Long Beach bond rating reaffirmed
A credit rating agency has reaffirmed Long Beach's bond rating as one step above junk-bond status and improved the city's outlook from negative to stable.
Moody's Investors Service of Manhattan on Friday released a report that said the improved outlook "reflects improved fiscal controls and policies implemented by a new management team beginning January 2012."
In December 2011, the service downgraded the city's credit rating from A1, which its website defines as "upper-medium grade," to Baa3, which means "moderate credit risk."
A new Democratic-led city administration took office a month later, replacing the Republican leadership.
The former administration had created an $18 million deficit and spent $21 million in surplus between 2008 and 2012, according to a report issued in July by state Comptroller Thomas P. DiNapoli.
"We are extremely pleased that Moody's is applauding this administration for restoring fiscal responsibility in Long Beach," City Council President Scott Mandel said in a statement.
The Moody's report states that Long Beach still faces fiscal challenges, such as managing costs related to superstorm Sandy repairs and fallout from the city's "past structural imbalance."
But the city has made strides to dig out of its fiscal crisis, Moody's spokesman David Jacobson said.
"We've seen some positive changes since the new administration took office," Jacobson said. "They've introduced some positive budgeting practices."
The bond rating affects the city's interest rate.