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Aug 17, 10:02 AM EDT

Pennsylvania's fiscal situation sees good, bad news


HARRISBURG, Pa. (AP) -- There's good news and bad news for Pennsylvania state government finances.

The New York-based Moody's credit rating agency is upgrading the battered rating of a state program that helps school districts get more favorable loan terms by giving a guarantee to repay bondholders.

Moody's cited a July law that strengthened the program, even during a budget stalemate like the one that dragged 10 months into the state government's 2015-16 fiscal year.

However, an entrenched deficit is still plaguing state finances, and the state Treasury Department said Tuesday that it is providing a $2.5 billion credit line to prevent the state's main bank account from being overdrawn.

It says draw of $400 million was immediately made. It's the seventh time since the recession it has provided such assistance.

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