THE ASSOCIATED PRESS
Published: Oct. 9, 2012 Updated: Oct. 10, 2012 6:07 a.m.
SACRAMENTO – One of the nation’s top credit rating agencies announced Tuesday that it will review 30 California cities for possible downgrades amid mounting concern over municipal bankruptcies and bond defaults.
“California cities operate under more rigid revenue raising constraints than cities in many other parts of the country,” said Eric Hoffmann, who heads Moody’s California local government ratings team. “Combined with steeply rising costs, these constraints mean that these cities will likely recover more slowly than their peers nationally, even if the state’s economic recovery tracks the nation’s.”
Cities under review include Danville, Santa Monica, Sacramento and Fresno. Moody’s will examine an array of factors, including falling tax revenue and increased spending. The other cities that Moody’s has targeted for possible downgrades include Huntington Beach and Santa Ana.
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