BALTIMORE (WBFF) — Three months after Baltimore leaders approved the largest budget in city history, the city’s finances are facing renewed scrutiny following a recent bond-rating downgrade and warnings from fiscal analysts about mounting debt.
“We take managing taxpayer dollars very seriously,” said Mayor Brandon Scott in June. But Taxpayer Advocate David Williams disputed that assessment, saying, “There is no indication the mayor takes fiscal responsibility seriously at all.”
Two weeks ago, Moody’s downgraded Baltimore’s bond rating from an Aa2 to an Aa3. Economist Anirban Basu said the move signals worsening conditions: “It means the city’s financial circumstances are deteriorating.”
Sheila Weinberg, whose organization Truth in Accounting reviews government financial statements, said Baltimore is carrying “Three billion dollars in debt that they have no idea how they’re going to pay.” Analysts at the nonprofit said they spent weeks reviewing a decade of the city’s spending patterns and concluded the debt load will be difficult to overcome. “In order to get the city debt free each taxpayer would need to send 14-thousand dollars just to get them back to zero,” said Weinberg.
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Even as analysts raise concerns about the city’s existing debt, Baltimore leaders are asking voters to approve additional borrowing. On the November ballot, voters will decide whether the city should borrow $22 million for an affordable housing loan, $60 million for a school loan, $50 million for a community and economic development loan, and $148 million for public infrastructure. If approved, the measures would authorize a total of $280 million in new loans to be repaid later.
Weinberg argued that access to credit should not be the deciding factor for taking on more debt. “Just because people will lend you money doesn’t mean you should borrow it,” she said. She also compared the city’s situation to personal finances, asking, “If you personally had credit card debt would you go out and borrow more money or would you pay more than the minimum…..?”
Economists and analysts also warned that the downgrade could make new borrowing more expensive. With a lower bond rating, they believe the city could be forced to pay higher interest rates if voters approve the new bond measures. Weinberg said the city’s debt load itself is evidence of deeper problems, adding, “Evidence of that is…they’ve incurred 3-billion dollars in debt even though they’ve theoretically balanced the budget every single year.”
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