Standard & Poor's Ratings Services lowered New Jersey's rating outlook to negative from stable, citing the state's above-average debt burden and trend of structurally unbalanced budgets. The credit-ratings company affirmed New Jersey's general-obligation debt rating of double-A-minus, which is three steps below the coveted triple-A rating.
The revised outlook reflects "the risk of revenue assumptions we view as optimistic, continued reliance on one-time measures to offset revenue shortfalls, and longer-term growing expenditure pressures," said credit analyst John Sugden.
Those pressures include pension-funding increases, Medicaid funding and debt service, S&P said.
The firm said New Jersey has already identified about $2.2 billion in budgetary gaps that would need to be closed for fiscal 2014, and these amounts don't include the expected impact of increased enrollment in Medicaid due to the Patient Protection and Affordable Care Act.
S&P said it could lower New Jersey's rating within the next two years if the state uses short-term budgetary maneuvering to close the gap, which would continue the fiscal pressures.
Poster Comment:
WHAT, WHAT, WHAT? I thought NJ voted in a lardass repuke 'savior' miracle worker...
{{{chuckle}}}
