TRENTON – Another credit rating agency has improved its outlook for New Jersey’s finances, ahead of next month’s introduction of the next proposed state budget.

The “Big Three” agencies – Fitch Ratings, Moody's Investors Service, and S&P Global Ratings – had already adopted a positive outlook for the state’s bonds since last summer.

Kroll Bond Rating Agency joined them Tuesday, citing the “robust recovery of the state’s financial picture since the early days of the pandemic and ample liquidity,” which enabled the state to dedicate surplus funds to pay down debt and make a full contribution to the pension fund.

“Upward movement in the rating assumes that the State will take steps necessary to maintain full actuarial funding on a go-forward basis, allowing it to gradually restore its pensions to sound funding status in the decades ahead,” Kroll said. “Consistency in both pension funding and the maintenance of strong reserves will be integral to upward movement in the rating.”

Part of that surplus resulted from the state borrowing around $4 billion in November 2020 to guard against an anticipated collapse in revenues that didn’t materialize.

New Jersey remains one of the states with the lowest credit ratings, along with Illinois. Its S&P rating was at the AA level as recently as 2010 but was downgraded in 2011, 2014, 2015, 2017 and 2020 and is currently BBB+.

Still, the Murphy administration says the outlook upgrades are a good sign.

“The decisions made in our first term in office to build a surplus, address long-standing pension underfunding, and take up the fight against skyrocketing health care costs show the investment community that we are serious about righting New Jersey’s financial ship,” Gov. Phil Murphy said.

“The consensus of the major ratings agencies is that the Murphy Administration’s actions have put the State of New Jersey on more solid fiscal footing, despite the external pressure of the COVID-19 pandemic and the resulting economic volatility,” said state Treasurer Elizabeth Maher Muoio.

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Murphy is scheduled to propose a fiscal 2023 state budget on Feb. 22. He said it will not include any new tax increases.

Michael Symons is State House bureau chief for New Jersey 101.5. Contact him at

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