State’s credit rating now safe again
- PAUL—The legal showdown between Gov. Mark Dayton and the Republican-controlled Legislature is no longer threatening Minnesota’s credit rating.
Dayton’s June veto of the House and Senate’s funding had raised the possibility that workers could go unpaid and that the Senate could miss payments on its new office building. Responding to that possibility, rating agency Standard & Poor’s put Minnesota on a “negative” watch list — a threat to downgrade the state’s strong credit rating. Two other credit rating agencies declined to follow suit, and now S&P is backing off. The key factor: a judge-approved deal to keep the Legislature funded while the legal battle winds its way through the courts.
“In our view, the court order gives the state time to work out its political differences and solve its budgetary issues” before its next debt service payment, S&P’s report said.
With that imminent danger removed, S&P said the state’s “strong (budget) management” warranted keeping Minnesota’s current AA+ rating.
A district judge is currently weighing whether Dayton has the authority to strike the Legislature’s funding with his line-item veto power, or if that’s unconstitutional.
(St. Paul Pioneer Press)