Maryland State Treasurer
Treasurer Kopp said, "Today's news of
"Retention of the Triple AAA ratings allows us to continue to save millions of taxpayer dollars resulting from the lower interest rates achieved because of these ratings," Treasurer Kopp said.
Fitch, in assigning its AAA rating and stable outlook, said: "Debt oversight is strong and centralized, and the debt burden is moderate. The state has policies to maintain debt affordability, and the constitution requires GO [General Obligation] and transportation bonds to amortize within 15 years."
Fitch Ratings further said: "Financial operations are conservative, with the state consistently demonstrating a strong commitment to budgetary balance through the downturn, including through repeated spending cuts, fund balance transfers and revenue increases. The state has also maintained flexibility in the form of its rainy day fund (RDF), which remained funded at or near 5% of general fund revenues through the downturn."
Moody's, in explaining its Aaa rating and stable outlook said: "The highest quality rating reflects
Moody's also noted that "Consistent with its history of strong financial management, the state has been appropriately addressing its structural budget gap and pension funding concerns even under pressure from federal budget reductions."
In assigning its 'AAA' long-term rating and stable outlook, Standard & Poor's said: "The rating reflects what we view as the state's: Broad and diverse economy, which has experienced tepid recovery due to sequestration and federal fiscal policy uncertainty; we expect growth to accelerate due to resolution of certain federal budget and fiscal issues; High wealth and income levels; Long history of proactive financial and budget management, including implementation of frequent and timely budget adjustments to align revenues and expenditures; Well-developed financial and debt management policies including long-term financial planning that should be helpful in addressing future budget challenges; and Moderate debt burden, which we expect to continue due to a clearly defined debt affordability process that limits annual issuance, coupled with a constitutional 15-year debt maturity schedule."
Standard and Poor's further stated: "The stable outlook on
All three rating agencies praised
Each rating agency recognized
Each of the rating agencies recognized significant pension funding challenges as well as reforms enacted over the past three years. Moody's indicated "[l]ow retirement system funded levels" represent a credit challenge for the state and "[f]ailure to adhere to plans to address low pension funded ratios" could make the rating go down. Fitch Ratings noted "Despite pensions being a comparative credit weakness, the state has taken multiple steps to reduce the burden of pensions." While acknowledging that "[b]ased on the reforms..., the state's actuary projects that the system will be 80% funded by 2024 and full funding will be achieved by 2039", S&P indicated "[t]he state's below-average pension funded ratios continue to represent downside risk to the rating."
The bond sale will include three competitive bids which are expected to be sold to institutions. The sale will include
As has always been the case with the issuance of
The Maryland State Treasurer's Office expects to conduct another bond sale in July or
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