Moody's Investors Service said it has downgraded to Baa3 from Baa2 the city of Poughkeepsie, N.Y.'s $49.6 million in outstanding rated debt.
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The outlook remains negative.
The downgrade to Baa3 reflects ongoing deterioration in the city's financial position, expected to remain negative in the near term, constrained liquidity and ongoing tax base declines.
The rating also reflects the city's below average wealth levels and above average debt burden.
The negative outlook reflects continued pressure facing the city's financial position after consecutive years of operating deficits, despite a small projected surplus in fiscal 2013. All of the affected debt is secured by the city's unlimited ad valorem property tax pledge.
