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Thu June 11, 2009
S&P gives Mich. AA- rating on managing budget gap
LANSING, MI – Standard & Poor's Rating Services says Michigan deserves an AA- long-term rating on its general obligation bonds for its strong budget management.
In issuing the low-risk investment rating on Wednesday, S&P said the state has been conservative in its revenue estimates and has a low debt and pension burden.
It says federal recovery money should help the state weather further economic downturns caused by the bankruptcies of General Motors Corp. and Chrysler LLC.
The report warned, however, that delaying difficult budget decisions "would contrast with past discipline and ... be cause for concern."
Michigan recently cut more than $300 million from its current budget and faces an even larger shortfall in the fiscal year that starts Oct. 1.