BATON ROUGE, La. (AP) – Louisiana’s credit has taken a hit, with a national rating agency downgrading the state. That makes it more expensive to borrow money for roadwork and construction projects.
S&P Global Ratings announced Wednesday it dropped Louisiana’s rating one notch. That’s the third national rating agency to downgrade the state’s credit since February 2016, as Louisiana continues to struggle with financial gaps.
In its analysis, S&P declared Louisiana’s financial outlook “negative.”
The rating agency cited weak tax collections, declines in the oil and gas industry and use of patchwork fixes to fill recent deficits. The agency notes that $1.5 billion in temporary taxes and revenue expires in mid-2018, creating further uncertainty.
Gov. John Bel Edwards says the downgrade shows the need for “structural tax and budget reform” in the upcoming legislative session.