Pike County lost its credit rating. Now it's 'nearly impossible' to borrow money.
In response to a scathing report from Kentucky's state auditor, the credit rating agency S&P Global withdrew its rating for the largest local government in Eastern Kentucky, making it "nearly impossible" for Pike County to borrow money.
The audit criticized the county's financial management practices and, in particular, its poor record-keeping processes and insufficient supervision of the county treasurer.
S&P's decision means it offers no assurances to buyers that the county will repay its $9.4 million in general obligation bonds. Though county officials said they have no plans to offer new bonds, not having a credit rating would make it difficult, or at least very expensive, to pursue new debt.
"At some point down the line, they will likely need to borrow money," said Sean Dennis, an assistant auditing professor at UK. "This makes it nearly impossible."
Read more: http://www.kentucky.com/news/state/article212809869.html
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