S&P Upgrades West Virginia's Credit Outlook to Positive, Affirms AA- Rating

S&P Global Ratings has upgraded West Virginia's credit outlook to positive from stable while affirming its AA- rating on the state's general obligation debt.

Gov. Patrick Morrisey said the move reflects his administration's commitment to fiscal responsibility and efficient government operations.

"This positive rating action affirms my administration's approach to our budget and West Virginia's long-term financial health," Morrisey said in a statement. "Our future is bright, with employment forecasted to continue to grow over the next several years, but we cannot ignore the medium- and long-term budget pressures that exist."

Morrisey noted the upgrade marks the first positive action by S&P regarding West Virginia's creditworthiness in more than a decade.

In its report, S&P credited the state's "recent run of large budgetary surpluses, multiple ample reserve funds, and management actions to control costs." The agency said those factors, along with conservative budgeting practices, should allow West Virginia to maintain structural balance and healthy reserves even as federal policy changes pose potential challenges.

"We expect the state to be able to address the changing federal policy landscape while maintaining structural balance and healthy reserves," the report stated. "The state budgets conservatively and tracks revenue and expenditures monthly, maintains a six-year financial forecast, and maintains investment, reserve and liquidity policies."

S&P also projected West Virginia will increase total employment by 0.6% from 2025 through 2028, which it said reflects a positive economic trend.

"The state has, when needed, made spending reductions, and gap-closing solutions are generally focused on structural budget balance rather than on nonrecurring revenue or expenditure actions," S&P said.

This credit upgrade represents a significant milestone for West Virginia's fiscal management. The positive outlook signals to investors and the financial community that the state's financial trajectory is strong and improving. It can also result in lower borrowing costs for the state, saving taxpayers money on future bond issues.

The upgrade validates the administration's focus on conservative budgeting, building reserves, and maintaining structural budget balance. It also reflects confidence in West Virginia's ability to navigate potential federal policy changes while continuing to grow employment and maintain fiscal stability.

For a state that has historically faced economic challenges, this recognition from a major credit rating agency represents an important vote of confidence in West Virginia's financial management and economic future.