New Castle County’s leader warns of the impact a US government default could have on the county’s finances.
Moody’s announced Friday that New Castle County is among 162 local governments in 31 states that will face a bond rating review if the federal government defaults. “It is disheartening to learn that our bond rating is in jeopardy due to the stalemate in Washington,” says New Castle County Executive Paul Clark. “New Castle County has maintained a AAA bond rating by being fiscally responsible and achieving balanced budgets through shared sacrifices made by our workforce, departments and citizens.”
Clark says if the county’s bond rating gets downgraded, the county would face higher interest rates on future bond sales. He says it could also delay or increase the cost of future construction projects like libraries or sewer rehabilitation projects.
Former New Castle County Executive and now US Senator Chris Coons (D) blames Tea Party Republicans for the impasse. “We’ve been hearing for weeks about how Tea Party Republicans’ inability to accept responsibility for fulfilling the nation’s obligations would trickle down and impact municipalities’ own AAA bond ratings. This morning we woke up to find that nightmare is coming true,” said Coons.
Coons, who defeated Tea Party favorite Christine O’Donnell in last November’s US Senate race, says “It’s disheartening to think that years of extremely difficult work at New Castle County maintaining our AAA bond rating could be tossed aside by weeks of reckless stubbornness by Tea Party Republicans. While we have record annual deficits and a dangerous national debt that need to be urgently addressed, defaulting on America’s mortgage is not the way to do it.”