Posted on 06/03/24
| News Source: FOX45
Baltimore, MD - June 3, 2024 - A recently released credit rating report says Maryland's financial outlook is taking a turn for the worse.
Moody’s Ratings downgraded Maryland’s financial outlook from stable to negative in a release last Tuesday. The credit rating agency affirmed the state’s issuer and general obligation bond ratings at the “Aaa” status, despite the change in the state's financial outlook.
Moody's stated that its financial outlook for Maryland has changed due to recent decisions made by the state's government.
The outlook revision was driven by expected structural imbalances and planned depletion of General Fund surplus and budgetary reserves by about 60% from fiscal 2023 through fiscal 2025,” Moody’s said. “[This] threatens to undermine performance relative to peers.”
The rating agency said it is hopeful Maryland will "regain structural operating balance" in the state's next budget cycle.
Moody’s also said it downgraded the credit rating outlooks for the following state programs from stable to negative:
The report stated that continued decreases in lottery and tax revenue could lead to downgrades in bond ratings for the entities mentioned.
"I do worry that certain special interest groups will again push for billions in tax hikes but Marylanders need to know that it's not necessary," Maryland state Sen. Justin Ready, R-Carroll County, said. "We just need the Democratic supermajority in Annapolis to embrace fiscal reality and hold firm against raising the cost of living when we can least afford it."
Former Maryland Gov. Larry Hogan issued a statement Monday addressing the state's outlook downgrade.
I am saddened to see Maryland’s fiscal trajectory heading in the direction of Washington, D.C.,” Hogan said. “I hope this downgrade is a wake-up call to abandon all the talk in Annapolis of record tax increases and more reckless spending.”
Hogan, a Republican, has gained national attention as he competes with Prince George’s County Executive Angela Alsobrooks for the state’s open U.S. Senate seat.
Soon after taking office, Gov. Moore took swipes at his predecessor.
Our budget problems started long before I took office,” Gov. Moore said in December. “We might not have caused this problem but we will address the problem.”
Hogan said days before departing Annapolis that he was leaving the state with a $5 billion surplus.
“I inherited the worst financial situation the state had ever been in and now, I’m turning it over to Gov. Moore in the best financial state it’s been in,” Hogan said in December.
One year after Gov. Moore took office, the Maryland General Assembly grappled with a $761 million budget shortfall, eliminating the state’s previously existing surplus.
While state legislators rejected attempts for widespread tax hikes during this year’s General Assembly session, car ownership fees were significantly raised. State car registration fees will increase by 60 to 70% on July 1. The last time this fee was increased was in 2004.