Pa. braces for credit downgrade after budget and pensions soufflé - Mary Wilson, Newsworks

This spring, the three big credit-rating agencies gave Pennsylvania fair warning to reduce its $50-billion-and-growing pension debt, rein in long-term pension costs, and stop using one-time moves to balance the budget. But all those problems remain, even after the frenzy of legislative activity that marks every June at the state Capitol. The budget approved by the House and Senate does make the full scheduled payments toward the pension debt, but those payments are already lower than actuaries suggest. Lawmakers failed to find political support for efforts to scale back public pension benefits for future state and school employees. Add to all that the bevy of one-time funding sources used in the budget to cover a $1.4 billion deficit. The rating agencies' warnings went unheeded. http://www.newsworks.org/index.php/local/item/70026-pa-braces-for-credit-downgrade-after-budget-and-pensions-souffle