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    Councilmember Jack Evans expressed concern over a Standard & Poor's credit report warning that the District's bond rating is in jeopardy due to using reserves to offset revenue shortfalls and the risk involved with acquiring United Medical Center. The report serves as a wake up call and Evans said the Mayor and Council must identify $400 million in expenditure reductions to balance the FY2012 budget and prevent a lowering of the bond rating, as growth in expenditures like social services and education have increased costs substantially.

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    Councilmember Jack Evans expressed concern over a Standard & Poor's credit report warning that the District's bond rating is in jeopardy due to using reserves to offset revenue shortfalls and the risk involved with acquiring United Medical Center. The report serves as a wake up call and Evans said the Mayor and Council must identify $400 million in expenditure reductions to balance the FY2012 budget and prevent a lowering of the bond rating, as growth in expenditures like social services and education have increased costs substantially.

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    264 views1 page

    S & P Report

    Uploaded by

    jevans6128
    Councilmember Jack Evans expressed concern over a Standard & Poor's credit report warning that the District's bond rating is in jeopardy due to using reserves to offset revenue shortfalls and the risk involved with acquiring United Medical Center. The report serves as a wake up call and Evans said the Mayor and Council must identify $400 million in expenditure reductions to balance the FY2012 budget and prevent a lowering of the bond rating, as growth in expenditures like social services and education have increased costs substantially.

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    PRESS RELEASE

    Council of the District of Columbia


    Office of Councilmember Jack Evans
    The John A. Wilson Building, 1350 Pennsylvania Avenue, NW, Washington, DC 20004
    ________________________________________________________________________
    For Immediate Release: January 7, 2011

    CONTACT: Andrew Huff, Director of Communications [202-724-8058]

    Evans Expresses Concern over Standard & Poor’s Credit Report


    Bond Rating Agency Warns District over General Fund Balance

    Washington, DC – Councilmember Jack Evans today expressed deep concern over the
    recently released Standard and Poor’s credit report on the District’s General Obligation
    (GO) bonds.

    In the report, Standard and Poor’s warns that the District’s GO bond rating is in jeopardy
    due to “a trend of using reserves to offset revenue shortfalls.” The report also notes the
    risk involved with the District’s acquisition of United Medical Center and how it may have a
    negative impact on the city’s bond rating as well.

    “What we have heard from Standard and Poor’s should serve as a wake-up call for every
    Councilmember,” said Evans. “We are in the midst of a very precarious situation and we
    cannot continue to rely on our fund balance to balance the budget.”

    “All of the bond rating agencies, including Standard and Poor’s, look very skeptically upon
    tax increases and recognize them for what they are – unsustainable, one-time fixes,” Evans
    said. “Mayor Gray and the Council must immediately identify $400 million in expenditure
    reductions in order to balance the FY 2012 budget. City-wide expenditures have grown
    65% or almost $3 billion in the last 8 years, with the majority of growth in social service
    programs (81%), education (55%), and debt service (121%). Reducing that growth is
    essential to maintaining our A+ bond rating.”

    Evans voted against the FY 2011 budget, his first ‘no’ vote in two decades of service on the
    Council, due to its reliance on dipping into the District’s savings account and the raising of
    taxes and fees to balance the budget.

    “I will not be a part of any action that results in the lowering of our bond rating,” said
    Evans.

    ###

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