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Bond rating agency hammers NH state credit rating
“The practical effect of the change in outlook is a potentially higher cost of capital at the time of the state’s next GO (general obligation) bond issue in December; however I believe that sufficient time will lapse between now and then so that the groundwork for a positive resolution will be in place,” Dwyer said in an email Tuesday.
“The negative outlook reflects our view of the state’s thin financial position and significantly underfunded pension funding levels, which we believe lowers its flexibility to withstand the potentially large effects of the loss of Medicaid Enhancement Tax (MET) revenue,” it said.
S&P also said the state pension fund was only 56.7 percent funded, “well below that of most other states, which we believe could result in additional pressure on future budgets.”
Republican State Committee Chairman Jennifer Horn said: “As governor, Maggie Hassan has blocked efforts to rebuild the rainy day fund and has opposed pension reform, putting the collective future of our state’s hard-working public servants at risk.”
“The Standard and Poor’s announcement reinforces the need for hospitals, providers, legislators and state officials to quickly work together to address the budget and health care challenges posed by the Medicaid Enhancement Tax ruling, a direct result of short-sighted action taken in the FY 12/13 budget,” Hassan said.
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