Fitch upgrades Wayne County’s bond rating
Another credit-rating agency has given Wayne County some more good news about its finances.
Fitch Ratings Inc. Tuesday said it has upgraded the county’s bond rating from “B” to “BB+,” skipping over four other designations.
Fitch’s upgrade comes only a couple of weeks after another credit-rating agency, Standard & Poor’s, said it upgraded the county’s financial outlook from “negative” to “positive,” bypassing its intermediary “stable” designation.
Fitch attributed its new Wayne County bond rating to the progress it has made toward eliminating its financial distress and realigning its long-term liabilities.
“The disciplined implementation of our recovery plan has turned the county’s finances around and put us on a path to fiscal stability,” County Executive Warren Evans said in a statement. “Although there is still a lot of work to be done before the County’s finances are completely stabilized, the Fitch upgrade of our credit rating is confirmation that we are on the right track.”
County officials also said Fitch’s upgraded rating is expected to make it possible for the county to borrow the money necessary to complete work at the county jail site on Gratiot in Detroit’s Greektown and at a lower interest rate.
In January 2015, the county faced a $52 million annual deficit stemming from an underfunded pension system and a $100 million drop in property tax revenue since 2008. In addition, the county was pulling about $20 million from its general fund each year to bolster its pension system.
Evans asked the state to declare a financial emergency and intervene to help fix the finances of Michigan’s most populous county. In August, the county entered into a consent agreement with the state.
After a series of cost-cutting measures, the county closed its last fiscal year with a positive general fund balance for the first time in eight years.