A Wall Street company has cut New Jersey’s bond rating.
Citing the state’s underfunded pension and employee benefits liabilities, Fitch Ratings has downgraded New Jersey’s general obligation bonds and the state’s open-space preservation bonds.
Fitch’s action brings its rating in line with those adopted by Standard and Poor’s and Moody’s earlier this year, said New Jersey Treasury Department spokesman Bill Quinn.
“New Jersey is struggling like nearly every other state to rebound from the worst economic downturn since the Great Depression,” Quinn said. “It’s also hampered by past administrations’ mismanagement of state finances, which left the state with a weaker economy than its neighbors, huge debts, and billions of dollars of underfunding in the pension plans and for future retiree medical benefits.”
Treasury officials expect New Jersey’s finances and its credit ratings will stabilize as the state continues to manage its assets. So far, they have not seen an increase in borrowing costs because of the ratings cut.