July 23 (Bloomberg) -- New York’s credit rating was raised to AA+ from AA by Standard & Poor’s, which cited strong fiscal management after Governor Andrew Cuomo won his fourth consecutive on-time budget.
The increase to the second-highest investment grade means New York has its highest S&P rating since 1972, when Nelson Rockefeller was governor. Moody’s Investors Service last month upgraded the state to the second-best rank, Aa1, and Fitch Ratings elevated it to AA+ in April.
The change reflects the state’s “recent history of improved structural budget balance with a strong focus on spending restraint and on-time budgets,” S&P analyst David Hitchcock wrote in a report released today.
Cuomo, a 56-year-old Democrat running for re-election in November, has closed more than $10 billion in projected budget gaps since taking office in 2011. At the same time, he’s kept spending growth limited to 2 percent annually, which last fiscal year helped produce the first surplus since 2008.
“The budget process has gone from a three-ring circus to a sensible blueprint for growth,” Cuomo said in a statement. Investors in the $3.7 trillion municipal bond market already have been treating New York like a top-rated state.
The most-traded New York general-obligation debt today is a portion maturing in February 2016, according to data compiled by Bloomberg. The securities changed hands at a yield 0.03 percentage point less than benchmark munis, the narrowest spread since October, the data show.
To contact the reporter on this story: Brian Chappatta in New York at firstname.lastname@example.org
To contact the editors responsible for this story: Stephen Merelman at email@example.com Mark Tannenbaum