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Dover Schools Financial Information:
WEBSITE PRESS RELEASE
APRIL 30, 2003
TOWN OF DOVER ISSUES $14,575,000 IN BONDS
The Town of Dover issued $14,575,000 in general obligation
municipal bonds effective April 15, 2003 for the construction
of the new Chickering School. The successful bidder
for the bonds was UBS PaineWebber Inc. The true interest
cost for the entire issue was 3.831652 per cent. This
rate is extremely favorable, at near historic lows,
and was the result of both a very favorable interest
rate environment in the financial markets generally,
and the Town's AAA bond ratings from both Moody's
and Standard and Poors. Although Standard and Poors
had rated the Town's previously issued debt AAA, the
upgrade to Aaa status from Moody's was awarded due
to Dover's strong financial position, supported by
experienced management, and the Town's willingness
to support Proposition 2 1/2 overrides. There are
only 12 other municipalities in Massachusetts with
Aaa ratings from Moody's.
Town of Dover Board of Selectmen
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Standard
& Poors
Dover, Massachusetts
Joshua R Mclntyre, Boston (1) 617-371-0303;
Karl Jacob, New York (1) 212-438-2111
Rationale
The 'AAA' rating on the town of Dover, Mass.'
GO bonds reflects the town's:
- Strong management, which ha's managed resources
well and built reserves;
- Very high wealth and income levels;
- High-end, predominantly residential tax
base that continues to exhibit strong valuation
appreciation; and
- Manageable debt position.
The town's
full faith tax pledge secures the bonds. Dover,
with a population of 5,558, is an affluent,
predominantly residential suburb 20 miles southwest
of Boston, Mass. The tax base is 98% residential
and comprised of large, high-end homes. Assessed
valuation has grown 59% since fiscal 1999 to
$1.7 billion for fiscal 2003. Market value is
very high at $309,000 per capita. Data from
the U.S. Census Bureau indicates that Dover's
median family income was 255% and 314% of state
and national levels, respectively, in 2000.
Although the town's unemployment has increased
to 2.4% in January 2003 from 2.0% in 2001, rates
remain well below the state's and nation's levels.
The town's financial position is strong and
supported by experienced management and the
electorate's willingness to approve exemptions
from the constraints of Proposition 2 1/2. The
general fund has reported surpluses going back
at least five years, and fund balances have
been consistently
strong. At fiscal year-end 2002, the general
fund balance was $4.2 million, or 24% of expenditures;
and the unreserved fund balance was $3.2 million,
or 18% of expenditures. The town also maintains
a $525,000 stabilization fund, which is an additional
3% of expenditures. The town is not reliant
on state aid for revenues; in fiscal 2002, 84%
of revenue came from property taxes while just
4% came from state aid. New growth and other
local receipts should more than offset a $20,000
state aid cut, which was announced in January
2003. For fiscal 2004, the town is proposing
a $350,000 override to its voters.
The electorate has consistently approved operating
overrides in the past; the town expects the
current proposal to also be approved.
Nearly 70% of Dover's $22.4 million of total
debt is school related. The current bonds are
being issued to permanently finance bonds outstanding,
which were used to finance the construction
of anew elementary school. The state will reimburse
the town for 55% of its school-related construction
expenses. Overall net debt of $13.8 million
is a relatively high $2,476 per capita but just
0.8% of market value. In addition, the town
will be responsible for $8.8 million of net
debt--after state reimbursement of 57%--for
construction costs at Dover-Sherborn Regional
High School, adding another $1,574 per capita.
All of Dover's debt is exempt from Proposition
21/2's constraints.
Outlook
The stable outlook reflects the expectation
of continued strong management, financial operations,
and tax base growth.
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