Moody's Investors Service downgraded Monroe County, N.Y.'s general obligation rating to Baa1 from A3 and changed the county's outlook to negative, affecting $455 million in debt.

"We are pretty disappointed in the decision," Monroe County chief financial officer Robert Franklin said. "Wall Street and Moody's want us to raise taxes to have a nice healthy fund balance. Our county executive is dedicated to the interests of our tax payers and not to Wall Street."

On June 18 New York Comptroller Thomas DiNapoli issued a report on 901 community governments which named Monroe County as the most fiscally distressed New York community government on the list.

In a report Tuesday, Moody's associate analyst Shannon McCue and vice president Geordie Thompson pointed to the budget's lack of structural balance and dependence on one-time revenues. They also noted the county's weak financial reserves and pressures from state mandates. Finally, the county operates a nursing home that requires county financial support.

On the plus side, Monroe has favorable unemployment rates and average wealth levels, the analysts wrote. It also has moderate debt and unfunded pension levels.

Moody's has a negative outlook on the bonds because the county will be challenged to restore a structurally balanced budget, the analysts wrote.

Fitch Ratings rates the bonds A-minus with a stable outlook.

Monroe County's seat is Rochester. It has about 745,000 residents.

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