S & P global ratings downgraded Wyoming’s credit rating from Triple-A to a Double-A-Plus. That means the next time Wyoming tries to borrow money, it will likely see a higher interest rate.
It’s like applying for a mortgage — if you have a high credit rating, you’ll pay lower interest rates. As Wyoming faces a downgrade in its credit rating, the same idea applies.
This is because there’s less money coming into the government’s coffers due to and low contributions to retirement funds.
Paul Fleming, with Wyoming’s Treasury Department, said the downgrade isn’t good, but it’s not really a cause for concern.
He said, “Unless we’re going out to borrow more money, then that would impact our interest rate so since we’re not borrowing right now, it doesn’t make a meaningful impact into our finances.”
One method to jump back to a Triple-A rating would be a surge in energy prices. Fleming said there’s no way to plan around that, “If you could tell me where the price of oil and natural gas and coal are going, we’d know pretty well, on pretty good certain terms."
Other methods to return to a higher rating include budget cuts or finding a new source of revenue.