...Ratings Stability: The sector outlook is stable, with one more year of fairly positive momentum in some key credit areas. The vast majority of individual Rating Outlooks are Stable. Stable Property Tax Trends: Continued housing market recovery has led to property tax improvement in most areas. Assessed values (AV), a leading indicator of property tax revenues, are generally on the rise for fiscal 2015. Home price trends, as assessed by Fitch Ratings' Sustainable Home Price (SHP) model, should generally remain positive. Other Revenues More Variable: Economically sensitive revenues, such as sales and income tax receipts, continue to show growth but are more volatile than property taxes, and results vary regionally. Performance of these two main sources of state revenue is also somewhat predictive of aid to local governments. Spending Under Control: Spending pressure has shifted from making sizable cuts to keeping growth in check, as measures to reduce spending during the downturn have resulted...
