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* Fitch…
Fitch Ratings has assigned a ‘BBB’ rating to the following general obligation (GO) bonds of the state of Illinois:
–$450 million GO bonds series of May 2018A;
–$50 million GO bonds series of May 2018B.The bonds are expected to be sold via competitive bid on April 25, 2018. […]
The Rating Outlook remains Negative.
* Why we’re at where we’re at…
Illinois’ ‘BBB’ IDR and GO rating reflect several years of weak operating performance and fiscal decision making. This has led to a credit position well below the level that the state’s solid economic base and still substantial independent legal ability to control its budget would support.
The Negative Outlook reflects uncertainties related to successful implementation of the current year budget and ongoing fiscal management and decision making, particularly given the contentious political environment in the state.
* A look ahead…
Stabilization of the rating is sensitive to the state’s ability to maintain budgetary balance over multiple years, indicating more sustainable fiscal management. Upward rating momentum is unlikely until the state more comprehensively addresses its accumulated liabilities. […]
A re-emergence of political stalemate that negatively affects fiscal operations, including a material increase in accounts payable, could trigger a downgrade. […]
Illinois has demonstrated a repeated inability to address its structural challenges due to an absence of consensus and resistance among key stakeholders. The political environment in the state remains a negative rating consideration.
posted by Rich Miller
Monday, Apr 9, 18 @ 1:41 pm
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While I appreciate the extra push these rating agencies gave our lawmakers to finally get a budget, aren’t they being a little silly? Illinois is neither going to default nor can go bankrupt. There really is no risk to holding these bonds.
Comment by Radio Flyer Monday, Apr 9, 18 @ 1:48 pm
Why now Fitch? Illinois hasn’t had a balanced budget in decades?
Comment by Ron Monday, Apr 9, 18 @ 1:48 pm
“Stabilization” LOLOLOL HAHAHAHAAH
How much $ is going out the door in late payment penalties? High interest rates?
Some of us want to leave our kids in a better position than we were, and the State of Illinois wants to…..
Comment by 44th Monday, Apr 9, 18 @ 1:55 pm
Too bad that irrevocable continuing approps, exponential revenue coverage and never missing a payment doesn’t factor into “risk” assessment.
You’d think it would.
Comment by wordslinger Monday, Apr 9, 18 @ 1:55 pm
Too bad that for two decades, the constitutionally mandated balanced budget clause has been ignored by the legislature and the courts
But the blame is apparently on the ratings agencies, not the politicians
Comment by Lucky Pierre Monday, Apr 9, 18 @ 1:59 pm
Many of us have been telling Rauner supporters that their man has set Illinois back a decade economically. Fitch just confirmed this.
Rauner raised our taxes, but delivered nothing for it. If he is reelected, he will raise our taxes even higher and Illinois will be set back another decade.
Comment by VanillaMan Monday, Apr 9, 18 @ 2:09 pm
-Rauner raised our taxes-
The General Assembly did
Comment by ste_with a v_en Monday, Apr 9, 18 @ 2:10 pm
===The General Assembly did===
Yep.
The veto…
As the veto also stopped 2 budgets…
That Rauner…
Comment by Oswego Willy Monday, Apr 9, 18 @ 2:11 pm
Illinois has demonstrated a repeated inability to address its structural challenges (PENSIONS) due to an absence of consensus and resistance among key stakeholders (GOVERNMENT UNIONS).
The political environment (MIKE MADIGAN) in the state remains a negative rating consideration.
The Speaker is incapable of being embarrassed by this refusal to do his part to fix Illinois finances that have been neglected under his watch for decades
Comment by Lucky Pierre Monday, Apr 9, 18 @ 2:22 pm
And remmber LP . . . Governor “I’m not in charge.”
He’s a lot of help as well.
Comment by Demoralized Monday, Apr 9, 18 @ 2:34 pm
==inability to address its structural challenges (PENSIONS) ==
You know what addresses that? Paying them. How about focusing on that. After all that’s the only answer.
Comment by Demoralized Monday, Apr 9, 18 @ 2:35 pm
Illinois has demonstrated a repeated inability to address its structural challenges ( regressive tax rate) due to an absence and consensus and resistance among key stakeholders ( The Wealthy)
The political environment ( Governor Rauner) in the State remains a negative rating consideration
The Governor is incapable of being embarrassed by this refusal to do his part to fix an Illinois that he and his wealthy friends have profited from for decades
Fixed it for you, Lucky. You’re welcome
Comment by Redraider Monday, Apr 9, 18 @ 2:44 pm
===Illinois has demonstrated a repeated inability to address its structural challenges (PENSIONS) due to…===
Not paying what’s owed, timely.
===absence of consensus and resistance among key stakeholders (GOVERNMENT UNIONS).===
Members were the ones paying what they owed to the pensions.
You are remedial. Maybe you’re a newer “Lucky Pierre”
===The political environment (MIKE MADIGAN) in the state remains a negative rating consideration.===
Gov. Rauner has yet to sign a budget, the last budget was an override budget by a bipartisan general Assembly, curbing more problems than not having a budget.
===The Speaker is incapable of being embarrassed by this refusal to do his part to fix Illinois finances that have been neglected under his watch for decades.===
LOL…
Put 71 members on the stairs… see what happens.
