Fitch Ratings

Piling it on: Fitch downgrades Cook County

07/14/2014

Cook County residents got more bad news last week when Fitch Ratings, the global rating agency, downgraded Cook County’s debt to A+ from AA-. The rating agency cited skyrocketing pension costs as one of the key reasons for the credit downgrade. The most direct impact of the downgrade is higher borrowing costs for Cook County. Infrastructure and...

Don’t buy mom Illinois bonds for Christmas

12/19/2013

Would you invest your mother’s money in municipal bonds? In a recent interview on Fox Business News, host Gerri Willis asked me that very question. It didn’t take me long to say I’d certainly do my homework first. Based on the growing number of city bankruptcies from Alabama to Rhode Island to California, it’s clear to me...

Illinois’ penalty for borrowing now 7 times higher than when Quinn took office

12/14/2013

This week Illinois borrowed $350 million to pay for projects including roads, bridges and schools. The state issued 25-year taxable general obligation bonds, the first borrowing by Illinois since the state passed its pension “fix” in early December. But not unlike someone with a terrible credit score, Illinois must pay the highest penalty rate of...

TAGS: credit rating, pensions

Illinois has lowest credit rating of all 50 states

By John Klingner

11/19/2013

Chicago’s recent triple-notch downgrade by Fitch Ratings is a stark reminder that Illinois’ inability to solve its pension crisis has consequences. Illinois has the lowest credit rating of all 50 states. In contrast, three of its neighbors have maintained their AAA rating from Standard & Poor’s Ratings Services. Illinois has suffered 13 downgrades from the...

TAGS: Chicago, credit rating, downgrade, pensions

The next municipal bankruptcy?

By John Klingner

11/15/2013

Yet another city is heading toward bankruptcy. Desert Hot Springs, Calif., a city of 26,000 in the south-central part of the state, warned it could run out of money as soon as March 2014. If that occurs, the city could be forced to file for bankruptcy. If that happens, Desert Hot Springs will be the...

TAGS: bankruptcy, Desert Hot Springs, pensions

Fitch Ratings: Chicago approaching “inflection point”

11/12/2013

Triple-notch credit downgrades for government entities are supposed to be rare. They normally happen only in response to major financial events, such as a sudden fiscal emergency. But Chicago just received its second triple-notch downgrade in just six months. And that spells trouble for Chicago taxpayers. Citing skyrocketing pension costs and a lack of meaningful...

TAGS: Chicago, Chicago Park District, Detroit, downgrade, pensions

Capitol Updates: Special session

By Jane McEnaney

06/19/2013

In early June, Gov. Pat Quinn called lawmakers to return to Springfield on June 19 for a one-day special session on pension reform. This came in the wake of yet another downgrade of Illinois’ credit as a result of inaction on pension reform when the legislative session adjourned on May 31. Our most recent knocks from Moody’s Investors Service and Fitch Ratings mark Illinois’ 12th...

Illinois pension debt to double as new Moody’s methodology kicks in

06/17/2013

It’s taken as fact that Illinois’ five state-run pension systems have a $100 billion funding shortfall. That’s what the official reports say. But all that’s about to change. Moody’s Investors Service is making good on its promise to evaluate state pension plans on more realistic assumptions. The rating agency has long critiqued the pension funds’...

TAGS: credit rating, pensions

Moody’s downgrades Illinois credit rating: 13th credit downgrade under Quinn

06/06/2013

by Ted Dabrowski Moody’s Investors Service downgraded Illinois’ credit rating to “A3” from “A2” after the General Assembly failed to move forward on pension reform before the end of the spring legislative session. The rating agency also says it has a negative outlook on Illinois’ credit: “The negative outlook reflects our expectation that Illinois’ pension...

Fitch downgrades Illinois after lawmakers fail to pass pension reform

06/03/2013

by Ted Dabrowski Fitch Ratings downgraded Illinois’ credit rating to “A-” from “A” after the General Assembly failed to move forward on pension reform before the end of the spring legislative session. In its statement announcing the downgrade, Fitch called Illinois’ pension liability “unsustainable” and said it was concerned about the state being able to...

Taxed out: 10 reforms to stop Illinois from losing people and jobs

Illinois’ tax code stands in the way of the state’s economic competitiveness. The combination of high tax burdens and a poor tax structure contributes to the loss of jobs and investment to other states. From a place of former economic dominance, Illinois now ranks 45th in gross state product (GSP) growth over the past decade...

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