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Standard & Poor's downgrades Los Angeles' credit rating
A view of City Hall in downtown Los Angeles, Calif.
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Standard & Poor's downgrades Los Angeles' credit rating
Standard & Poor's downgrades Los Angeles' credit rating
In a move that will likely cost the city of Los Angeles millions of dollars, Standard & Poors downgraded the city's credit rating to AA-.
The downgrade by Standard & Poors comes as the city faces plummeting tax revenues and a nearly $700 million deficit.
City Administrative Officer Miguel Santana said it means L.A. will pay millions more to borrow money — which it must regularly do to maintain cash flow.
The downgrade follows a decision by Moody’s Investors Service to place the city on a negative credit watch list.
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“To have yet another agency give a negative rating to our actions — people should feel more pressure," Councilwoman Jan Perry said.
The city council already has approved a plan to eliminate 4,000 city jobs.
Santana said ratings agencies want see that the plan "actually reaches fruition and is completed."
Mayor Antonio Villaraigosa has said the only way to avoid layoffs is for all city workers to accept across the board pay cuts.
Standard & Poors downgraded L.A.’s credit rating from AA to AA-.
It also downgraded the Municipal Improvement Corporation of Los Angeles — which the city also uses to borrow money — from AA to A+.
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But the game has changed: Congress voted to eliminate funding for public media across the country. Here at LAist that means a loss of $1.7 million in our budget every year. We want to assure you that despite growing threats to free press and free speech, LAist will remain a voice you know and trust. Speaking frankly, the amount of reader support we receive will help determine how strong of a newsroom we are going forward to cover the important news in our community.
We’re asking you to stand up for independent reporting that will not be silenced. With more individuals like you supporting this public service, we can continue to provide essential coverage for Southern Californians that you can’t find anywhere else. Become a monthly member today to help sustain this mission.
Thank you for your generous support and belief in the value of independent news.
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