Moody’s Investors Service, S & P lower Illinois’ credit rating
Moody’s Investors Service and Standard & Poor’s on June 9 further downgraded Illinois’ credit bond rating. Fitch Ratings placed the state on negative watch.
The bond ratings agencies all pointed to the political gridlock that has led to the ongoing budget impasse and lack of action to address the state’s significantly underfunded pension system.
Bonds are a tool the state uses to borrow money. The lower Illinois’ credit rating, the higher the interest rate the state will pay on a loan.
Moody’s projected that the state’s bill backlog will surpass prior peak levels of about $10 billion in the coming months unless a budget deal is reached. Moody’s also cautioned that another downgrade could be imminent, and noted the state has a negative outlook, even with the downgrade.