One of three major bond rating agencies downgraded the city of San Antonio's rating, the city confirmed Wednesday. After nine years of maintaining a AAA rating with the three major companies -- Moody's Investor Services, Fitch, and Standard & Poor's -- Fitch downgraded the city to a AA+ rating. The agency cited the recent passage of charter amendment C, which they said "diminished (the city's) expenditure flexibility." The voter-approved amendment allows the San Antonio Professional Firefighter's Association to call for binding arbitration in all issues on which the union and city disagree. The Fitch report states that the amendment allows for the union to force the city into binding arbitration during firefighters' collective bargaining agreement negotiations. “Firefighters and police comprise the city's largest expenditures, which have been expanding rapidly due to costly benefits," the report states. The "Go Vote No" political campaign that called for San Antonians to vote against the three propositions on the midterm ballot warned that the city's bond rating could be downgraded if the propositions passed. Propositions B and C succeeded. Mayor Ron Nirenberg said the downgrade is the city officials' warnings regarding the implications of propositions coming to fruition. "While it will be challenging, we are committed to the fiscal stewardship that will be required to regain our perfect bond rating. I am confident in our ability to address this situation," Nirenberg said in a written statement. "Councilman Brockhouse’s effort to shift responsibility for the downgrade is laughable. Everyone, including the agencies themselves, told us in advance this would happen. Councilman Brockhouse said it was just a scare tactic. Now voters know who was lying. ” City Manager Sheryl Sculley echoed Nirenberg's sentiments on the issue. “We are disappointed in the downgrade, but unfortunately not surprised,” Sculley said. “The ratings agencies told us earlier this year that, if passed, the propositions on the November ballot could severely limit our financial flexibility and operation of the city organization. While the city’s financial position is stronger today than in our annual review last summer, this downgrade is directly related to propositions B and C.” Last month, Sculley announced her resignation, then later announced her decision to forego a $100,000 bonus. According to a news release from the city, current outstanding debt "is fixed and will not be impacted by the downgrade." However, later debts will.
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