Moody’s Investors Service removed Florida from its list of potential downgrades Tuesday, saving the state hundreds of millions of dollars in potential interest payments.

The company reaffirmed Florida’s top rating, Aa1, citing the state budget that cut $3.6 billion in expenditures while raising $2.4 billion in taxes and fees.

The roughly $1 billion left in reserves gave ratings analysts comfort that the state would not default on its debt.

But the ratings company noted that Florida’s immediate economic future remains bleak.

Analysts said there was little hope the state would turn around its double-digit unemployment rate, struggling housing market and minimal population growth before the end of 2010.

Florida’s bond rating was politicized during a 10-day budget standoff this spring between House and Senate Republicans. Each side claimed its budget would satisfy concerns from the ratings company.

On Tuesday, House Majority Leader Adam Hasner, R-Boca Raton, said the company’s action reaffirmed his chamber’s position to hold more money in reserves.

“Our willingness to make the difficult but necessary decision to raise revenues and start rebuilding reserves will create a stable financial environment for Florida’s economy to rebound,” Hasner wrote.

Last week, Fitch Rating affirmed the state’s $13 billion in outstanding bond debt at favorable rates.

But Fitch, too, gave Florida a pessimistic outlook, saying the state’s reliance on real estate and consumer spending for much of its revenue made it “especially susceptible” to downturns in the housing market.

This story appeared on page 8A of the July 15 edition of The Palm Beach Post.

Tags: bond rating, Moody's, Republicans

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