Moody’s knocks Mpls. credit rating down a notch

MINNEAPOLIS (AP) — Minneapolis has been dealt a credit-rating setback.

Moody’s Investor Service said Monday it was knocking the city’s credit rating down a notch. It means the city is likely to face higher interest rates when it borrows for construction projects.

The Star Tribune (http://bit.ly/15tagmO ) reported Tuesday that the downgrade was based on declining property values, high pension liabilities, sizeable fixed costs, dependence on state revenue and above average debt levels.

The city did earn a “stable” outlook based on expectations of a strengthening tax base and other considerations.

Minneapolis Mayor R.T. Rybak had touted his city’s return to a top credit rating a few years ago. Rybak is stepping down after his third term ends.

The city’s chief financial officer questioned Moody’s methodology and called the downgrade “an overreaction.”

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Information from: Star Tribune, http://www.startribune.com

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