Fitch: New York's New Law May Weaken Local Government Credits

McDonald, Michael
September 2004
Bond Buyer;9/14/2004, Vol. 349 Issue 31968, p28
Trade Publication
This article focuses on the new pension system reforms that New York Governor George Pataki signed into law in July 2004. According to Fitch Rating Inc., this reform could prove to weaken local government credits in the municipal market. It is also forecasted that some local governments could widen their structural budget deficits depending on how they fund the annual pension payment that was originally due this December 15 but was changed to February 1, 2005, under the reform. These reforms changed the payment date of the pension contribution local governments make into the state-run system for employees, permitted amortization of some of the costs of contributions for the next three years and authorized establishing pension reserve funds.


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