S&P gives Suffolk 'negative outlook'

Wall Street rating agency Standard & Poor's, worried about Suffolk County's use of rainy day funds, has raised a financial red flag, giving the county a "negative outlook" for its upcoming $101.1-million borrowing.

While issuing a financial warning, Standard & Poor's maintained the county's AA rating, citing Suffolk's strong and diverse economy, substantial tax base despite recent declines and overall moderate debt burden.

Connie Corso, Suffolk's budget director, called the ratings "good news," noting Suffolk has maintained its high bond ratings with all three ratings agencies. "It will not change the interest rates the county pays," she said.

Standard & Poor's said the county's financial position has "deteriorated due to ongoing weakness in economically sensitive revenues, notably sales tax" as well as drawdowns on its reserve fund since 2006.

S&P's negative outlook comes after Fitch Ratings in December lowered Suffolk from a AA rating to a AA-minus for similar reasons.

Moody's Investors Service last week maintained Suffolk's Aa2 rating with a stable outlook for the borrowing, which will take place tomorrow.