Standard & Poor’s lowered its rating of Columbia County, Pa., by two notches to A-minus from A-plus, citing a drop in general fund balances to 2.4% of expenditures in fiscal 2011 from 14%.
“The lower rating reflects a significant decline in the general fund balance, which is now at nominal levels because of the county’s reliance on state and federal revenues that have been consistently under budget,” analyst Richard Marino said.
In addition, management is projecting another possible decline in fiscal 2012, though it would be less significant.
The 235,000-population county, whose seat is Carlisle, sits 90 miles north of Harrisburg.
Columbia operates a prison and provides youth services funded by state or the federal government. According to Standard & Poor’s, funds received from these agencies have either been delayed or are inconsistent with projections, straining finances.
Standard & Poor’s said the rating also reflects its view of a stable local economy with diverse tax base and strong market value per capita, and low carrying charges with no additional debt needs.