The Chicago Tribune is reporting, “Illinois had its bond rating downgraded to one step above junk by S&P Global Ratings, the lowest grade that it’s given to a U.S. state on record, as a long-running political stalemate over a budget shows no signs of ending.
The company warned that Illinois is at risk of losing its investment grade status, an unprecedented step for a state that would only deeper the government’s financial strain. S&P said debt backed by funds that are subject to the legislature’s approval, including those issued by its sports authority, were cut to BB+, one step into junk.
“The rating actions largely reflect the severe deterioration of Illinois’ fiscal condition, a byproduct of its stalemated budget negotiations, now approaching the start of a third fiscal year,” S&P analyst Gabriel Petek said in a statement. “The unrelenting political brinkmanship now poses a threat to the timely payment of the state’s core priority payments.”
READ MORE at the Chicago Tribune.