Los Angeles City Gets Credit Score Downgrade by Moody's Investors Service
It was only last month that L.A. Mayor Antonio Villariagosa waived a wand and erased the city's $336 million deficit (at least on paper), turning in an optimistically balanced budget.
Looks like the folks at the Moody's credit rating service aren't impressed.
This week, according to Bloomberg ...
... they downgraded L.A.'s credit score. (As if City Hall has a jet ski with overdue payments stashed in the backyard).
The service says rising labor costs and retirement benefits aren't helping L.A.'s bottom line. And so the city's rating is going down to Aa3, Moody's fourth-highest level.
Bloomberg notes that City Hall faces another $200 million deficit next year and that "projected pension and salary increases for workers" will reach $479 million by 2015.
The downgrade affects $3.3 billion of debt, including $378 million slated to be sold next week, which means it'll cost you, the taxpayer, more to get that loan, essentially, because city leaders couldn't get L.A.'s spending under control.
City administrative officer Miguel Santana says "we still have work to do."
Yep.
[@dennisjromero/djromero@laweekly.com]
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