Stable budget means California will pay less to borrow<\/i><\/p>\n
by Brian Leubitz<\/p>\n
For several years now, California has languished at the bottom of the barrel of the credit ratings of the states. However, today S&P upgraded our credit rating, leaving Illinois fully behind us. (Though that state had previously slipped behind us in Moody’s rating<\/a>) Illinois is still facing some big issues as they struggle to pull themselves out of a similar morass as California experienced a few years ago.<\/p>\n Standard & Poor’s Ratings Services on Thursday raised California’s credit rating from “A-” to “A” the long-term ratings on much of California’s bond debt. The upgrade covers $73.1 billion in general obligation bonds and $1.9 billion in Proposition 1A bonds. … <\/p>\n The ratings agency’s commentary said the “upgrades reflect our view of California’s improved fiscal condition and cash position, and the state’s projections of a structurally balanced budget through at least the next several years.” (Sac Biz Journal<\/a>)<\/p><\/blockquote>\n That being said, our state was never really a threat to default. Our constitution specifically forbids it, and Bill Lockyer has pointed this out many, many times. <\/p>\n California has never failed to make its bond payments on time and in full, not even during the Depression. And there is no chance we will smudge that pristine record.<\/p>\n Payment of debt service is constitutionally protected, with bond payments required even when the state is operating without a budget. Debt service has second call on general fund dollars, right behind education. Under the California Constitution, making sure bond investors get their money is a higher priority than providing healthcare to kids, protecting the environment and keeping our communities safe.(LA Times<\/a>)<\/p><\/blockquote>\n These words are just as true now as when they were first published in 2010. Yet, hey, now we’re getting upgraded, so hooray?<\/p>\n","protected":false},"excerpt":{"rendered":" Stable budget means California will pay less to borrow<\/i><\/p>\n by Brian Leubitz<\/p>\n For several years now, California has languished at the bottom of the barrel of the credit ratings of the states. However, today S&P upgraded our credit rating, leaving Illinois fully behind us. (Though that state had previously slipped behind us in Moody’s rating<\/a>) Illinois is still facing some big issues as they struggle to pull themselves out of a similar morass as California experienced a few years ago.<\/p>\n Standard & Poor’s Ratings Services on Thursday raised California’s credit rating from “A-” to “A” the long-term ratings on much of California’s bond debt. The upgrade covers $73.1 billion in general obligation bonds and $1.9 billion in Proposition 1A bonds. … <\/p>\n The ratings agency’s commentary said the “upgrades reflect our view of California’s improved fiscal condition and cash position, and the state’s projections of a structurally balanced budget through at least the next several years.” (Sac Biz Journal<\/a>)<\/p><\/blockquote>\n That being said, our state was never really a threat to default. Our constitution specifically forbids it, and Bill Lockyer has pointed this out many, many times. <\/p>\n California has never failed to make its bond payments on time and in full, not even during the Depression. And there is no chance we will smudge that pristine record.<\/p>\n Payment of debt service is constitutionally protected, with bond payments required even when the state is operating without a budget. Debt service has second call on general fund dollars, right behind education. Under the California Constitution, making sure bond investors get their money is a higher priority than providing healthcare to kids, protecting the environment and keeping our communities safe.(LA Times<\/a>)<\/p><\/blockquote>\n These words are just as true now as when they were first published in 2010. Yet, hey, now we’re getting upgraded, so hooray?<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[],"tags":[302],"class_list":["post-14826","post","type-post","status-publish","format-standard","hentry","tag-302"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack-related-posts":[],"jetpack_shortlink":"https:\/\/wp.me\/p6Pvhz-3R8","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts\/14826","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/comments?post=14826"}],"version-history":[{"count":0,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/posts\/14826\/revisions"}],"wp:attachment":[{"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/media?parent=14826"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/categories?post=14826"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/calitics.com\/index.php\/wp-json\/wp\/v2\/tags?post=14826"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}