As soon as the concessions deal is done, expect to hear Gov. Dannel P. Malloy begin to work in the state’s bond rating into his stump speech about why the tough medicine of his budget was necessary. Geeky stuff, but Malloy will make the case that the pain he is inflicting now will serve the state in the long run.

Standard & Poor’s and Fitch each mentioned the budget today in affirming the state’s AA bonding rating. That alone was a good thing for Malloy, but S & P also hinted that the state’s unfunded obligations are what is standing between Connecticut and a higher rating that lowers the cost of borrowing:

“The state has a history of what we consider highly cyclical budget performance, which has led to its issuance of debt to cover operating deficits in recessionary periods. Connecticut’s above-average debt levels and unfunded pension liabilities, which are among the largest in the nation as measured by funded ratio, also affect our opinion of its creditworthiness.”

Malloy has been trying to translate his insistence on addressing those obligations into a tangible benefit, say, lower interest rates the next time the state wants to borrow money to repair bridges and highways.

Mark is the Capitol Bureau Chief and a co-founder of CT Mirror. He is a frequent contributor to WNPR, a former state politics writer for The Hartford Courant and Journal Inquirer, and contributor for The New York Times.

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