After meeting with the nation’s bond rating agencies in New York, Gov. Phil Bredesen expressed “high hopes” Tuesday that Tennessee will maintain its credit worthiness.
The state government now enjoys a AA-plus rating, roughly one step below the highest score, and the state is preparing to sell bonds to finance new bridges and economic development projects for Chattanooga’s new Volkswagen plant. The ratings are critical to state governments, adding or subtracting millions of dollars to the cost of a bond sale.
“We have high hopes,” said Bredesen after meeting with Fitch and Standard & Poor’s, and Moody’s rating agencies. “Obviously, we’re going through these tough times right now. … I’ve certainly asked them to restore us to AAA as I have done at previous times. But I think basically, if they’ll come out with a strong AA-plus that we have, it’ll work well for us.”
Like every state, Tennessee has been hit hard by this economy, losing $1 billion in revenue. But Bredesen said the rating agencies were impressed by his administration’s two-year plan to spend Tennessee’s share of the federal economic stimulus money.
“I’d say on the whole Tennessee is riding pretty good with them right now,” the governor said during a teleconference with reporters. “We’ve managed our way through this downturn and we seem to be taking care of business and keeping our focus where it needs to be. We think it went very successfully and we’re certainly hoping for a good result.”
He said the agencies should announce Tennessee’s new bond ratings by the middle of next month.