CHARLESTON, W.Va. - Fitch Ratings on Wednesday affirmed its high ratings on more than $900 million in state-backed bonds, saying the state's well-managed finances and ample reserves put West Virginia on good footing for paying back its debts.
The New York-based ratings agency said it is maintaining its 'AA ' rating on the state's $487.9 million general obligation bonds, and also kept its 'AA' rating on the $433.7 million in appropriation-backed bonds issued by the state Economic Development and School Building authorities.
Both ratings place the bonds in investment grade territory and are an indication of very high credit quality. According to Fitch's ratings scale, the rankings "indicate very strong capacity for payment of financial commitments" and are "not significantly vulnerable to foreseeable events."
In addition to the ratings, Fitch also said its ratings outlook for the state remains stable -- an indication that the ratings are not likely to change in the near future.
The ratings firm cited the state's well-managed financial operations, sizable reserves and manageable debt and pension liability position to support the high ratings.
While it noted that tax revenue suffered somewhat over the last fiscal year, the agency said Gov. Earl Ray Tomblin's efforts to enact 7.5 percent budget cuts at most agencies without tapping the state's Rainy Day Fund supported its ratings outlook.
"The state's focused and disciplined efforts to address its accumulated financial challenges have supported generally successful financial operations," the agency said in its ratings announcement.
"The governor's broad powers to cut spending aided the state in addressing the revenue shortfalls," the report said.
Tomblin lauded Fitch decision in a statement released Wednesday afternoon.
"This is a direct result of the hard work the State has put forth to keep our financial house in order," he said. "West Virginia's solid commitment to addressing its financial obligations, such as our retirement systems and other post-employment benefits (OPEB), shows rating agencies that we pay our bills and honor our debts."