Really interesting read.
So what tools can cities use if they are broke AND are considered no worthy of having anyone loan them money? How do you get a tax base back, when the value of homes, business, etc. is plummeting? If you already aren't bringing in enough revenue, can you cut taxes in hopes of spurring development?Of the 7,800 bonds in the U.S. secured by state or local governments, only 25 are currently speculative-grade, or junk-bonds, rated by Moody’s Ba1 or lower. Only municipalities received such low ratings, and the reasons vary. Moody’s report, “A Look at Speculative-Grade Local Governments in the Wake of the Recession,” details the economic issues that have lead each into junk-bond territory. 24/7 Wall St. has analyzed the nine worst cities, whose credit rating is Ba2 and lower.