LA.'s Credit Outlook Downgraded to Negative

The L.A. Times reports:

One of the nation's top financial credit services Wednesday issued a negative outlook for Los Angeles, which is struggling with a $212-million deficit. The move could lead to a lower credit rating for the city and ultimately increase its cost for borrowing money.

Moody's Investors Service reduced its opinion of L.A.'s finances from "stable" to "negative" because city officials delayed addressing the budget shortfall -- expected to grow to $485 million in 2010-2011 -- and have proposed tapping reserves to balance the books.