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Westchester County Loses AAA Rank After Drawing Down Cash

  • County used reserves to pay retroactive salary increases
  • S&P cuts Westechester rating to AA+ and it could go lower
Yonkers, Westchester County, New York

Photographer: DenisTangneyJr/iStockphoto via Getty Images

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New York’s Westchester County, home to the wealthy suburbs of Scarsdale and Bronxville, lost its AAA grade from S&P Global Ratings and Fitch Ratings after drawing down its cash reserves to cover retroactive raises given to government employees.

The county, which borders New York City to the north, had its grade cut one level by both companies Tuesday to AA+. S&P said there’s a one-in-three chance that it will downgrade the county’s bonds again in the next two years as the government contends with budget shortfalls, given how "narrow" its reserves were at the end of the 2017 fiscal year.