The basics:

• S&P upgrades NJ general obligation bond rating from A to A+
• Eighth rating boost under Gov. Phil Murphy
• Credits stronger reserves, lower debt and pension liabilities
• Stable outlook signals improved fiscal health for the state

S&P Global Ratings announced a rating upgrade on the state’s general obligations bonds from A to A+.

The Aug. 11 upgrade marks the eighth under Gov. Phil Murphy. The ratings agency cited the Murphy administration‘s work to increase its surplus and reduce long-term liabilities. S&P previously raised New Jersey’s rating from BBB+ to A- (March 2022) and from A- to A (April 2023).

“Against an ever evolving economic and policy backdrop clouded by uncertainty, we believe the state’s diligent work in rebuilding and preserving, to a degree, a stronger level of reserves while diligently addressing its large legacy liability challenges will help blunt budgetary pressure, as they arise,” S&P Global Ratings wrote in its analysis.

“The upgrade reflects our view of the meaningful improvement in the state’s balance sheet reflecting management’s commitment to rein in its comparatively large debt and pension liabilities while striving to achieve a structural budget balance longer-term,” the ratings agency continued.

Coupled with the maintenance of a healthy reserve balance, we believe the state has transitioned to an operating environment that is more predictable and stable …

“Coupled with the maintenance of a healthy reserve balance, we believe the state has transitioned to an operating environment that is more predictable and stable, which strengthens management’s ability to address budgetary challenges as they arise.”

S&P noted that the outlook is stable for all ratings.

Heading in the right direction

In a press release, Murphy said that the rating upgrade is a testament to the hard decision his administration made to address the high levels of indebtedness it inherited upon taking office.

“From making five consecutive full pension payments to narrowing our structural deficit to building a stronger, reliable surplus to help weather economic volatility, we have made enormous strides to turn New Jersey’s fiscal ship around after decades of mismanagement from both sides of the aisle,” said Murphy.

State Treasurer Elizabeth Maher Muoio credited the governor’s leadership for budgets that she says have focused on building a state that is better positioned to meet its financial obligations, reduce its reliance on bonded debt, and to weather unforeseen fiscal challenges.

“This eighth upgrade in just over three years is further independent confirmation that our continued efforts to strengthen New Jersey’s financial health have been a success,” said Muoio. “Having changed the trajectory – from decades of credit rating downgrades to now eight upgrades under the Murphy administration – is validation that our state is in far better financial shape thanks to these efforts.”

Murphy added, “Although there is much more work to do by the next governor, I’m proud that we’ve done right by taxpayers by tackling longstanding fiscal challenges that stacked up over decades.”

The full S&P analysis is available here.

‘An endorsement’

Senate Budget Chair Paul Sarlo, D-36th District, said the ratings upgrade is the byproduct of the responsible budget and fiscal practices that the state has employed in recent years.

“It’s an endorsement of the actions the Legislature and the governor have taken over multiple budget cycles to effectively manage state finances, often in the face of challenging economic conditions,” said Sarlo. “The upgrade will result in saving taxpayers’ money.”

‘Misleading to investors’

Senate Republicans, however, ripped S&P Global ratings – accusing them of misleading investors and potentially causing them to misread the trajectory of the state’s finances with this upgrade.

Budget Committee members Sen. Declan O’Scanlon, R-13th District, and Sen. Mike Testa, R-1st District, wrote a letter Aug. 13 to S&P Global Ratings CEO Martina Cheung.

“Someone at S&P Global Ratings needs to be held accountable for the recent upgrade of New Jersey’s credit rating. Though New Jersey remains a reliable issuer for bond buyers, the increased rating clearly flies in the face of common sense and will discourage appropriate cost restraints and fiscal practices that would truly make New Jersey worthy of this upgrade and future upgrades,” the Republican senators wrote in the letter, pointing to the most recent budget process.

“Increasing New Jersey’s rating shortly after the adoption of a budget that sticks the incoming governor (of whichever party) with a $4 billion structural imbalance is beyond a simple mistake. It is misleading to investors and will cause them to misread the poor trajectory of New Jersey finances.”

In an Aug. 11 post on X, Testa wrote:

“Wall Street rating agency S&P just increased the State’s credit rating despite the recently enacted budget leaving the next Governor an almost $4 billion budget hole. That’s almost as stupid as when S&P had to pay $1.5 billion for their role in wrecking the global economy,” said Testa on social media, referring to a 2015 settlement the firm made with the U.S. government resolving lawsuits over mortgage securities ratings.

S&P Global Ratings did not immediately respond to a request for comment.

Editor’s note: This story was updated at 10:08 a.m. EST Aug. 14, 2025, with reaction from lawmakers.