Default, Distress and Echoes of Detroit
Moody's annual Municipal Default Study on distress and defaults, plus lessons learned from Detroit’s bankruptcy 10 years later
An overview of Moody's annual Municipal Default Study offers insight into COVID’s repercussions on the muni market and leads to a discussion on how issuers will grapple with inflation and emerging stress. Plus, Detroit’s landmark bankruptcy filing 10 years ago continues to reverberate in the market – and in our analysis at Moody’s.
- Why are there so few recent examples of distress among rated municipal credits despite a pandemic and sputtering economy?
- How have unrated municipal credits dealt with distress and how does that compare with rated issuers?
- What can we expect as pandemic relief aid tapers off and a new normal takes shape with remote work?
- How has Detroit changed municipal credit analysis?
- Will Detroit’s credit continue to improve as economic development strengthens but pension funding challenges return?
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SpeakersRachel Cortez Associate Managing Director, US Public Finance Moody's Ratings
Naomi Richman Senior Vice President, US Public Finance Moody's Ratings
David Strungis VP-Senior Analyst Moody's Ratings
Sarah Jensen Vice President - Senior Analyst Moody's Investors Service
Dan Seymour Vice President - Senior Analyst Moody's Investors Service
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Rachel Cortez is an Associate Managing Director with the US Public Finance Group of Moody’s Ratings. As the manager of Moody’s Chicago-based analytical team, Rachel oversees local government credits in ten Midwest states. She has extensive experience covering tax-backed and revenue-secured credits issued by US local governments and not-for-profit health care organizations.
Prior to joining Moody’s in 2005, Rachel spent five years with American Management Systems (now CGI Group), where she implemented budget and financial management systems for state and local governments. She was also a budget analyst with the State of Illinois Bureau of the Budget (now Office of Management and Budget) and spent several years working in development and fundraising for a Chicago not-for-profit organization.
Rachel is a former President of the Chicago Municipal Analysts Society (CMAS) and served on the Board of Governors of the National Federation of Municipal Analysts (NFMA). Rachel received an MPA from the Maxwell School of Syracuse University and a BA in Government from Cornell University.
Naomi Richman is a Senior Vice President in Moody's US Public Finance Group. Naomi manages the Surveillance team and Data and Analytics team. She is also responsible for contributing to state and local government analytical initiatives, research and methodologies. Naomi was previously a Managing Director in US Public Finance and Chief Credit Officer for global public sector ratings. Naomi has over 35 years of experience in credit analysis at Moody's, covering state and local governments, housing, higher education, financial guarantors, and global sovereigns.
Prior to joining Moody's, Naomi spent four years with the New York City Department of Finance. Naomi holds an MPP from Harvard University and an AB from Bryn Mawr College.
David Strungis is a Vice President – Senior Analyst for the Chicago Local Governments Ratings Team. Since joining Moody’s in 2012, he has been a lead analyst for many local government credits in the Northeast and Midwest. Before he joined the Chicago team, David participated in numerous rating committees across public finance as a representative of the US Public Sector Ratings and Process Oversight group within Credit Strategy & Standards and has contributed to numerous research projects and methodology working groups. He also published various research pieces, including co-authoring the annual study of US Municipal Bond Defaults and Recoveries. Before joining Moody’s, David served as Mayor Pro Tempore of the City of Lafayette, Colorado (2005-2009). David holds an MPA from the NYU Robert F. Wagner School of Public Service and a BA in Political Science with a minor in Economics from the Metropolitan State University of Denver.
Sarah Jensen is an AVP-Analyst for the Dallas Local Governments Ratings Team covering credits primarily in Louisiana and Texas. She is a member of various analytical working groups including the Bankruptcy Taskforce.
Prior to joining Moody’s, Sarah was a Teaching Assistant at the University of Texas Lyndon B. Johnson School of Public Affairs and an Intern for the internal audit division of the office of the Governor for the State of Texas. Sarah holds an MPA from the University of Texas at Austin and a BA in Public Affairs and Administration from the University of Oklahoma.
Dan Seymour is a Vice President – Senior Analyst for Credit Strategy and Standards/Rating and Process Oversight (RPO). Based in New York, he works closely with analysts both in the Sub-sovereign and US Public Finance groups. Prior to joining RPO, he was a lead analyst for US states and before that, US local governments.
Before joining Moody’s, he was a reporter from the Associated Press and the Bond Buyer Newspaper. Dan holds a BA from Rowan University and a Master’s degree from Baruch College. He is a Chartered Financial Analyst charterholder.