Ratings Agencies Downgrade New Haven's Financial Outlook

Aug 1, 2012

Last week  two ratings agencies changed their financial outlook for the city of New Haven from stable to negative. Mayor John DeStefano says he can’t disagree with that.

Mayor DeStefano says he’s pleased that Standard and Poor’s and Fitch Ratings did not downgrade New Haven’s credit ratings. The actual ratings were affirmed. But the city’s financial outlook declined.  

"Reason for that, because the city ran a budget deficit in the current year. I can’t disagree with that assessment that the agencies have made from stable to negative given fact we’re running a deficit."

DeStefano says city governments, state and federal governments are all faced with citizens who want to keep the same level of services they’re used to in a down economy.

"Interestingly in New Haven, we’ve had good growth in the economy. Our challenge as the ratings agencies particularly point out, is the need to resolve some of our employee, pension and health costs", which he says will take time.   

The New Haven Independent reports that the city may soon announce a $7.5 million budget deficit.