financial adjustments would be limited based on the specific allegations in the charges, although in combination with other events could result in additional credit risk,” Moody’s reported.

Twitter: @mikedonofrio_