Plainsboro has become one of the state’s top municipalities when it comes to managing its finances: the township has been given an AAA rating by Standard & Poor’s — the highest classification possible.
The township joins only 10 other municipalities statewide, including West Windsor, that has earned the top credit rating.
Standard & Poor’s, the world’s premier provider of investment research and credit ratings, also considers the township’s financial management practices “‘strong’ under its Financial Management Assessment, indicating that practices are comprehensive and sustainable,” stated a press release from the township.
The Standard & Poor’s report also identified Plainsboro’s financial outlook as stable, noting that “the outlook reflects our expectation that Plainsboro will continue to maintain very strong general fund reserves and that future debt issuances will be limited.”
“The outlook also reflects the township’s healthy economic base and commercial development,” the report stated.
Mayor Peter Cantu said he was pleased with the recognition and said that the township “has adhered to practices and policies that have ensured the careful management of the township’s finances for many years.”
Township Administrator Robert Sheehan said that the new rating will have “the immediate benefit of ensuring the best possible interest rate for the upcoming bond sale. This will likely provide a significant savings to our taxpayers.”
Sheehan said the township is selling a $24 million bond that covers projects the township has done in recent years. The bond carries a 15-year payback. “When these projects come up, we use short-term bonds, called bond anticipation notes, and they are usually for a year,” explained Sheehan. “When we accumulate enough debt or bond needs from various projects, we then go out and sell longer term bonds.”
Those bonds are expected to have a lower interest rate because of the new AAA rating.
“Plainsboro has a very low debt amount,” added Sheehan. “We’ve been able to maintain it at a very low level, even though we’ve been doing some very significant projects.”
Cantu said that Plainsboro has always felt “we were a Triple A community when it came to financial management.” He said township officials recently made a long presentation to Standard & Poor’s, and “they came away agreeing with us that, frankly, by any measure, Plainsboro Township is well-managed.”
The AAA designation does two things: it helps the township achieve lower rates on debt issuances, but it also recognizes the township’s practices over the years, said Cantu.
“It’s an affirmation of the policies we pursued with regard to financial management,” he said.
