10 Years Later, Is Pittsburgh Really Climbing Out Of The Red?

A map of Pittsburgh, Pennsylvania with its neighborhoods labeled. For use primarily in the list of Pittsburgh neighborhoods. (Photo credit: Wikipedia)

Ten years and four months ago, then-Mayor Tom Murphy stood before a cadre of media to deliver grim news.

By the time he stepped up to speak, eyes moistened with tears, Pittsburgh city government had been sputtering along like an airplane held together by duct tape, according to a former finance director. But now the plane was about to take a nose dive — with the possibility of bankruptcy hovering.

“I hate doing this,” Mr. Murphy told the reporters.

He announced plans to lay off 731 city workers — including police officers — and leave hundreds more positions unfilled. All but six city pools would be drained and closed early — along with 19 recreation centers that were, in many places, critical gathering spots for sports and community events. Later that year, the city’s credit rating would be downgraded, making it the only major American city whose debt was rated “junk.” A fifth of the city’s budget went to pay off old debt.

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Standard & Poor’s Increases Pittsburgh’s Credit Rating To A

A map of Pittsburgh, Pennsylvania with its neighborhoods labeled. For use primarily in the list of Pittsburgh neighborhoods. (Photo credit: Wikipedia)

The credit rating agency Standard & Poor’s has bumped up Pittsburgh’s credit rating three notches to A, a move that could save the city money on future borrowing by improving the city’s credit profile.

The agency cited a number of factors in moving the city’s credit rating up from BBB.  First, it said the city’s resilient economy and “deep and diverse economic base” which allowed the city to fare relatively well during the economic downturn.  It also cited the presence of two state-appointed oversight boards that have kept close tabs on the city’s budget since the state of Pennsylvania declared it financially distressed nearly a decade ago.

S&P analyst Andrew Teras also cited the city’s debt management, increase in reserves and ability to manage long-term liabilities, like pensions.

Read more: http://www.post-gazette.com/stories/business/news/standard-poors-increases-pittsburghs-credit-rating-to-a-693510/#ixzz2XX5qOifp