Statement from S&P: "Standard & Poor's Ratings Services said today it raised its long-term rating and underlying rating on Philadelphia's general obligation debt one notch to 'A-' from 'BBB+'." S&P also rated the city's 2013 general-obligation bonds A-. Higher-rated bonds typically can be sold at lower interest rates, saving the city money.
"The upgrade reflects our assessment of the city's progress in restoring its general fund balance through cost containment as well as stronger revenue streams," Standard & Poor's credit analyst Hilary Sutton said in a statement. SUP also boosted Philadelphia Redevelopment Authority, Philadelphia Industrial Development Authority, Philadelphia Municipal Authority debt to A-.
Sutton praised Mayor Nutter's "proactive administration that has taken action to rebalance operations during a difficult recession, evidenced by surpluses in fiscal years 2010, 2011, and 2012 that have helped reverse a trend of general fund deficits," along with state oversight by Sam Katz's Pa. Intergovernmental Cooperation Authority, and the city's increased reliance on hospitals and colleges as major employers. Though recession, high pension costs, and all the money borrowed under Mayors Rendell and Street continue to haunt the city's finances, she added. Nutter keeps on borrowing to refinance old debt and for new capital spending.