Fitch Ratings, one if the Big Three bond rating firms, today lowered San Antonios rating from AAA, the highest, to AA Plus. Its the first time in nine years that San Antonio has not had a AAA bond rating, and for much of that time, San Antonio was the only city of over a million with the top rating from all three agencies, a distinction that is now lost, News Radio 1200 WOAI reports.
City Officials said the downgrade was the direct result of the approval if Propositions B and C in last months charter election.
City Manager Sheryl Sculley says city officials had been warned that passage of the firefighter union sponsored measures would add uncertainly to the citys financial forecast.
Fitch specifically cited Proposition C, which gives an independent arbitrator, who has no knowledge of the Citys financial situation or its obligations, the power to dictate terms of the fire union contract.
Bond ratings reflect the citys ability to promptly and fully repay debts. A lower bond rating indicates greater risk, and, as with any debt instrument, the greater the risk, the greater the interest the lender will require.
That means San Antonio taxpayers will have to put more cash into the pockets of bankers, and will have less for parks, streets, public safety, and other city services.