West Virginia’s economy remains healthy despite the downturn in the national economy, but the state’s long-term liabilities remain significant, Standard & Poor’s said Tuesday in a review of the state’s credit rating.
Factors supporting the state’s AA-minus general obligation rating and stable outlook include solid financial management, demonstrated willingness and ability to tackle large-scale financial challenges, and moderate debt burden.
Standard & Poor’s also cited an economic base with limited depth and diversity, and long-term liabilities associated with an underfunded teachers’ retirement pension system.
“The state’s credit improvement will depend on the substantial deepening and diversification of its economic base, resulting in improved income levels,” analyst John Sugden said in a release. “The continued management of pension and other fixed-obligation funding in a manner that neither challenges financial integrity nor budgetary flexibility and ensures structurally balanced budgets over forecast horizons is also necessary.”