Minnesota’s credit rating improves on eve of bond sale
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Minnesota has a near-perfect credit rating as Gov. Mark Dayton's tenure moves toward an end, bringing it back to where it was when the DFLer was elected in 2010.
Two bond rating agencies gave Minnesota a "AAA" rating in decisions issued Wednesday. That's the top rating and matters because entities with that rating get better interest rates when borrowing for construction projects.
Minnesota officials plan to sell $619 million in bonds next month.
Standard & Poor's gave Minnesota an upgrade while the Fitch Ratings assessment remained the same. Minnesota's strong budget management and recent steps to shore up public pensions were cited as reasons. The S&P rating urged state leaders to do more to get pension resources in line with obligations to retirees.
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The third major ratings service, Moody's Investors Service, kept Minnesota one tick below perfect, at Aa1. The agency said Minnesota has solid reserves and adheres to sound financial practices, but noted that "idiosyncratic governance issues arise from time to time."
The last time Minnesota had a universal "AAA" rating was in 2002.
The ratings slipped in Dayton's first year as Minnesota grappled with a deep deficit and depleted reserves. The reserves are now at their highest level and recent reports have shown surplus revenues.
“Our state government has made a complete financial turnaround in the past seven-and-a-half years,” Dayton said in a written statement.