NEW YORK--(BUSINESS WIRE)--On March 27, 2018, the City of Hartford and the State of Connecticut entered into a contract assistance agreement under which the State agreed to pay the debt service on the City’s general obligation debt from its general resources. Though KBRA recognizes that the State’s debt levels are high, KBRA does not view the assumption of the City’s general obligation debt as significantly increasing the State’s debt burden. In KBRA’s view, the State’s decision to establish a mechanism to assist its fiscally distressed municipalities is an indication of the strength of the management structure of the State. KBRA views the State’s process as a strong model for state fiscal intervention in that the structure requires regular reporting by the municipality and provides a clear path for increased state control, including takeover of the municipality’s finances, if necessary. KBRA views the commitment to financial oversight and assistance for municipalities in distress as an important aspect of a state’s role in regard to its constituent local governments.
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KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.