WASHINGTON Feb 21 Moody's Investors Service is
keeping its outlook negative for U.S. local governments in 2013,
as cities and counties must continue to operate with tight
revenues, high demand for spending, and an "uneven economic
recovery," the rating agency said on Thursday.
Those local governments with "elevated reliance on federal
employment or funding that is subject to federal budget cuts"
have an increased risk of rating downgrades as the U.S. Congress
wrestles over the federal debt and deficit.
In a little more than a week, automatic spending reductions
across most federal programs are set to take effect in a process
called sequestration, and the military is warning it will have
to furlough hundreds of civilian employees.