Gov. Jay Nixon today joined business leaders from the Civic Council of Greater Kansas City at Commerce Bank to discuss findings published last week by the three leading independent credit rating agencies, Standard & Poor's, Fitch and Moody's, regarding the potential impact of House Bill 253 on Missouri's credit rating. The agencies' reports show the potential for serious risks to Missouri's fiscal health and the state's long-standing AAA credit rating if the Governor's veto is overridden and House Bill 253 becomes law. The Governor shared his concerns with members of the Missouri House and Senate in a letter this morning.
"Since 1989, Missouri has maintained the highest AAA rating from all three of the leading independent credit rating agencies. This spotless AAA credit rating is a key selling point for Missouri as a location for investment and expansion, demonstrating to businesses and investors around the world that Missouri has a stable, predictable business climate and is a safe place to invest and grow," Gov. Nixon wrote. "That is why the findings issued by the rating agencies last week in connection with the previously scheduled refinancing of State appropriation-backed bonds are so troubling. These findings mark a significant departure from the positive view of Missouri's fiscal stability previously offered by the rating agencies and provide further evidence that House Bill 253 could imperil our long-standing AAA credit rating if it were to become law."
"We believe that recent legislation, known as House Bill 253, could potentially have a significantly negative impact on the state's finances under certain circumstances," Standard & Poor's wrote in its July 24 report. "We believe that if the Missouri legislature overrides the governor's veto and enacts the legislation, and the federal government passes the Marketplace Fairness Act, it has the potential to result in a significant financial impact to the state, despite requirements for the maintenance of a balanced budget."
In its July 18, 2013 report, Fitch Ratings specifically noted that House Bill 253 would be taken into account in evaluating Missouri's credit rating if the Governor's veto was overridden. Moody's acknowledged the Governor's action in restricting $400 million to ensure a balanced budget in the event that House Bill 253 became law.