bonds remain A-A-A despite
Standard & Poor's U.S. debt downgrade
County government still has its triple-A bond ratings
and it expects to keep them.
financial officer Ed Milowicki told County Council's
finance committee that Moody's Investors Service lowered
its rating outlook from 'stable' to 'negative' after
Standard & Poor downgraded its rating on U.S. Treasury
bonds. That was expected to have repercussions
throughout the entire municipal debt structure.
But he added
that Moody's is the only one of the 'big three' rating
agencies his office has heard from and indicated that he
does not regard its move as particularly significant. "I
don't have any concerns [about it]," he said at the
committee meeting on Sept. 13.
"They were under
such pressure that they had to do something so they did
New Castle is
one of only 37 county governments around the country
which have the top rating from all three agencies. Fitch
Ratings is the other one.
he doesn't know if there have been any changes in the
standings of the other 36 counties.
years county government's maintaining the triple-A
rating has been a practical matter as well as a bragging
How bonds are
rated is important because that determines at what
interest rate underwriters and investors are willing to
buy the long-term bonds. That, in turn, affects how much
the government has to pay to service the debt during the
life of the bonds.
At the same time
the top rating is considered an acknowledgement by
impartial professional observers that county finances
are being managed in a responsible and prudent way.
he has been unable to determine why Moody's modified its
outlook, which supposedly reflects its opinion about
what to expect in the future. Referring to his request
for an explanation, "we haven't heard anything further
from them," he said.
added, "I'd like to see them put us back to 'stable'."