credit rating

Brian Mackey

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.

Flickr user Pictures of Money / "Money" (CC BY 2.0)

A major bond-rating agency says the state's fiscal challenges linger despite approval of the first state budget in two years.

Moody's Investors Service issued a report Friday. It notes that an income tax increase approved this month will generate nearly $5 billion more a year.

It says the new revenue will ease the Prairie State's cash crunch. The political squabbling since 2015 between Republican Gov. Bruce Rauner and Democrats who control the General Assembly has contributed to a backlog of bills of nearly $15 billion.

A credit ratings agency has removed Illinois from a credit watch since legislators approved a budget and ended a more than two-year impasse.

S&P Global Ratings said Wednesday the outlook on debt ratings is stable. 

Illinois has the lowest credit rating of any state and agencies had warned of another downgrade to “junk'' status if lawmakers didn't approve a budget. The stalemate between Republican Gov. Bruce Rauner and the Democrat-controlled Legislature began in 2015. This month, legislators approved a budget with an income tax increase over Rauner's vetoes. 

mikefrerichs.com

The state treasurer says Illinois Gov. Bruce Rauner must go to New York to talk bond-rating houses out of knocking the state's creditworthiness into "junk" status.

Democrat Michael Frerichs said in Chicago Monday that the Republican governor should commit to the $36 billion spending plan the General Assembly adopted last week over his vetoes.

It includes a $5 billion income-tax increase. It's the first budget Illinois has had in two years because of political disagreements. Bond houses have threatened to knock Illinois' rating down to "junk" even with the budget deal.

Moody's Investors Service has placed six Illinois public universities on review for downgrade, impacting a total of approximately $2.2 billion of public university debt. According to a release issued by the company, the review is prompted by  "failure of the State of Illinois to enact a budget providing full operating funding to the universities for the current fiscal year 2017 and resulting operational and liquidity strains on the universities."

Pages