June 20 (Reuters) - Fitch Ratings upgraded the state of New York’s general obligation (GO) bond rating to ‘AA+’ from ‘AA’, citing improved fiscal management practices by the state in recent years.
The ratings change comes a few months after New York passed its fourth consecutive on-time state budget, something that had not happened for nearly four decades.
The ratings agency said it expects that the state will continue to adhere to strengthened fiscal management practices.
“The upgrade reflects the improved fiscal management practices of recent years that have resulted in timely and more sustainable budget-making. Notable recurring actions were taken to close budget gaps in the downturn, and in the recovery the state has limited the growth in spending,” Fitch said.
Under Governor Andrew Cuomo, New York has been shedding its reputation of fiscal dysfunction. Since 1978, the state budget had arrived an average of 36 days late, and in some years, budgetary debates run into July and even August, according to the state’s budget office.
Fitch noted that while New York’s debt burden is above average, it is still in the moderate range, with a modest decline in recent years. (Reporting by Tanvi Mehta in Bangalore and Robin Respaut in New York; editing by G Crosse)