MINNEAPOLIS (AP) -- Minneapolis has been dealt a credit-rating setback.
Moody's Investor Service said Monday it was knocking the city's credit rating down a notch. It means the city is likely to face higher interest rates when it borrows for construction projects.
The Star Tribune reported Tuesday that the downgrade was based on declining property values, high pension liabilities, sizeable fixed costs, dependence on state revenue and above average debt levels.
The city did earn a "stable" outlook based on expectations of a strengthening tax base and other considerations.
Minneapolis Mayor R.T. Rybak had touted his city's return to a top credit rating a few years ago. Rybak is stepping down after his third term ends.
The city's chief financial officer questioned Moody's methodology and called the downgrade "an overreaction."
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