Possible credit rating downgrade looms for Illinois over pension issues

Aug 23, 2012

A failed special session that was supposed to lead to the passage of pension reform has pushed Illinois closer to a downgrade of its credit rating.

Gov. Pat Quinn ordered lawmakers back to Springfield last Friday to deal with the state's massively underfunded pension systems, but the chambers could not agree on a deal.

Moody's Investors Service took note of that today, calling the failure a "credit negative." That could signal a future downgrade in Illinois's credit rating, which is already the lowest in the country - making it more expensive for the state to borrow money.

Standard & Poor's Ratings Services issued a similar warning on Wednesday.

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