The City of St. Louis' credit rating was downgraded by Moody's Investor Service for the third year in a row.
The credit rating is determined by how much debt a city has acquired and how much money the city has in their reserve to pay off that debt to allow the city to keep growing.
St. Louis Board of Alderman President Lewis Reed responded to the credit rating downgrade saying:"The primary reason why Moody downgraded our credit rating was due to the dangerously low amount in our reserve fund. They also downgraded our rating because of our dependence on economically sensitive revenue streams. Until we can grow our overall revenue and increase our reserves, we should expect to see a decline in our credit rating."Reed says the City of St. Louis has $1.7 billion in debt right now, which comes from several sources, not just one particular project or agreement.
In his statement, Reed noted three solutions to improving the city's credit rating for the 2019 fiscal year. First, he says the city adopted a policy to pull 1.5 percent from salaries into reserve funding. Second, to put the money from the sale of the Municipal Court Building into reserve funding. Third, Reed says he has introduced a bill to direct the St. Louis Development Corporation to complete an annual City Economic Growth Strategy Report.
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