WASHINGTON - Many state and local governments face their most serious fiscal challenges in decades with declining revenue, difficultly accessing the municipal bond market, and strained liquidity causing uncertainties and threatening their credit ratings, Moody's Investors Service warned in a report issued late last week.

"The duration and severity of the economic downturn is the primary uncertainty facing state and local governments," Moody's said in the report titled "Credit Uncertainties: Public Sector 2009."

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.