Dover Treasurer-Collector Discusses Town's 'Negative Outlook' From Moody's

With Dover having recently been given a 'Negative Outlook' from Moody's Investors Service, Dover Treasurer-Collector Jerry Lane talked about what the notice is and what it could mean for the town.

"The ‘Negative Outlook’ is effectively a notice that Moody’s is looking at a credit rating and if the rating changes it will be downwards," Lane said in an email.

Dover, along with several other towns in the state, will likely be reviewed by Moody's who will then decide if Dover will keep their rating the same or be downgraded.

"Moody’s will, over the next three months, review all of the communities given a 'Negative Outlook' and either confirm the current AAA rating or downgrade us. As part of the review they will be looking at what happens at the Federal level, how that will affect the Massachusetts economy and state budget; and ultimately how those issues interact with Dover’s specific circumstances," Lane said.

The reason for the 'Negative Outlook' is largely due in part to the recent downgrade of the sovereign rating of the United States from Standard and Poor's.

"What we have learned from available sources is that the primary reason for the ratings review is the situation at the Federal level. The analysis is that Massachusetts and Virginia will both be impacted more than other communities by reductions in U.S. government spending as a result of attempts to control the Federal deficit. This would both be in terms of direct Federal spending on programs in the state and lowered economic activity as spending cuts ripple through the regional economy," Lane said.

So what does this mean for Dover?

"The terms of Dover’s current bonds are set and would remain the same whatever happens to the rating during this process. A lower bond rating usually leads to a higher interest rate on borrowing. At this time I know of no immediate plans for the Town to issuing any bonds," said Lane.