Two credit rating agencies warn Washington state over budget
OLYMPIA, Wash. – Two credit rating agencies have delivered a warning to the State of Washington to get its financial house in order. The ratings agencies lowered the outlook for Washington state debt, citing the magnitude of the budget shortfall.
Washington state is refinancing or selling more than $1 billion in bonds in the coming weeks. That's the reason Standard & Poor's (S&P), Moody's Investors Service and Fitch Ratings revisited the state's credit rating.
All three maintained Washington's current AA+ rating (Aa1 in case of Moody's). But Moody's and Fitch lowered their outlooks from "stable" to "negative."
Washington State Treasurer Jim McIntire says the analysts see the legislature having limited options to close its budget gap.
"They are concerned about our ability to actually meet the budget deadline and balance the budget."
McIntire says he hopes the two skeptical ratings agencies will restore the "stable" outlook once state leaders rebalance the budget. In the meantime, he says it's possible some bond buyers will demand a slightly higher interest rate.
Oregon and Idaho have the same credit rating currently as Washington, at AA+. Both neighboring states also have a "stable" outlook on their public debt, as opposed to "negative."
On the Web:
- A brief history of S&P's state credit ratings
- Washington state credit ratings
- Moody's rating
- Standard & Poor's rating
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