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Ocean County Scores Big On Credit Rating
By Bill McLaughlin
The Ocean County Board of Chosen Freeholders completed a bond sale for $41.8 million on July 31, Freeholder James Bartlett announced last Wednesday.
Bartlett said the funds can only be used for long-term capital improvements and are earmarked for the following: $13 million toward the addition to the Southern Ocean County recycling center and the government complex expansion in Stafford, $6.7 million for parks projects including the Jakes Branch County Park in Beachwood and rehabilitation of the Tip Seaman Park in Tuckerton, $8.6 million for infrastructure and road improvement projects and $4.75 million for preliminary work on the proposed $50 million county jail expansion project.
Bonding was conducted during a 15-min- ute online auction, during which 17 bids were offered by seven competing firms. Bartlett said the winning bid was made by LaSalle Financial Services Inc., Chicago, at an interest rate of 4.29 percent for the
20-year term of the issue.
Bartlett said the county's high bond rating - one tick below the top level - helped in
getting the transaction completed.
"Let's face it," Bartlett said. "People lend money based on the expectation of being repaid. We'll pay off a substantial portion of the principal every year, $1.4 (million) to $2.8 million at the end."
Bartlett said the county has a track record of being fiscally conservative and for paying cash for most capital projects. As a rule, Ocean County has maintained solid surpluses in the past two decades.
Current county government spending increased by 5.7 percent over 2006, but since the population continues to increase, revenue growth out-paces the rising expenditures. The current county budget of $344 million includes a fund balance of $55 million, roughly 16 percent of current spending.
"Critics of county government have chastised this board for our surplus and our pay-as-you-go policy," Bartlett said in a prepared statement. "However, according to the rating houses, these are the two key reasons the county fares so well financially."
Bartlett quoted Fitch's rating service report as saying Ocean County was consistently strong in paying off debt rapidly and Moody's Investor Services said the county was in a solid financial position.
"This is a good rate in a time of rising rates," Bartlett said, "and it's because of our good bond ratings: Fitch rates us AA+ and Moody's AA1 - one notch below triple A ratings."
The board has unanimously backed the fiscal path Bartlett has led them down as the financial guru. His budgets are Spartan by comparison to other governmental agencies on the state level as well as local and federal.
Ocean has the highest bond rating of any South Jersey county, Bartlett said.
"This is a reflection of our ability to live within our means and don't bond too much," said Freeholder Joseph Vicari.
Freeholder Director John Kelly said that 72 per cent of all county long-term debt will be paid off in the next 10 years.
In a related matter, Bartlett also announced that the county Natural Lands Trust would partner with the federal government in buying up a proposed land development north of the naval air engineering station in Manchester, each side putting up $650,000.
He expressed surprise when looking at a map of the site to discover most of the land in question is actually in Jackson.
"I never knew that," Bartlett shook his head. "I thought the base was in Manchester."
Actually, most of the developed land, including what soon will be a three-runway air strip, is in Manchester.
A federal grant from the Department of Defense will help the two sides work together in providing a buffer zone. Buying land in such close proximity to airport runways is good business anyway. The two negatives involved in manned flight are noise and accidents, neither of which is good for a nearby residential neighborhood.
"There are two interests here: It would provide a buffer for the (Naval Air Engineering Station Lakehurst) and would help protect the Toms River watershed," Bartlett said.
By providing a buffer between the base and surrounding civilian development, Kelly said, local communities can ensure keeping the federal facility viable.
"Two times now we were able to save the base (from closure)," Kelly said. "That's 4,400 high-paying jobs plus all the ancillary jobs from those working at the base. Encroachment will close the base. Creating a buffer is the most important thing we can do."
The freeholder board announced last month that it planned to buy up farms on the edge of the sprawling federal military complex that includes Fort Dix and Naval Station Lakehurst.
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