Village officials voted at a special meeting on April 15 to issue roughly $3 million in bond anticipation notes to pay for capital expenses already committed to by the village, including final payments for equipment purchases and infrastructure upgrades, as well as funding for annual street replacement in the village.
Valley Stream opted to rely on notes, or short-term borrowing, instead of bonding for the expenses — loans that carry a longer shelf life — because of the proximity in time to the village’s bond rating downgrade in February by Moody’s Investor Services to Ba1.
Because anticipation notes do not trigger a bond-rating review, according to Village Treasurer Michael Fox, the village decided to use the method of borrowing because another review so close after Moody’s last report would not likely result in an upgrade.
“We don’t see any point in going through that process now,” Fox said.
Additionally, he said he did not expect the notes to be affected by the rating downgrade, although he did anticipate some interest rate increases as the Federal Reserve’s confidence in the economy grows.
The borrowing comes after village officials had vowed not to issue any new bonds until the village’s credit rating improved. Mayor Ed Fare said that while he was sticking to his promise, the notes had already been committed to before the latest downgrade.
“These are bonds we have in the pipeline,” he said. “Within five years, our bond rating will probably be
Among the notes issued, they include up to $575,000 to finalize payments for the replacement of underground fuel storage tanks and fuel system upgrades at the village’s Arlington Yard facility. The replacement and system upgrades were necessary to keep the infrastructure compliant with state Department of Environmental Conservation guidelines. Construction of the project was completed in October, according to previous Herald reporting.
The village also plans to borrow up to $840,000 to pay for the purchase of three Parks Department trucks, a transit van and chief’s vehicle for the Fire Department and a fleet maintenance truck, all of which went through competitive bidding processes, Fox said.
Also, as part of routine village street replacement, Valley Stream is borrowing up to $1 million to replace the streets most in need of repaving.
Earmarked for information technology upgrades, specifically for operating system updates on computers throughout the village, is a note for $35,000. Because of the scale of the upgrades, Fox said, the village opted to capitalize the expense instead of dedicating a line item in the proposed 2019–2020 budget.
Finally, the village board voted to borrow $600,000 for Fire Department equipment, including the replacement breathing of mask apparatuses, department radios to comply with newer Federal Communications Commission guidelines and air compressors at the department’s firehouses to replace compressors that Fox said had become increasingly expensive to maintain.
Melissa Koenig contributed to this story.