Contact: Colleen Roche (212) 788-2958 or Deirdra L. Picou (212) 788-2971
Mayor Giuliani welcomes S&P's comments on the IFA and the city's debt limit. S&P stated that the approaching debt limit "stems from the complicated and non-intuitive formula the State uses to estimate New York real estate values under their full-value calculation."
The Administration has proposed legislation in Albany to create the IFA to maintain the city's existing ten-year capital program. "Maintaining the capital improvement program of the city is a high priority. The inability to fund infrastructure improvements would have a detrimental impact on the safety of our aging infrastructure and the viability of our city's economy," said Mayor Giuliani. S&P stated that "any sudden halt to the New York City's capital program must be prevented to make sure essential infrastructure is still open for business."
S&P indicated that "although it is unlikely that the city's G.O. rating would be changed solely on the basis of the city reaching its G.O. debt limit, if the city reached this limit without any ability to bond through other means, it could have negative credit implications." According to the Mayor the purpose of the IFA is not to expand the city's outstanding indebtedness or to increase the city's debt service burden. Instead, the city is creating a new funding vehicle that will provide the city with the flexibility to continue moving forward with strengthening the city's economy and competitiveness.
Mayor Giuliani urged the state legislature to consider the IFA legislation at its earliest convenience to prevent jeopardizing the city's capital program.