PROVIDENCE, R.I. (AP) — A Wall Street ratings agency is lowering its outlook on Rhode Island’s capital city.
Moody’s Investor Service cut Providence’s credit rating to negative after the city reported a $5 million shortfall in the budget year that ended June 30, WPRI-TV reports.
Providence’s rating with Moody’s has dropped from A1 in 2011 to Baa1 currently. Moody’s most recent decision affirms the Baa1 rating but cuts the outlook to negative.
In its analysis, the agency noted Providence continues to have “very weak” financial reserves and rising pension and health care costs will only put more pressure on city finances.
Providence’s financial struggles came to light when then-Mayor Angel Taveras warned of “a category-five financial hurricane” soon after taking office in 2011. His predecessor was David Cicilline, now a Democratic congressman.
