Text-S&P-Fed budget deal may affect state, local credit

(The following statement was released by the rating agency.)

SAN FRANCISCO (Standard & Poor's) Aug. 18, 2011--The federal Budget Control
Act of 2011 (BCA) could have an effect on Standard & Poor's view of municipal
credit quality, according to a report, "State And Local Governments Face
Fiscal Challenges Under Federal Debt Deal," published today by Standard &
Poor's Ratings Services.

"In our opinion, the longer-term deficit reduction framework adopted as part
of the BCA could undermine the already fragile economic recovery and
complicate aspects of state and local government fiscal management," said
credit analyst Gabriel Petek. "Either of these outcomes could potentially
weaken our view of certain individual credit profiles of obligors across the
sector."

However, said Mr. Petek, "given the disparate nature of state and local
economies, differing levels of reliance on federal funding, and varying
management capabilities throughout the U.S., we anticipate the effects on
credit quality from the BCA will likely be felt unevenly across the sector."
The report is available to subscribers of RatingsDirect on the Global Credit
Portal at www.globalcreditportal.com. If you are not a RatingsDirect
subscriber, you may purchase a copy of the report by calling (1) 212-438-7280
or sending an e-mail to research_request@standardandpoors.com. Ratings
information can also be found on Standard & Poor's public Web site by using
the Ratings search box located in the left column at www.standardandpoors.com.
Members of the media may request a copy of this report by contacting the media
representative provided.
Primary Credit Analysts: Gabriel Petek, CFA, San Francisco (1) 415-371-5042;

gabriel_petek@standardandpoors.com

Steven J Murphy, New York (1) 212-438-2066;

steve_murphy@standardandpoors.com
Secondary Contacts: Robin Prunty, New York (1) 212-438-2081;

robin_prunty@standardandpoors.com

John Sugden-Castillo, New York (1) 212-438-1678;

john_sugden@standardandpoors.com
Media Contact: Olayinka Fadahunsi, New York (1) 212-438-5095;

olayinka_fadahunsi@standardandpoors.com
(New York Ratings team)
(email: Harold.Barnett@thomsonreuters.com;
Reuters messaging: harold.barnett.thomsonreuters.net; Tel: +1-646-223-4186))