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Cambria County receives upgrade in credit rating

A leading credit rating service has upgraded Cambria County’s long-term debt rating as a result of budget management improvements made in 2016.

The revision by Standard & Poor’s Global Ratings moved Cambria County from a negative to a stable triple-B rating, said Cambria County Chief Clerk Michael Gelles.

That new rating, Gelles said, will make it easier for the county to borrow by issuing bonds and may lead to lower interest rates on that borrowing.

The county’s finances are periodically studied by S&P, and then a rating is issued, Gelles said.

“It’s kind of an independent review of the county’s financial status,” he said.

Previously, Cambria County’s rating was downgraded to negative.

The negative rating, if unchecked, could have meant a further downgrading, which would have made it more difficult or impossible to issue bonds, Gelles said.

The recent upgrade is a reflection of financial management changes that have “improved the county’s overall budgetary performance and reserves,” said Linda Yip, an S&P credit analyst, in a statement.

In a set of statements, the county’s commissioners elaborated on Yip’s comment.

“This board inherited an $8.6 million budget deficit, and we committed to make every day a budget day. We started by using realistic numbers to project our revenue. Most importantly, we stopped the practice of using fictitious grant dollars to balance the general fund of Cambria County,” President Commissioner Thomas Chernisky said.

Commissioner William “B.J.” Smith agreed, revealing that decisions were made to attack that deficit and to “centralize purchase controls.

Gelles said attacking the deficit included a tax increase, as well as closing the county’s juvenile detention center.

The deficit has been reduced to about $2.3 million, Gelles said. County Controller Ed Cernic Jr. said in a statement that he expects that deficit to continue to decrease.

“By the end of 2017, we will have erased the lingering deficit this board of commissioners inherited,” Cernic said. “The kick-the-can-down-the-road style of financial management is over.”

On Wednesday, Gelles said the new rating will have little effect on the upcoming 2018 county budget.

However, county officials likely will soon move to issue bonds for needed repairs at the local prison and Human Services Building, he said.

Mirror Staff Writer Sean Sauro is at 946-7535.

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