New York, November 16, 2012 -- Moody's Rating

Issue: Public Improvement (Serial) Bonds- 2012 Series A; Rating: A1; Sale Amount $19,330,000; Expected Sale Date: 12/5/2012; Rating Description: General Obligation

Opinion

Moody's Investors Service has assigned a A1 rating and negative outlook to the Town of Ramapo's (NY) $19.3 million Public Improvement (Serial) Bonds - 2012 Series A. At this time, Moody's maintains the A1rating and negative outlook on $88 million of outstanding general obligation bonds and $23.5 million of outstanding GO-guaranteed revenue bonds issued by the Ramapo Local Development Corporation. The notes and the general obligation bonds are secured by a general obligation pledge as limited by the Property Tax Cap - Legislation (Chapter 97 (Part A) of the Laws of the State of New York, 2011). The Local Development Corporation bonds are secured by the Town of Ramapo's unconditional obligation to make payments to the trustee and, as such, the bonds carry the town's general obligation rating. Proceeds from the notes will be used to permanently finance bond anticipation notes that mature on December 5.

SUMMARY RATINGS RATIONALE

The A1 reflects significant erosion of the town's financial flexibility stemming from two consecutive years operating deficits from agressive revenue assumptions and inability to offset mid-year shortfalls. The rating also incorporates the town's sizable tax base benefiting from above-average wealth levels and average debt burden with considerable exposure to guaranteed debt for the Ramapo Local Development Corporation.

The negative outlook reflects our expectations that operations will continue to be challenged in fiscal 2012 and 2013 due to volatile economically sensitive revenues and addressing contractual personnel and benefit costs amidst 2% levy cap.

Effective January 1, 2012, all local governments in New York State are subject to a property tax cap which limits levy increases to 2% or the rate of inflation, whichever is lower. While school district debt has been exempted from the cap, debt has not been exempted for all other local governments. Moody's believes that the risks associated with the property tax cap remain unchanged and we do not foresee making a rating distinction between debt subject and not subject to the cap. For more information regarding the property tax cap please reference the Special Comment "New York Local Governments' Debt Under New Property Tax Cap to Be Rated the Same as Unlimited Tax General Obligation Debt " released May 14, 2012.

STRENGTHS

-Sizable tax base with above-average wealth levels

-Average debt burden

CHALLENGES

-Reliance on economically sensitive revenue streams which have historically underperformed budgeted expectations

-Addressing rising contractual fixed costs amidst 2% levy cap

-Exposed to debt associated with a non-essential enterprise

OUTLOOK

The negative outlook reflects our expectations that operations will continue to be challenged in fiscal 2012 and 2013 due to volatile economically sensitive revenues and addressing contractual fixed costs amidst 2% levy cap.

WHAT COULD MAKE THE RATING GO UP (REMOVAL OF NEGATIVE OUTLOOK)

-Demonstrated ability to sustain balanced operations

-Sizeable increase in tax base size

-Significant improvement in financial reserves

WHAT COULD MAKE THE RATING GO DOWN

-Severe tax base declines

-Continued inability to maintain balanced operations resulting to additional fund balance declines

-Erosion of cash position

PRINCIPAL METHODOLOGY USED

The principal methodology used in this rating was General Obligation Bonds Issued by U.S. Local Governments published in October 2009. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

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Dora Lee Analyst Public Finance Group Moody'sInvestors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653Edward Damutz VP - Senior Credit Officer Public Finance Group JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653 Releasing Office: Moody's Investors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653(C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

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