As local governments watch the saga in Detroit unfold, they are mulling the ripple effect on their own bond sales. In Prince George’s County, one of a handful of jurisdictions with the coveted Triple A bond rating, the county’s chief administrative officer said he thought the impact would be minimal.
And, said Bradford L. Seamon, the top aide to Prince George’s County Executive Rushern L. Baker III (D), there even could be a silver fiscal lining.
“It is possible that you might get more interest in the higher rated localities. But we don’t have any fantasy that they [investors, Wall Street, bond houses, etc.] won’t raise an eye,” Seamon said.
“It is not a good thing. We understand that,” he said.
Prince George’s has about $800 million in bond debt
Seamon said that even when U.S. debt was downgraded by Wall Street, “we did not get an indirect effect, and the federal government [debt] is supposed to be stronger than us.