Maryland Suffers Financial Downgrade, Loses Coveted AAA Bond Rating
In another blow to Maryland’s economy, Moody’s, the credit rating agency, has downgraded the state’s bond rating.
“To hell with Moody’s,” said State Treasurer Dereck E. Davis during a Board of Public Works meeting following the credit downgrade. Davis indicated that Moody’s “was not the standard bearer they once were” and that the state could rely on a different credit rating agency.
A different credit rating agency, Fitch, affirmed Maryland’s AAA rating following the downgrade by Moody’s.
A lower bond rating means higher interest rates on loans, resulting in less funding available towards other state priorities. Maryland’s budget already has over $1.4 billion allocated to paying public debts.
“The downgrade was driven by economic and financial underperformance compared to AAA-rated states, which is expected to continue given the state’s heightened vulnerability to shifting federal policies and employment, and its elevated fixed costs,” Moody’s wrote in its report.
Prior to this downgrade, Maryland held the highest rating with all three of the major credit rating agencies and maintained these ratings through several recessions and the COVID-19 pandemic. Last year, Moody’s affirmed the existing AAA bond rating but gave a negative outlook.
Gov. Wes Moore (D), Lt. Gov. Aruna Miller (D), Comptroller Brooke Lierman (D), Treasurer Dereck E. Davis, Speaker Adrienne Jones (D- District 10), and Senate President Bill Ferguson (D- District 46) released a joint statement highlighting both the severity of the financial situation and the Trump Administration’s
“Over the last 100 days, the federal administration’s decisions have wreaked havoc on the entire region, including Maryland. Washington DC received a credit downgrade. Thousands of federal workers are losing their jobs,” the Maryland leaders explained.
Several state leaders who helped craft the budget, including Senator Guy Guzzone (D- Howard County), expressed that they did everything in their budgetary power to keep the state in a strong fiscal position.
Despite the challenge, the state officials assured residents of intentions to improve Maryland’s credit rating and finances overall.
“Maryland still holds one of the highest possible credit ratings in the nation,” they said, “and as we have for decades, we will always pay our debts.”
Local Leaders Respond to Nonprofit Grant Changes
Several local nonprofit organizations are celebrating, while others are lamenting losing funds, after the Prince George’s County Council decided to reallocate grant funding to support their needs, missions and goals.
The Capital Area Food Bank, A Wider Circle, American National Red Cross, and the Fairmount Heights Football Alumni Association lost all previously allocated grant funding, while the City of Laurel Multiservice Center, Joan’s House Inc., and the Prince George’s County Economic Development Corporation received new funding allocations.
At-Large Councilmember Jolene Ivey, who served as Chair during the prior allocation, criticized the reallocation of funds.
“These nonprofits were counting on that money and many of them have started spending with that money in mind. To have that rug pulled out from under them is a disappointment,” she said.
One of the local nonprofits that lost their previously allocated funding is Autism FYI, a Bowie-based nonprofit dedicated to providing employment opportunities and improving safety for County residents with autism.
During a press conference held by Ivey, Dr. James Benjamin, who runs Autism FYI, spoke about the impact these funding cuts would have on his nonprofit.
“We got notified just last week that we won’t get the executive grant,” said Benjamin. “That’s two grants that are gone. Me and my wife have given more than six figures to this nonprofit. With my back injured, I can’t donate that any more, and we will have to close down shop.”
Elsie Jacobs, a leader with Suitland Action Team, argued that her area was left out of the 2024 grant allocations and testified in support of the new grant funding during the May 12 hearing.
“We have senior citizens that I presented to the councilwoman, about 15 or 16 seniors, who would be evicted,” she said. “In my whole history, I’ve never seen senior citizens put out on the street.”
Maryland Democratic Party Chair Ken Ulman Stepping Down in June
Maryland Democrats will hold a leadership election on June 21 to replace Ken Ulman, who announced his intention to resign on May 21 during meetings with Prince George’s County chairs and top party donors.
He will step down officially on June 13.
“I am reaching out today to let you know in the near future I will be stepping down as Chair of the Maryland Democratic Party. Governor Moore, Dr. Dukes, and I are recommending the full state central committee elect Anne Arundel County Executive Steuart Pittman to be the next Party Chair at our Summer meeting on June 21st,” he said in an email.
“Serving as Chair of the Maryland Democratic Party has been one of the great professional honors of my life. I am grateful to every member of the central committee who allowed me this opportunity, and together, we accomplished some big things.
Ulman celebrated the election of Governor Wes Moore (D), Sen. Angela Alsobrooks’ (D) successful campaign against Larry Hogan, and raising over $5.5 million for the Maryland Department of Planning as some of his biggest accomplishments while leading the state party.
“I am grateful for Ken and his willingness to lead our party through an intense and demanding election,” the governor said in a statement. “His leadership was critical to maintaining Democratic power in this state and I look forward to his continued help and expertise.”
Moore is supporting Anne Arundel County Executive Steuart Pittman (D) to replace Ulman in the upcoming leadership election on June 21. Congressman Steny Hoyer (D- District 5) and Anne Arundel civil rights activist Carl Snowden are also supporting Pittman for the role.
Pittman, who was an early endorser of Moore’s gubernatorial bid, has helped to flip multiple Republican-held seats in Anne Arundel County during his two campaigns for County Executive.
“I am recommending County Executive Pittman because I know he is the right leader for this moment,” Moore continued. “With an all-out assault on our state and our values underway from Washington, D.C., I know he will put his experience and moral clarity to work to defend our state, fight back against the Trump administration, and ensure Democrats win elections.”