HARRISBURG, Pa. (AP) – A credit rating agency is putting Pennsylvania on notice that it faces another downgrade that increases the cost of government borrowing if the state doesn’t improve its finances.
Standard and Poor’s on Thursday said putting Pennsylvania on a negative “creditwatch” reflects Pennsylvania’s eroding financial position. It says it also reflects its view that there’s a “significant likelihood” that Pennsylvania state government won’t pass a structurally balanced budget for the fiscal year that began Saturday.
Pennsylvania is struggling with an entrenched post-recession deficit, and credit downgrades in 2012 through 2014 left Pennsylvania with among the nation’s lowest ratings. Democratic Gov. Tom Wolf says the move “is an urgent call to action” for a long-term budget solution.
Republican legislative leaders are considering borrowing money and expanding casino-style gambling to help balance the budget.