Connecticut Blasts Moody's Bond-Rating Drop

FAIRFIELD COUNTY, Conn. - Moody's downgrade of Connecticut's bond rating is an attempt to "deflect attention from their historic lack of credibility," the governor's office said in a statement Friday. 

Moody's lowering of Connecticut's rating from stable to negative Friday "reflects their continued reaction to their central involvement in the financial scandals that led to the deepest recession since the Great Depression," said Benjamin Barnes, the state's secretary of the Office of Policy and Management.

"Connecticut has done all the right things to shore up our finances," Barnes said. "Connecticut has always paid its debt and remains an attractive issuer of public debt.  Investors appreciate Connecticut’s strong income levels, conservative debt management practices, and fiscally conservative leadership."

Connecticut's rating had been at "stable" since April 2010, and its fiscal health has significantly improved since then, Barnes said. Moody’s receives $170,000 per year in fees from the state for its bond rating, Barnes said.

The other agencies that rate the state's debt, Standard & Poor’s and Fitch, continue to rate Connecticut debt as AA, which is equivalent Moody’s rating before Friday's downgrade, he said. 

Part of Moody's explanation for the downgrade can be found in this article by Forbes. 

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