Ratings Agency Socks New Haven

Thank you for relieving me from the incessant awful news in Boston.
Not good news! Still I have to take issue with the headline. Is being downgraded from "A plus" to "A" really being "socked" as the headline suggests? I expect a little more than a sensational headline from the NHI. When did Fitch put this info out?????

A couple of notes:

Did you all hear that labor unions of New Haven?

Be part of the solution - not the problem for we the taxpayers!

CP06,

It's being socked. A downgrade means higher future borrowing costs and potentially higher debt service on some debt that might be structured with a variable interest rate (although I think Rob Smuts once publicly declared that the city has avoided such exotic instruments).

Notey, how on earth do you get to the point that the budget director is making "no big deal" about this, the same level of unconcerned that permeates throughout all City employees. His comments seem very straight forward and to the point. Especially now, I would think the unions would have loved to see a stable rating, so I think they were concerned! Who is unconcerned? Want me tell you. Everybody is concerned. This hurts every departments pocketbook as it will now cost more to borrow money, meaning less money will be available for departments to spend improving this City. How can you say that past ratings were gifts? These rating agencies gave the City of New Haven a gift when at the same time they were down grading the U S Government, C'mon! You serious? What cuts are you speaking of? How about 10% across the board? That is always a great comment, makes sense. Cut the debt service budget by 10% too, the rating agencies will understand, won't they?

Fact:

I get that there is no urgency by looking at the submitted budget which increases spending, increases debt and debt service and adds employees. Since the budget director and DeStefano both knew this was coming, that a fair analysis of our fund balances are a problem when we are currently running another deficit, I would have expected the budget and the comments post ratings decline to reflect how important it is.

Was past ratings a gift? Yes. The outlook was downgraded in 2011 but the rating was not. We were in a little better shape then than now because we still had some money in the bank. But a poor outlook is a red flag and yet, the ratings remained stable at the reduced ratings from several years earlier.

Budget solutions? Hiring freeze for starters; cap the cop budget overtime, not increase it. The same with firefighters. No increase in employee head count, and yes, make some cuts. Real cuts that reduce spending below this year's level. Across the board is easy, but kind of a blunt axe. It's better to do strategic cuts that make sense: End the licensed multi-family inspections - this loses $400K a year and has never paid for itself; end Tweed subsidy - they can raise the same money and more by charging user fees and increasing the cost of parking; end free lunches for school children - those of us that can pay should; end the street outreach worker program - we are overrun by gangs and violence; end free after school programs - do we really need to provide free day care after school?; end new school construction; get serious about risk mitigation/assessment - we lose millions of dollars a year in legal cases; do an analysis of all the private PILOTS the city has entered into over the last 20 years - is it worth it? Are they paying? The YMCA is a great example. Consolidate department and get rid of management that oversees a small department or like LCI, where you have a director and deputy director who oversees. These are just a partial list.

Noteworthy, Thank You for the additional explanation