Moody’s withdraws its credit rating for Mount VernonPosted: Updated:
The political dysfunction at Mount Vernon City Hall is now creating a major financial headache for the city.
The Moody's credit rating agency took the dramatic step to withdraw its credit rating for the city, blaming the city's lack of transparency with its financial records as the cause. It's a move that City Council President Andre Wallace calls devastating because what it means is when the city needs to borrow money to pay for things like fixing roads or street lights, that money will cost a lot more.
Moody's pulled the credit rating in part because the city's urban renewal and industrial development agencies, both headed by Mayor Richard Thomas, have not been properly audited in three years.
The City Council and the comptroller blame the mayor, insisting he's responsible for those audits, using the agencies' own funds. The mayor believes the city should foot the $50,000 bill.
While politicians are pointing fingers at each other, taxpayers could be the ones hurt. The dean of financial business students at Iona College says the costs of having no credit rating will undoubtedly be passed along to homeowners in the form of higher taxes. He believes this could be an issue haunting the city for years to come.