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* The Quincy School District’s bond rating was recently lowered and the culprit appears clear…
S&P Global Ratings downgraded the district’s rating from A- to BBB+ “due to a fiscal imbalance that has resulted in a substantial drop in available cash reserves,” according to an analysis presented at Monday’s Finance Committee meeting.
“What has occurred is not necessarily the fault of the district,” said Bob Lewis, senior vice president and managing director of PMA Securities, Inc., which is working with the district on the bond sale.
Last year’s deficit was primarily caused by an unexpected drop in the personal property replacement tax, and “this year’s deficit is going to be primarily caused by delayed categorical payments. None of that is your fault, and ratings analysts recognize that, but they still have to evaluate your credit for investors,” Lewis said.
The district also faces “the Illinois premium” because of the state’s continued financial issues.
“It means your borrowing costs are higher because of what the state does. If the state continues to get downgraded, the Illinois premium will continue to widen,” Lewis said. “We anticipate an additional .1 to .15 percent to the borrowing rate because of that.”
Wait. I thought the state had increased funding for K-12.
Oh, yeah. There’s not enough money to keep those promises. Silly me.
posted by Rich Miller
Tuesday, May 23, 17 @ 9:28 am
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Depleted reserves, higher interest rates, higher property taxes, lay offs, students leaving Illinois, destroyed higher ed institutions, lower tax base because they won’t come back.
This is still the speakers fault?
Rich, how about an analysis just on how much money the governor is making off of this mess. Just the lower tax rate has to be making him 10’s of millions, right?
Comment by Hit Em With the Hein Tuesday, May 23, 17 @ 9:33 am
Out of the Tool Box and at Work on the Schools…
https://www.youtube.com/watch?v=PwrKum_4Hwk
Wonder what pre-screened question Rauner will use on his See-n-Say for today’s Facebook gig about school funding. How many downgrades, not just state downgrades, have happened under Rauner’s “volunteer” effort??? Quinn’s record is looking pretty anemic compared to the blood loss under Rauner.
Comment by Anon221 Tuesday, May 23, 17 @ 9:52 am
Well I certainly hope Mr. Oakley thinks that Herald-Whig endorsement is paying off for Quincy.
Comment by Daniel Plainview Tuesday, May 23, 17 @ 10:03 am
Rauner’s bond buyer buddies will make a lot of extra money off of this.
Comment by DuPage Tuesday, May 23, 17 @ 10:08 am
But look at all the growth from the income tax cut.
Comment by Liberty Tuesday, May 23, 17 @ 10:16 am
What’s amazing about this is that *even with* the downgrades — even with the social service hostages slowly being killed off — Rauner will still win Quincy.
Oakley’s Herald-Whig will still endorse Rauner, and Rauner will still win.
It’s almost as though no one cares what actually happens. All that matters is that Rauner says “Madigan”.
That’s enough. Nevermind the realities. No one actually cares about the realities when it comes to Rauner.
Comment by Mr. K Tuesday, May 23, 17 @ 10:19 am
Isn’t the Quincy School District in the middle of building & rebuilding most of their schools? Hope they got their bonds at the A- rates.
Comment by Highland IL Tuesday, May 23, 17 @ 10:41 am
Municipal bankruptcy would be great for a community that is insolvent.
Comment by Ron Tuesday, May 23, 17 @ 10:46 am
What’s puzzling is the sheer lack of a Democratic narrative against Raunerism and the falsehoods proven by… Oh I dunno… lending rating downgrades.
It’s baffling, actually.
Rauner winning again.
Comment by Oswego Willy Tuesday, May 23, 17 @ 10:48 am
Ron- “Municipal bankruptcy would be great for a community that is insolvent.”
Forcing a municipality or social service agency or school or any entity into having to go through a bankruptcy by denying funds because of:
a. refusing to make payments on contracts awarded
b. withholding GRF funds
c. holding up vouchers at the Agency level
d. creating a situation where Federal funds are lost due to a, b, and/or c
e. All of the above plus other machinations from the Tool Shed
Communities, social service agencies, schools, and others in our State are being forced into insolvency “Because Rauner”. There is no benefit here. Further cutting back on “calories” when someone is already on a hunger or starvation diet does not make you a winner on the “Greatest Loser”. That tactic only places greater stress on an already weakened system leading to collapse, not fitness.
Comment by Anon221 Tuesday, May 23, 17 @ 11:02 am
Anon221, not true. Illinois and many of its municipal governments are insolvent due to decades of overspending and outrageous pensions that are “guaranteed” by an unfair state constitution.
The state has one of the highest state and local tax burdens in the nation right now. Taxes are not the answer. Spending cuts and renegotiating massive debt loads is the solution.
Remember, Illinois is losing people at a faster rate than almost any state right now. Why? Number one reason is our outrageous taxes.
Comment by Ron Tuesday, May 23, 17 @ 11:25 am
Ron, I would appreciate a list of the municipalities that are insolvent. Be careful what you wish for…
http://chicagotonight.wttw.com/2014/12/16/can-cities-illinois-go-bankrupt
Comment by Anon221 Tuesday, May 23, 17 @ 11:32 am
Ron again misses the point.
Comment by Anonymous Tuesday, May 23, 17 @ 11:56 am
Anonymous, I am one of the few here who gets that Illinois has been a sinking ship for decades. Taxes are not the answer, Illinois is losing its population at alarming rates due to our current tax burden.
Comment by Ron Tuesday, May 23, 17 @ 12:25 pm
=Ron=
Maybe we need to go to a progressive tax rate like all the other states are. Higher taxes on the wealthiest 1%?sure work for them.
Comment by So tired of political hacks Tuesday, May 23, 17 @ 12:42 pm
So tired, too bad our obscene constitution doesn’t allow that.
Comment by Ron Tuesday, May 23, 17 @ 1:18 pm
==Maybe we need to go to a progressive tax rate like all the other states are. Higher taxes on the wealthiest 1%?sure work for them.==
All those other states tax retirement income.
Comment by City Zen Tuesday, May 23, 17 @ 1:49 pm
True, but a millionaire tax could be imposed as the voter of Illinois overwhelming voted for.
Comment by So tired of political hacks Tuesday, May 23, 17 @ 1:49 pm
The constitution isn’t obscene - your cognition is.
Comment by VanillaMan Tuesday, May 23, 17 @ 1:53 pm
–Wait. I thought the state had increased funding for K-12.–
Not only that, but the governor has a “balanced budget plan.” I saw him talking about it on the tee vee box, in his sweet, for-real, workshop.
The dude counts on his some of the people, all of the time.
But, geez, he lies so easily, even for a politician.
Comment by wordslinger Tuesday, May 23, 17 @ 2:57 pm
A millionaire tax is unconstitutional in Illinois.
Comment by Ron Tuesday, May 23, 17 @ 3:00 pm
===A millionaire tax is unconstitutional in Illinois.===
So are your ideas on pensions, so there’s that, lol
Comment by Oswego Willy Tuesday, May 23, 17 @ 3:02 pm
==A millionaire tax is unconstitutional in Illinois.==
That’s probably why they were proposing a constitutional amendment to do it genius.
Comment by Demoralized Tuesday, May 23, 17 @ 4:04 pm
Hundreds of illinois school districts issue bonds for a variety of reasons every year.
The deadlock is causing illinois schools hundreds of millions in additional payments. Paid by taxpayers. The same people the governor says he is looking out for.
Comment by JS Mill Tuesday, May 23, 17 @ 4:24 pm
JS, municipal bankruptcy will help a lot.
Comment by Ron Tuesday, May 23, 17 @ 4:29 pm