By Amy Batista, Special Writer
CRANBURY — The Township Committee found out last month it received another AAA Standard & Poor’s bond rating.
The township has maintained the highest financial rating, used to determine the market value of the town’s debt and the interest it would be charged, since 2009.”The credit rating is a report card on the fiscal responsibility that Cranbury’s Township Committee is responsible for,” said Mayor David Cook. “The higher the rating the more credibility you have when funding an annual budget and the lower the interest rate you will have to pay. It’s like your credit score that you hear so much about.”
According to officials, Cranbury is one of the few municipalities that are AAA rated.
”There are over 500 municipalities in the State of New Jersey and currently 20 municipalities are AAA rated plus four counties,” said Denise Marabello, CFO and Finance Director.
According to Ms. Marabello, they received the AAA bond rating because of, strong market value per capita, strong financial performance with a healthy surplus reserve, higher than national average median household effective buying income, and access to New Jersey and NewYork employment centers
Councilmen Jay Taylor noted the importance of receiving such a high rating on the bond and what this means for residents in Cranbury.
”When we embark on large capital projects we need to issue a bond or note,” said Mr.Taylor. “The interest rate we pay is dependent on the credit rating we have which operates much the same way as an individual’s credit score. An “AAA” bond rating is akin to having the highest credit score possible. So when we have to issue a bond or note the interest rate we pay is lower than a town with a lower bond rating.”
Ms. Marabello also described the lower interest rates and what it means to the financial health of the community.
”Lower interest rates (anywhere from .25 to .5 percent lower) when going to market for a bond anticipation note or bond,” Ms. Marabello said.
Mayor Cook said the importance of the bond has on measuring the town’s vitality and helping to keep it sustainable as well as giving the him “confidence” that the township is being “fiscally responsible” as well.
”The credit rating is just one measurement of the health and vitality of our town. There has been a lot of pain associated with the high credit rating as well,” Mayor Cook said. “Reducing the operating budget by $500,000 since 2009 was a result of uncomfortable cuts in popular programs. These cuts had to be made to keep Cranbury’s fiscal health sustainable.”
”Cost cutting in conjunction with sound tax policy allows us to compensate for the loss in property tax ratables as well. It is critical to have a sound credit rating combined with strong fiscal policy to keep Cranbury as the town we know it today and the town we expect it to be,” Mayor Cook said. “The rating gives the confidence that myself, as mayor and the township Committee, are being fiscally responsible.”
Mr. Taylor said the changes in the bond rating could impact a change could have financially on the town’s budget and tax rate.
”It is extremely important that we held onto the AAA rating. Not many towns in New Jersey have this rating so we’re in very select company especially given the current economic climate. The only way to achieve and maintain the rating is by adhering to sound financial principles and ensure we have a complete understanding on how each element of the budget is related,” Mr. Taylor said. “A decrease in surplus could cost us the rating as quickly as a large jump in the tax rate. So you need to have a long term plan for how much surplus you use, what capital projects you plan and how stable we can maintain the tax rate.”
According to Mr. Taylor, they have a major project looming on the horizon with the repair to the Brainerd Lake Dam.
Without the AAA bond rating, the cost to borrow the money would be higher and place a heavier burden on the residents and businesses.

