Moody's Cuts LA Credit Rating, Warns of More Downgrades

[Jeanfromfillmore]

Moody's Cuts LA Credit Rating, Warns of More Downgrades
he Los Angeles City Council and employee unions are investigating whether Mayor Antonio Villaraigosa has the authority to shut down municipal services two days a week.

The city's financial crisis led Moody's Investors Service to downgrade the city's credit rating and warn that the city risks further downgrades.

Moody’s cut L.A.’s general-obligation bond debt rating to Aa3 from Aa2. That puts the city at the lower end of what Moody’s considers a “high quality” security. A weaker credit grade typically means higher borrowing costs.

Moody’s said its ratings cut “primarily reflects the continued erosion of the city's historically better-than-average willingness and ability to quickly rebalance its budget mid-year.”

The downgrade also “partly reflects the likelihood that the city's general fund reserves at the end of the current fiscal year could be materially weaker than we had previously expected, now that an expected transfer from the Department of Water and Power may be reduced.”

Meanwhile, a spokesman for Councilman Bernard Parks says the council may have to approve the plan to curtail several services starting Monday. Services that don't generate revenue — such as libraries, parks and community centers — would be affected.
The mayor's office did not immediately respond to a request for comment.
The mayor announced his cutback plan Tuesday after a city controller report warned the city would run out of cash by May 5.
http://moneynews.com/StreetTalk/US-L...mo_code=9B7F-1

[Bri-M]

the mayor must be proud, where are all the illegals that he welcomed in 06? They will surely help him now (sarc)

[ilbegone]

Originally Posted by Bri-M

the mayor must be proud, where are all the illegals that he welcomed in 06? They will surely help him now (sarc)

This is in the vein of being carefull for what you wish for.

Aztlan, Villaraigosa's dream as a Mecha hell raiser in college has turned into the unpleasant reality he now presides over, maybe a little karma tossed his way for being a race obsessed a-hole.

In threatening to cut the working hours of his employees, something he has no direct authority to carry out, he has pissed off many of the very people who elected him to office. I don't believe he could be elected to dog catcher now.

We have a three way pissing match between Villaraigosa, the city council, and DWP. When everyone had money to spend spend spend, they all shared the same bed. Now that the empires are being threatened by decreasing revenue, increasingly ugly maneuvering for position has escalated from a cat fight into what might turn into an inter departmental street brawl with all the knives and maybe some political drive bys as well.

And there will be a lot of stray bullets fired into the constituency and city employees by the time it is over. Lots of collateral damage.

And the illegals will still be here when it's over.

More for the morbidly curious about three ring circuses and clowns with jalopies, firecrackers, rubber mallets and seltzer bottles:

DWP money sparks showdown in L.A. http://www.dailynews.com/search/ci_14840029