HAMILTON COUNTY, OH (FOX19) - Hamilton County Commissioners are lashing out at each other after Moody's Investors Service downgrade the county's rating.
The Moody's downgraded is due to in part because of the county's ongoing difficulties to pay off the stadiums because they did not get as much money from sales taxes as originally expected. The downgrade will make it harder to get a loan and the interest rate will increase.
"The credit rating is also more important than just the cost of capital. Forget what we pay for the interest, can we actually get the financing in the first place," said Christian Sigman.
"What I am doing is acknowledging a very practical fact which is we can only pay for things that we have the money to pay for," said Todd Portune.
"Piling on additional debt and refinancing right now is a big challenge right now to pay these bills. I don't think it's a realistic option for us to borrow the money to pay for the operations on an annual basis. We would certainly attract Moody's attention if that were the majority of the board's focus," said Greg Hartmann
Voters in Hamilton County voted to increase the sales tax from 5.5 to 6.5 percent in 1996. Back then, no one had any way of knowing the economy would run into a severe recession before the stadiums were paid off. In the 1970's, 80's and 90's, money collected from sales tax increased an average of almost 7.5 percent a year. From 2000 to 2007, it was stagnant then in 2008, it went down in 2009. In the last two years it started going back up but not to its original projections.
Commissioners now have to decide what to do. The county did sell off Drake Hospital which generated $15 million, but Moody's said that was just like putting a band aid on the problem and it doesn't fix it. The sale did lower the county's deficit this year to $13 million but it goes back up to $30 million next year if something else is not done.