Wall Street’s top bond-rating agencies confirmed Georgia’s top-shelf financial status Friday, but one warned that the state faces an additional $360 million in budget cuts this fiscal year.
Moody’s, Fitch and Standard & Poor’s review every state’s financial health and awards a grade. Those grades are used by banks to set an interest rate for the state when it goes to sell revenue bonds for capital projects and other uses. The higher the bond-rating, the lower the interest. Tens of millions of dollars in interest and debt service are at stake.
All three rating agencies gave Georgia their highest – the coveted triple-A – rating, making it only one of seven states to maintain that status.
But, in its analysis of the state’s financial situation, Moody’s said Georgia state revenues are expected to drop by $1.26 billion in the current fiscal year. In August, Gov. Sonny Perdue lowered his revenue estimate by $900 million – or $360 million less than what Moody’s said is likely.