Municipal Bond Rating Reform:
Protect Taxpayers, End the Double Standard
Welcome to the Fair Bond Ratings page. This site is devoted to helping issuers, investors and other market participants join the national campaign to reform the rating agencies' unfair system for grading bonds issued by governmental entities which provide essential services to the public. The system burdens taxpayers with unwarranted costs and misleads investors.
Action
Moody's to Transition Public Finance Ratings to a Single Global Scale
Comment Period Extended to June 30, 2008
In March, Moody's sought comments on a plan to assign global scale ratings to any municipal bond issue, as a supplement to the regular public finance rating. After receiving feedback from more than 150 market participants, Moody's concluded there was strong preference for a single rating scale. Accordingly, Moody's says "we are proposing to proceed with a single rating scale for public finance issuers, and to transition our public financing ratings to our global scale." Given the new proposal, Moody's is soliciting additional comments until June 30.
Read Moody's Latest Announcement
Comments Submitted in Response to March Request
Read Moody's March 2008 Announcement
- California's Comments
- Bank of America Comments
- Citi Comments
- De La Rosa & Co. Comments
- DEPFA First Albany Securities LLC Comments
- Fieldman, Rolapp & Associates Comments
- Government Finance Officers Association Comments
- Lamont Financial Services Comments
- Loop Capital Markets, LLC Comments
- Montague DeRose and Associates, LLC Comments
- Morgan Stanley Comments
- National Association of State Treasurers (NAST) Comments
- New Jersey Educational Facilities Authority Comments
- Public Resources Advisory Group Comments
- Ramirez & Company Comments
- Rice Financial Products Company Comments
- Siebert Brandford Shank & Co. Comments
- Stone & Youngberg Comments
- UBS Investment Bank Comments
Latest Developments
- Treasurer Lockyer Urges California Members of House Financial Services Committee to Support Rating Reform Legislation
- City of Carlsbad Letter to Rating Agencies
- Treasurer Lockyer Supports New Federal Legislation to End Double Standard for Bond Ratings
- Moody's Proposes Single Scale for Municipal, Corporate Bonds
- City of South Lake Tahoe Letter to the Rating Agencies
- City of Hemet Letter to Rating Agencies
- NY AG Cuomo Announces Landmark Reform Agreements With Nation’s Three Principal Credit Rating Agencies
- City of Laguna Beach Letter to Rating Agencies
- City of Scotts Valley Letter to Rating Agencies
- City of Diamond Bar Letter to Rating Agencies
In the News
- Lockyer Discusses New Moody's Rating Proposal, MuniMarket Pulse -- June 19, 2008 (requires a media player)
- Treasurer Lockyer Comments on Moody's Proposal for Single Rating Scale -- June 12, 2008
- Treasurer Lockyer Discusses Reform on CNBC -- April 29, 2008
Articles
- Ratings Reform Won't Hurt Triple-A State, Virginia's Wagner Says
Lynne Funk
Bond Buyer; June 27, 2008 - SEC Aims to Limit Credit Ratings' Influence
Neil Irwin
Washington Post; June 26, 2008 - The Ratings Racket
Editorial
Wall Street Journal; June 25, 2008 - SEC Aims to Rein in the Role of Ratings
Aaron Lucchetti, Kara Scannell and Craig Karmin
Wall Street Journal; June 24, 2008 - Rating Bill May Ease Strictures
Andrew Ackerman
Bond Buyer; Jun 19, 2008 - Ratings Should Allow Comparison Between Munis, Corporates: Panel
Peter Schroeder
Bond Buyer; June 17, 2008 - Moody's to Delay Rating Plan
Aaron Luccheti
Wall Street Journal; June 13, 2008 - Moody's Muni Ratings Overhaul Undermines MBIA, Ambac (Update1)
Michael McDonald
Bloomberg; June 13, 2008 - Moody's Changes Course on Ratings Scale
Dakin Campbell
Bond Buyer; June 13, 2008 - Moody's May Align Municipal Debt Ratings With Corporate
Vikas Bajaj
New York Times; June 13, 2008
Opinion
- Lockyer tackles the bond game
Los Angeles Times; April 7, 2008 - Bill Lockyer: Government bonds deserve same ratings as business
The Sacramento Bee; April 6, 2008 - Rethinking state bond ratings
Los Angeles Times; March 11, 2008