Moody’s upgrades Maine’s outlook from “stable” to “positive”
Governor Janet Mills and State Treasurer Henry Beck announced today that Moody’s Investors Service and S&P Global Ratings, global companies that analyze and issue reports of credit worthiness, have affirmed their strong credit ratings on the State of Maine’s general obligation debt. Moody’s affirmed their Aa2 rating and upgraded their outlook from stable to positive. S&P affirmed their AA rating and stable outlook.
In its affirmation, S&P applauded Maine’s “good financial policies and budgetary management” as well as the state’s “stable government framework”. Moody’s cited Maine’s “strong financial reserves,” writing that “the biennial budget for fiscal years 2024-2025 is structurally sound” and that “the state's finances will remain in solid shape thanks to strong fiscal governance.” Moody’s attributed its upgrade of Maine’s outlook from ‘stable’ to ‘positive’ because of Maine’s “continued GDP growth at or above the national rate,” and Maine’s growing population and employment rates.
Moody’s and S&P have reaffirmed Maine’s credit ratings every year since Governor Mills and Treasurer Beck took office.
“These positive ratings and the improved outlook from Moody’s confirm our good and responsible fiscal management of the state and the effectiveness of our policies. Maine’s budget is balanced, our Rainy Day Fund is at a record high, our unemployment rate is at a record low, we have a record number of jobs, and our economy is strong, despite the challenges we face,” said Governor Janet Mills. “We will continue to invest in Maine people to build a stronger, more prosperous state, and we will do so while meeting our obligations and living responsibly within our means.”
“Governor Mills and the Legislature have been wise and deliberate in growing our reserves and spending for important priorities within our means,” said Henry Beck, Maine State Treasurer. “These reports confirm that investors and taxpayers should have faith in Maine’s credit and financial management. Maine bonds and Maine’s future are both a good investment.”
Maine has a balanced budget, and Governor Mills and the Legislature have built up the Budget Stabilization, or “Rainy Day”, Fund to a record high of $911.3 million, an increase of more than $701 million since taking office in 2019.
Additionally, under Governor Mills’ leadership, Maine’s GDP has grown by 8.8 percent – the 8th best rate of growth in the nation and the best rate of growth in New England. Personal income has also grown by 19.6 percent in Maine from 2019 to 2022, ranking 14th best in the country and best in New England. The unemployment rate has dropped to a new record low of 2.4 percent, below both the New England and U.S. averages, with Maine’s total private employment reaching a new record high of 539,300 filled jobs in 2022.
In 2022, Maine had the 11th highest net migration rate in the United States and the highest rate in New England. Maine was also the only state to see a decrease in median age from 2020-21, led by increased migration of younger populations into the state.
“The affirmation of our positive ratings is a testament to the Governor’s prudent budgeting, her commitment to building a record high savings, and her work to strengthen Maine’s economy by investing in our people,” said Kirsten Figueroa, Commissioner for the Department of Administrative and Financial Services. “Maine’s updated positive outlook demonstrates the effectiveness of the Governor’s policies and its positive impact on our state.”
Governor Mills’ fiscal prudence has maintained a solid cash position with an average daily balance of more than $4 billion, allowing for internal borrowing for capital projects to avoid unnecessary finance fees and expenses.
Treasurer Beck, Commissioner Figueroa, the State Economist, and other members of the Executive Branch presented to Moody's and S&P via telephone on May 25, 2023.