ALBANY -In a sign of the state’s financial troubles, Moody’s Investors Service yesterday lowered its bond-rating outlook for the state to “stable” from “positive.”
“It is clear now that the financial challenges facing the state are pronounced,” Moody’s analyst Robert Kurtter wrote.
The analysis cites increasing Medicaid costs, a “volatile” financial-services industry, and spending pressures for school aid, health care and pensions as serious warning signs of trouble ahead.
The move by Moody’s came as a Medicaid relief plan being pushed by a top upstate ally to Gov. Pataki would help every county in the state -but exclude New York City.
Erie County Executive Joel Giambra is proposing that the state take over the 25 percent local share of Medicaid for the 57 counties outside the city and pay for it with a 1 percent hike in the 4 percent state sales tax.
Bloomberg spokesman Joe Cunningham said: “All local governments should be part of the solution, and to exempt New York City doesn’t make much sense.”