S&P Revises Kansas Rating Outlook to Negative on Budget Pressures
S&P Global Ratings revised the outlook on Kansas’ AA-minus credit rating to negative from stable on Wednesday, citing weak economic trends and structural budget pressures.
The credit rating agency faulted the state for its continuous use of one-time revenue measures to shore up operational spending. For the upcoming biennial budget, nonrecurring measures include a plan to sell bonds backed by Kansas’ share of a nationwide settlement with U.S. tobacco companies, liquidation of a capital reserve, and pension underfunding, S&P said.
“We believe the next two years will remain pressured and the proposed budget does not adequately provide solutions to Kansas’ ongoing structural deficits,” said S&P analyst Oladunni Ososami in a statement.