New Orleans saw its municipal bond rating downgraded by Moody's Ratings this week as the firm lowered its outlook for the city from stable to negative.

The financial services company on Wednesday downgraded the city's issuer rating, general obligation unlimited tax and general obligation limited tax ratings from A2 to A3, saying the decision was driven by the "significant, unbudgeted use of reserves in support of operations and one-time events in recent years that has materially narrowed the city's financial position."

It went on to say that although the city "is implementing various expenditure reduction and revenue enhancement measures, reserves will remain well below peers in the next two years."

Bond ratings are an indicator of a city's financial health, and lower ratings make it mo

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