Metro officials received some bad news on the financial front Friday with Moody’s Investors Service announcing that it has downgraded the transit authority’s bond rating, a move that could make it more expensive to borrow money, reports the Washington Business Journal’s Michael Neibauer.

Neibauer weirte:

“The downgrade reflects a ramp-up by WMATA of short-term debt as a tool to bridge restrictions on its receipt of federal funds, the result of findings from a Federal Transit Administration audit of the Authority’s grant’s management process,” said the announcement from Moody’s,

He added:

Per Moody’s, the [Federal Transit Administration’s] response to the May 2014 audit report “constrained WMATA’s liquidity and led it to draw fully on its lines of credit and enter into private financings to maintain capital spending.” Its credit rating was lowered from Aa3 to A1, which is still a relatively strong position.

Moody’s cited Metro’s ongoing financial problems tied to a 2014 audit report that found serious problems with its handling of federal grants. As a result, Metro’s ability to draw on those grants has been restricted forcing it to take out a series of short-term loans  to pay its bills. Metro’s troubled finances also have spilled over into the search for a new general manager, which was suspended earlier this month. Board members are split between those who want a financial turnaround wizard and those who want a leader with a traditional transit background.

Metro’s Chief Financial Officer Dennis Anosike had this to say about the downgrade:

“WMATA’s financial condition is stable and improving, as we continue to work closely with the Federal Transit Administration to overhaul our grants management program. We are disappointed in this decision, as it fails to recognize the significant progress our team has made over the past six months, during which federal reimbursements to WMATA have greatly accelerated.  WMATA’s Board and Management will continue to demonstrate to our funders and the market that not only have our steady improvements resulted in approximately $700 million in new grant applications and $585 in federal grant approvals, but also placed the Authority in a stronger overall financial position.”