Fitch Affirms Maine Bond Rating, Reports Stable Outlook
April 1, 2015
For Immediate Release: Wednesday, April 01, 2015
Contact: Adrienne Bennett, Press Secretary, 207-287-2531
AUGUSTA – Fitch Ratings, a leading provider of credit ratings, announced today that they have affirmed their credit rating on the State of Maine’s general obligation debt. Fitch affirmed their ‘AA’ rating and reported that Maine’s rating outlook was stable.
According to Fitch, the ‘AA’ rating reflects the State of Maine’s “steady revenue performance and very manageable long-term liabilities.”
“Our administration’s reforms are working for Maine,” said Governor Paul R. LePage. “It was Republican-led efforts that reformed Maine’s welfare programs and the public pension system. In addition, we have been recognized for increasing revenue in the budget stabilization fund. However, the rating could have been upgraded further had the Legislature been willing to add more to the budget stabilization fund, as I had recommended. We must protect Maine’s bond rating by continuing to make decisions based on sound fiscal responsibility, not political rhetoric.”
As part of their credit analysis, Fitch cited Maine’s public pension reforms, “major changes” to the MaineCare program and an increased balance of the budget stabilization fund as positive factors contributing to their affirmed rating. The pension reforms, which were proposed by Governor LePage during the 125th Legislature, reduced the state’s unfunded public pension liability from $4.1 billion to $2.4 billion, a decrease of 41 percent.
“Today’s rating from Fitch is a positive for the State of Maine and highlights the prudent fiscal and budgetary management of our state,” said Department of Administrative and Financial Services Commissioner Richard Rosen. “Despite these strengths, the rating also recognizes the serious constraints our demographic trend imposes on economic expansion and Maine’s workforce. We need in-migration of talented and skilled workers, and today’s rating reinforces the importance of Governor LePage’s tax reform plan to Maine’s future.”
Fitch Ratings does not officially rate future bond sales of the State of Maine. Standard & Poor’s and Moody’s Investor Services are the rating agencies officially responsible for rating State of Maine bond sales.