A major credit rating agency says Illinois won't see its rating lowered to "junk" but warns the state still faces serious financial challenges and long-term risks.
On Thursday, Moody's Investors Service affirmed the current Illinois rating with a negative outlook, saying a downgrade remains possible in the next two years.
Moody's put Illinois under review for a downgrade earlier this month, after the state entered its third fiscal year without a budget. That would've made Illinois the first U.S. state to have a rating below investment grade and cost taxpayers millions of dollars more in interest on bond sales.
Moody's says the budget that legislators approved July 6 over Gov. Bruce Rauner's objections moved Illinois "closer to fiscal balance."
But the agency warns the budget doesn't reduce the unfunded Illinois pension liability, which is larger than any other state.
