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Saturday, November 22, 2014

Moody’s: Sandy could add to city’s financial strain
(Page 2 of 2)
Courtesy City of Long Beach
City Manager Jack Schnirman, far left, during a recent meeting with FEMA officials. Schnirman said that the city is looking for a full reimbursement for costs associated with Sandy.

Moody’s also said that the city could face potential revenue losses as a result of the storm; delayed property tax collections if homeowners defer payments — revenue that could be recouped through lien sales — and a decline in the city’s tax base, since many homes are uninhabitable. However, Moody’s said that it expects most home and business owners to rebuild, mitigating the long-term effect on the tax base. If the city’s tax base declines in the coming years, Moody’s said that Long Beach would likely set its tax rate “to ensure that property tax revenues are not significantly impacted.”

Moody’s commended the city’s new management team for taking control of its finances in January and “improving financial operations in an effort to maintain structural balance and improving liquidity.”

“While Hurricane Sandy increases the challenge to its near-term goals of financial stability, the city continues to actively manage its financial operations through the recovery from the storm,” Moody’s wrote. “Management has indicated that it has sufficient liquidity to maintain its operations and make its upcoming debt service payment in December.”

Moody’s said that it would monitor the city’s finances and the level of reimbursement from state and federal agencies, while also paying attention to the pace of recovery.

“We have been in touch with our financial advisers from day one and we have started working with FEMA,” Schnirman said. “We’re tracking our expense and recovery costs, and we were very fortunate to have a lot of resources from other levels of government deployed on our behalf to assist in the recovery, and we’ve been in touch with Moody’s as well.”

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