Oops! The playground of New York’s elite defaults on its debt


As if Suffolk County, home of the Hamptons and playground of the rich and famous on New York’s Long Island, didn’t have enough financial problems already.

A regulatory filing on behalf of the county dated April 16 shows it accidentally missed an interest payment on some of its debt, including $76.1 million (R703m) of public improvement bonds, putting the county technically in default. Oops.

It is more of an embarrassing glitch than anything else. The missed payment – just $722.65 – would be small change for many of the county’s residents. It will buy you fewer than 20 butter-poached lobster rolls (not the most expensive thing on the menu) at Dave’s Grill in Montauk, a quaint fishing village on the island’s northern tip.

The county is wealthy, with income per capita well above the national average, but it has run into difficulty recently, declaring a fiscal emergency last year after an independent task force predicted a three-year deficit of $530m. The county could have a budget shortfall of as much as $250m by the end of next year, local officials said last month.

Fitch Ratings, the credit ratings agency, downgraded Suffolk County’s general obligation bond rating to A from A-plus last month. Fitch said it had concerns about the county’s ability to become financially stable, let alone reduce its big deficit. – Reuters

Share this story