S&P raises Connecticut's credit outlook to positive ahead of $1.475 billion bond sale
S&P Global Ratings cited the state's work to reduce unfunded pension liabilities while keeping budgets balanced. The treasurer's office plans a four-part general obligation bond offering the week of Oct. 5.
S&P Global Ratings has revised its outlook on Connecticut's credit rating from stable to positive, Gov. Ned Lamont and state Treasurer Erick Russell said Friday.
In its announcement, S&P said the revision "reflects our view of Connecticut's commitment to reducing its high unfunded pension liabilities while sustaining budgetary balance and healthy reserves." The ratings agency said it also expects the state to maintain "its commitment to fiscal balance and reducing long-term liabilities in the next fiscal biennium," without significantly changing the guardrails it adopted to support budget predictability, lower unfunded pension liabilities and limit annual debt issuance.
The governor's office said Connecticut has received eight credit rating upgrades since Lamont took office. Before his administration, the state's most recent general obligation bond rating upgrade came in 2001, according to the office.
Lamont said the state is "rapidly paying down its long-term debt, reducing fixed costs for taxpayers, and strengthening the retirement systems upon which our public employees depend." Russell said the outlook reflects "measurable progress in reducing long-term pension liabilities" and that stronger credit ratings help lower borrowing costs.
The announcement comes shortly before a planned bond sale. Russell's office intends to offer $1.475 billion in general obligation bonds in four series during the week of Oct. 5, the treasurer said.
That includes $800 million in tax-exempt bonds and $300 million in taxable bonds to pay for new projects, among them economic development initiatives, municipal and nonprofit investments, urban action grants, school construction, agricultural land preservation and capital improvements. The remainder, about $242 million and $133 million in two series of refunding bonds, will refinance previously issued bonds to lower interest costs, according to the release.
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