Moody’s Ratings has downgraded Baltimore’s credit rating, citing years of declining reserves across city government as Baltimore prepares to ask voters to authorize another $280 million in borrowing this fall.
The downgrade does not mean Moody’s believes Baltimore cannot pay its debts. But it represents a warning about the city’s shrinking financial cushion at a time when officials plan to borrow more money for schools, roads, housing and other infrastructure.
“The downgrade of the city and related ratings reflects the trend of declining fund balance and cash levels across all government operations, largely concentrated in the utility and internal service funds,” Moody’s said in its statement on the downgrade. “Since the pandemic, the government-wide balance sheet has seen continued declines despite efforts and forecasts to stabilize reserves.”
