State’s bond rating upgraded again
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Standard & Poor’s upgraded the state’s bond rating Friday — a move that one state official characterized as “huge.”
It was the second upgrade in two days for the state and signals to investors a lowering in the risk of lending money to Louisiana.
S&P attributed the raised ratings to the state’s strong management and “commitment to streamlining its government functions.”
The rating agency said Louisiana is performing “significantly better than most other large states in the country.”
State Treasurer John Kennedy said the rating increase will lower the cost for taxpayers when the state borrows money in the future. “The Legislature deserves a lot of credit here. We receive these rating increases primarily because of the fiscal management in what’s been a difficult time,” he said.
In addition to upgrading the state’s bond rating, S&P gave Louisiana a stable outlook.
Moody’s Investor Services raised the state’s credit outlook from stable to positive. A day earlier, Fitch Ratings also upgraded the state’s bond rating.
Kennedy said the upgrades will probably save the state $2.7 million over 20 years on general obligation bonds. He said state officials recently gave presentations to the rating agencies.
The upgrades mean the state is in better shape than other states even though things aren’t great economically, Kennedy said.
The state is facing a $1 billion shortfall in the fiscal year that starts July 1, 2010.
House Speaker Jim Tucker, R-Terrytown, said the changes will drive down interest rates when the state borrows money.
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