Mixed Impact: High Inflation on US Public Finance Sectors
High inflation is having a mixed credit impact on US state and local governments and a more negative impact on US hospitals. Wage pressure is a common denominator across sectors, but governments have a partial hedge on the revenue side given nominally rising sales and income taxes. Managing through high inflation and a real economic slowdown will test fiscal discipline.
- High inflation and employment shortage pushing up wage and benefit costs
- Nominally rising tax revenues a partial inflation hedge for governments
- Hospitals' performance curbed by inflation and labor shortages
- Soaring construction costs hit capital budgets, raise disaster recovery expense
- Premium on strong management in event of real economic downturn
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SpeakersTimothy Blake Managing Director, Public Finance Group Moody's Ratings
Dan Kowalski Analyst Moody’s Investors Service
Douglas Goldmacher Vice President / Senior Analyst Moody's Investors Service
Beth Wexler Vice President/Senior Credit Officer Moody's Investors Service
Michael Wertz Vice President - Senior Analyst, Public Finance Group Moody's Ratings
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Tim Blake is a Managing Director in Moody’s Public Finance Group responsible for US state ratings as well as local government ratings in the Eastern region. He also oversees ratings for US transit systems and a specialist team on government pension analysis. Tim has thirty years of experience in the municipal market.
Prior to joining Moody’s, Tim was a credit risk manager and ratings advisor at Goldman Sachs, and a credit and liquidity facility specialist at NatWest Markets.
He is a graduate of the State University of New York at Albany.
Dan Kowalski is an Analyst on the State Ratings Team, covering credits for the states of Georgia, Wisconsin, Minnesota, Indiana, Missouri, Oklahoma, Mississippi and New Hampshire as well as mass transit and federal lease credits. Dan was previously an analyst on the Chicago Local Governments Team.
Prior to joining Moody’s, Dan worked in prison education for the State of New Jersey. Dan holds a BA in Politics from Princeton University and an MPP in Municipal Finance and Economic Policy from the University of Chicago Harris School.
Douglas is a Vice President/Senior Analyst in Moody’s Public Finance Group and the lead analyst for local government credits in New Jersey. He joined Moody’s in 2013 and has experience in a diverse portfolio of local government, enterprise, federal lease and mass transit credits.
He is also the author of numerous research pieces including “Decoding New Jersey Municipal Accounting” which explains the adjustments Moody’s makes to New Jersey fund balances.
Prior to joining Moody’s, Douglas worked for Xerox. He received his BA from Duke University with a double major in History and French. He holds an MBA from the University of Rochester’s Simon School of Business
Beth is a Vice President/Senior Credit Officer in Moody’s Health Care ratings group. Her responsibilities include assigning and monitoring healthcare ratings within the states of Florida, Maryland, New York, Pennsylvania, Ohio, Illinois, Indiana, Virginia, Wisconsin, Delaware, and West Virginia. A sampling of obligors in Beth’s portfolio include Geisinger Health, University of Wisconsin Hospitals & Clinics, H. Lee Moffitt Cancer Center, NYU Langone Hospitals, Johns Hopkins Health System, Inova Health System, MedStar Health, Memorial Sloan-Kettering, Sentara Healthcare, University of Maryland Medical System, and University of Pittsburgh Medical Center. Beth has expertise in liquidity and complex debt structure analysis, including self liquidity programs. She is also the co-chair of Moody’s Public Finance Compliance Task Force.
Beth joined Moody’s in 1997. Prior to joining Moody’s Beth spent five years as an underwriter and surveillance officer with Financial Security Assurance. Beth earned her M.B.A. with a concentration in health care administration from Mount Sinai School of Medicine/Baruch College and her B.A. in sociology from the State University of New York at Albany.
Michael Wertz is a Vice President/Senior Analyst for the Eastern Local Governments Ratings Team. His primary coverage responsibilities include cities, towns, counties, and school districts in Connecticut and Mississippi, for both of which he is the state lead, as well as New York and various water and sewer utilities throughout the Eastern United States. As a senior member of Moody’s ESG task force, Michael has published commentary on Moody’s approach to incorporating exposure to climate change in local government ratings and on the impact of drought on credit quality. He has also published research about community colleges and city pension reform.
Prior to joining Moody’s, Michael was a public sector consultant focusing on federal and local government projects. Michael holds an MPA from the Maxwell School of Citizenship and Public Affairs at Syracuse University and a BA in Political Science from the University of the Incarnate Word in San Antonio.