August 18, 2010
Fitch Rates State's Short-Term Debt Highly
By Matthew L. Brown
Fitch Ratings has given the Bay State's $1.2 billion in general obligation revenue anticipation notes an F1+ rating, the highest of the firm's short-term credit ratings.
The notes are expected to sell through a competitive bid today. The state does most of its cash flow borrowing through revenue anticipation notes and uses the proceeds to make quarterly local aid payments.
The notes must be repaid by June 30.
Fitch said the state should not have any problem repaying the notes, has a "fundamentally strong and wealthy economy" and has "benefited from conservative budgeting and sound financial practices over time."
Fitch noted that Massachusetts' overall debt levels are high and that its revenue stream is "somewhat volatile."
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