Bangkok--24 Aug--Standard & Poor's
According to a report released today by Standard & Poor's Ratings Services, Arizona enjoys a broad and diverse economy supported by a growing population. However, the slowing national economy and a painful housing downturn have financially pinched the state, which had previously enjoyed above-average growth in numerous categories including population, economy, and housing value.
Sales and income taxes, which boosted reserves during the economic boom earlier this decade, have since declined, putting pressure on budgets. The state's general fund, which had included surpluses that built reserves through fiscal 2006, posted a very modest fiscal 2007 deficit after transfers, and closed fiscal 2008 with a larger deficit despite midyear adjustments. In fiscal 2009, recent data on 12 months of revenues show that general fund tax revenues have fallen by the largest percentage in decades.
"The state's revenue streams have softened, leading to diminished financial flexibility," said Standard & Poor's credit analyst Matthew Reining. "Additionally, the state lacks a final, full fiscal 2010 budget, which is a break from the state's history of regular and timely budget action."
Still, Arizona continues to be one of the nation's fastest-growing states. We believe the state's rapid population growth provides some employment stability overall. Moreover, in our opinion, the state's long-term economic prospects are good due to its competitive position in the region.
The reports are available to RatingsDirect subscribers at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-9823 or sending an e-mail to [email protected]. Ratings information can also be found on Standard & Poor's public Web site at www.standardandpoors.com; under Ratings in the left navigation bar, select Find a Rating. Members of the media may request copies of these reports by contacting the media representative provided.
Media Contact:
Ana Sandoval, New York (1) 212-438-5095, [email protected]
Analyst Contacts:
Matthew Reining, San Francisco (1) 415-371-5044
Sussan Corson, New York (1) 212-438-2014
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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