Of course, you need 71 members, that Rauner doesn’t have, but I digress, lol
Comment by Oswego Willy Monday, Apr 9, 18 @ 2:47 pm
–But the blame is apparently on the ratings agencies, not the politicians–
Why would you say that? It makes no sense at all.
Regardless of deficits, Illinois pays debt service first, by law. All state revenues are dedicated to it, and they provide exponential coverage. That explains why no debt service payments have been missed in good times and bad. It’s other things that don’t get paid.
If Illinois politicians could have figured out a way to short or delay debt service payments, they would have done it by now.
Comment by wordslinger Monday, Apr 9, 18 @ 3:02 pm
Serves us right.
Comment by Groundhog Day Monday, Apr 9, 18 @ 3:06 pm
“Lucky Pierre”
Hmm…
===But the blame is apparently on the ratings agencies, not the politicians===
Mr. Schrimpf?
===“Illinois’ credit rating has been downgraded 13 times under Pat Quinn and now, because of his failed leadership, our state’s economy and finances are still broken. Pat Quinn put special interest politics ahead of Illinois workers. We need to change direction before it’s too late.” – Rauner campaign spokesperson Mike Schrimpf===
Gov. Rauner… you own these, and the crisis that brings them now.
Mike Schrimpf tells me so…
Comment by Oswego Willy Monday, Apr 9, 18 @ 3:16 pm
Except Governor Rauner has been trying to fix the pensions and Mike Madigan and his hand picked candidate for Governor are not
Comment by Lucky Pierre Monday, Apr 9, 18 @ 3:25 pm
Mike Madigan did try to fix the pension problem. He forced through a pension reduction bill that was declared unconstitutional by the Illinois Supreme Court.
That bill probably cost Pat Quinn the election. So we got Rauner.
Comment by Last Bull Moose Monday, Apr 9, 18 @ 4:15 pm
==Except Governor Rauner has been trying to fix the pensions==
If by “fix” you mean attempting to cut people’s pensions then I suppose, yeah, he’s trying to “fix” it.
The fix is to pay it. If he wants a 401K they can do that for new employees at any time.
Comment by Demoralized Monday, Apr 9, 18 @ 4:17 pm
LBM:
The pension “fixers” will not accept that anything is a “fix” unless it cuts the pensions of those currently in the system. Anything short of that isn’t a real “fix” in their mind.
Comment by Demoralized Monday, Apr 9, 18 @ 4:17 pm
===Except Governor Rauner has been trying to fix the pensions and Mike Madigan and his hand picked candidate for Governor are not===
Again.
60/71
Otherwise… Rauner isn’t doing anything.
“Never mistake activity for achievement” - Coach Wooden
Comment by Oswego Willy Monday, Apr 9, 18 @ 4:19 pm
=Except Governor Rauner has been trying to fix the pensions and Mike Madigan and his hand picked candidate for Governor are not=
And yet, for all of his failings, Quinn was actually making the required pension payments and paying down the bill backlog. Continuing that would have gone a long way to getting us on the right track.
And remind me what Rauner’s constitutional “fix” to the pension problem is that Madigan has been holding up?
Comment by Pundent Monday, Apr 9, 18 @ 4:41 pm
Pundent,
I will remind you that It is Culllerton’s constitutional consideration pension fix that a majority of the duly elected Senators voted for
the Governor compromised and supports the Democratic bill, that is supposed to be a good thing- cooperation and professionalism
Time to pay more than lip service to that concept
Comment by Lucky Pierre Monday, Apr 9, 18 @ 5:12 pm
LP, Leader Durkin has had that bill since May of last year and hasn’t added a single House co-sponsor.
Comment by Rich Miller Monday, Apr 9, 18 @ 5:14 pm
===the Governor compromised and supports the Democratic bill, that is supposed to be a good thing- cooperation and professionalism===
Then Rauner should put his HRaunerites on the stairs with Dems, get 60, heck get 71… force Madigan by embarrassing Madigan.
Heck, there were 60 members already signing on a resolution to Rauner’s idea in this session for one thing…
… why can’t Rauner get his 60?
Comment by Oswego Willy Monday, Apr 9, 18 @ 5:15 pm
The idea of “paying” the debt service with more debt is not a solution - it is ” kicking the can”
Finch figured it out
Comment by cannon649 Monday, Apr 9, 18 @ 5:31 pm
The best way to fix pensions is to eliminate them.
Comment by Ron Monday, Apr 9, 18 @ 6:21 pm
===The best way to fix pensions is to eliminate them.===
- Ron -
Paint, sculpt, go for a walk, nap, read a comic… this is the helping or adding.
Comment by Oswego Willy Monday, Apr 9, 18 @ 6:25 pm
OW, why give a small group of people special privileges?
Comment by Ron Monday, Apr 9, 18 @ 8:35 pm
===why give a small group of people special privileges?===
Constitutionally guaranteed.
It’s not a “privilege”
Please. Stop.
Comment by Oswego Willy Monday, Apr 9, 18 @ 8:55 pm
Cullerton’s proposal as modified to please Rauner isn’t Constitutional because it is involuntarily.
One of the other pending pension bills is voluntary … but it won’t save very much money, if any after allowing for the incentive payments. Plus they don’t know if the IRS will buy-in to it .
Broken record … same stuff, different day.
Comment by RNUG Monday, Apr 9, 18 @ 10:57 pm
It’s an outrageous protection that no gets but the kleptocracy.
Comment by Ron Monday, Apr 9, 18 @ 11:12 pm