Moody’s Investor Services’ general obligation limited tax (GOLT) debt outlook for Wayne County is now stable according to a Credit Opinion issued Feb. 19,
reversing a previously negative rating.
The New York rating agency’s report identified several factors for granting Michigan’s largest county a more favorable outlook, including:
“…Wayne County significantly reduced expenses over the past six months, positioning itself for financial stabilization…”
“…Significant expenditure reductions through modification of retirement benefits, contraction of payroll and other operating efficiencies that correct a long-standing operational imbalance…”
“…Enhanced control over expenditures was key to addressing the county’s fiscal concerns given limited options to raise revenue…”
“…Along with other operating adjustments, including consolidation of facilities, renegotiation of service contracts, and reduction in personnel, county officials estimate a reduction in general fund costs of nearly $50 million for the current fiscal 2016 that began on October 1, 2015…”
“…Actuarial estimates peg annual savings associated with retiree healthcare reforms at nearly $20 million. The county estimates another $13 million of annual savings associated with pension reforms… that include a reduction in the benefit multiplier for future years of service and increased employee contributions. More than half of the annual savings will hit the county’s general fund…”
“Moody’s decision to upgrade our credit outlook to stable is a step in the right direction,” said County Executive Evans. “Our successes last year in eliminating the structural deficit and reducing unfunded health care liabilities were definitely noteworthy, but, we aren’t resting on those successes. My administration continues to work to restore long term fiscal stability to Wayne County.”
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