Montgomery County's fiscal future is stable — at least for now, County Executive Isiah Leggett (D) said Wednesday. The county has maintained its AAA bond rating, and one rating agency that placed the county on a "watch list" in April moved the county to the "stable outlook category."
The AAA bond rating, which is considered the gold standard, determines the rate at which the county borrows money to pay for capital projects. The county will competitively bid $325 million in general obligation bonds Thursday to pay for items such as school construction.
Moody's, Standard and Poor's, and Fitch all maintained their AAA ratings for the county's general obligation bonds. Moody's rating, which was most in jeopardy, was received Wednesday. In an announcement Wednesday, Leggett credited the rating to his more conservative fiscal approach that the council adopted last week, and a commitment to increase reserves from 6 percent of the county's general fund to 10 percent in the next nine years.
Council President Nancy M. Floreen (D-At large) of Garrett Park, who first recommended that the council adopt a six-year fiscal plan for the county, said the plan also adopted by the council last week will put the county on steadier financial ground.
"The council has never done that before," Floreen said of the plan.
Leggett said the plan, the more conservative fiscal policies and the commitment to bolster the county's reserve fund should help the county in fiscal 2012. The county filled a $1 billion budget deficit in fiscal 2011. Councilwoman Duchy Trachtenberg (D-At large) of North Bethesda, who chairs the council's Management and Fiscal Policy Committee, said Wednesday that the council responded to concerns from residents and bond rating agencies that the county needed a more responsible spending plan.
"(The) clock has finally run out on the thought that government can spend without consequence or make budget policy without discipline," she said. SOURCE: Gazette