Wednesday, May 12, 2010

signs that the Arizona Boycott is starting to affect the bottom line :)

Arizona Boycotts Could Hurt State's Bond Rating, Moody's Says
Bloomberg News, May 10, 2010

Arizona, where a new law aimed at cracking down on illegal immigration has drawn boycott threats, could see its bond rating hurt if protests harm the tourism industry, Moody's Investors Service said.

Travel-related spending produced $1 billion in state and local tax revenue for Arizona in 2008, Moody's said in its weekly outlook published today. Nineteen conferences have been canceled so far in Arizona as a result of the legislation adopted last month, Moody's said. While the cancellations will cost the state only about $6 million in revenue, Arizona could be hurt if the trend continues, the credit rating company said.

'Preliminary response to the immigration legislation has already had some impact on the state's tourism/travel sector,' Maria Coritsidis, a Moody's analyst, wrote in the report. 'A serious weakening of this important sector, however, could have a negative impact on the state's credit, as it could lead to further weakening of state finances that have already been negatively affected by the recession.'

Governor Jan Brewer signed legislation in April that makes it a state crime to be in the U.S. illegally and requires local police to determine the immigration status of anyone suspected of being in the country without proper documentation.

Arizona's credit rating is Aa2, Moody's third-highest rating.