The bonds will be sold via competitive sale on
In addition, Fitch has affirmed the following state ratings:
The Rating Outlook for the Long-term ratings is Stable. The EMCP rating does not carry an Outlook.
The state's full faith, credit, and taxing powers, as well as the statutory irrevocable appropriation of a first lien on all state revenues for debt service, secure the GO bonds.
KEY RATING DRIVERS
BROAD, DIVERSE ECONOMY: The
FISCAL PROGRESS UNDERWAY: The state's finances have strengthened, with structural budget solutions and solid revenue gains resulting in materially stronger liquidity. The state has not yet returned to consistent structural balance as of its fiscal 2013-2015 adopted budget although revenue performance in the first year of the biennium was strong.
LIMITED RESERVES: The state's reserves, which were depleted in the last downturn, have begun growing again but remain modest. Positive revenue performance during fiscal 2014 that would have contributed to an improved reserve position was largely offset by tax reductions enacted during fiscal 2014.
MODERATE LIABILITIES: State tax-supported debt is a moderate though above-average burden on resources. Retiree obligations are minimal, with pensions virtually fully funded and limited other post-employment obligations.
CONTINUED FISCAL IMPROVEMENT: A demonstrated commitment to growing reserve funding and consistently achieving structurally sound budgets in the context of moderate debt and low retiree obligations could result in a rating upgrade.
The adopted budget for the fiscal 2013 - 2015 biennium (which began on
NARROW MARGINS FOLLOWING TAX REDUCTIONS
The state continues to adjust its tax code, offsetting revenue growth, requiring use of fund balance in the current 2013 - 2015 biennial budget, and limiting contributions to reserves.
The adopted budget for fiscal 2013 - 2015 incorporated sizable personal income tax (PIT) rate cuts taking effect in tax year 2013. PIT tax rate changes were estimated to reduce general fund revenues from baseline levels by
These changes significantly reduced the surplus projected in
DEBT AND OTHER LIABILITIES
Net tax-supported measures 5.5% of 2013 personal income, a moderate but above average level. Debt grew during the recession, including
The state's limited retiree obligations are a credit strength. Pensions were essentially fully funded as of
Additional information is available at 'www.fitchratings.com'.
In addition to the sources of information identified in the Tax-
Supported Rating Criteria, this action was additionally informed by information from
--'Tax-Supported Rating Criteria' (
--'U.S. State Government Tax-Supported Rating Criteria' (
Tax-Supported Rating Criteria
U.S. State Government Tax-Supported Rating Criteria
Source: Fitch Ratings
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