March 17, 2002

The State of Michigan continues to get straight A’s from Wall Street. Standard and Poor’s and Moody’s Investors Service today cited Michigan’s effective financial management, economic diversification and low debt burden in re-affirming the state’s AAA credit rating. According to State Treasurer Jay B. Rising, S & P’s announcement shows continuing confidence in Michigan’s financial future. "At a time when some states are experiencing downgrades on Wall Street, this is proof Michigan is on the right track," Treasurer Rising says. "These reports clearly acknowledge the state’s effective financial management and the sound fiscal strategies now in place."

Standard and Poor’s reacted positively to Governor Jennifer Granholm’s Fiscal Year 2004 budget recommendation. Today’s report calls the proposal a ‘credible plan’ based on ‘reasonable assumptions’. Moody’s cited the Governor’s ‘significant proposed spending reductions’ in achieving structural balance in the proposal for 2004. Treasurer Rising says, addressing the structural deficit is a key factor in retaining Michigan’s AAA rating. "It is imperative that we continue to take a pro-active approach in addressing Michigan’s current economic realities. We cannot simply sit back and wait for things to get better."

Michigan is currently the largest state to hold a AAA bond rating and the only manufacturing state to carry that distinction.

According to S & P’s, Michigan continues to face challenges from the recent economic downturn and a Budget Stabilization Fund that has been depleted over the last two years. As a result, the agency revised Michigan’s outlook to negative. Moody’s report affirmed its negative outlook for Michigan.