Credit Sunshine Connelly via Wikimedia Commons
The nation’s bond rating agencies want to know how well Tennessee can ride out changes to the federal budget. The potential Congressional cuts knows as “sequestration” loomed over meetings with the agencies this week.
Every year, a delegation of top state officials makes the trip to New York to convince financial experts that Tennessee deserves a high credit rating. This time, Governor Bill Haslam went in armed with figures he says show the state has a growing economy and strong tax revenues.
“If the question is what’s your capacity to repay your debt, I’d stack us up against anybody.”
But again and again, he says the big question asked in those meetings was how well the state could handle federal budget cuts. Finance Commissioner Mark Emkes answered that what’s on the table now would really only affect two programs in Tennessee: special education and Title I funding for schools.
“Probably around the 20, 40 million dollar mark. So at this stage in the game, what we know, it’s very manageable.”
That figure doesn’t include federal investments that bypass state government, like research grants or military spending. Those are harder for officials to quanitfy, but still have ripple effects on the state’s economy.
Currently, Tennessee has a top rating of triple-A from two of the three bond rating agencies. There’s room for improvement from Standard and Poor’s, which has Tennessee down as a double-A plus.
On Air - 90.3 WPLN-FM