By CARL GREEN
Springfield, IL – Throughout Illinois’ years of financial struggle under both Democratic and Republican governors, one constant concern was the state’s bond ratings, which seemed to keep dropping no matter what happened, making big state construction projects more expensive.
So it was a big relief this summer when three major ratings services – Standard & Poors, Fitch Ratings and Moody’s Investor Service – actually upgraded Illinois’ ratings in recognition of the government’s improved financial performance.
ROADS AND CONSTRUCTION
Illinois Comptroller Susana Mendoza said the upgrades show Illinois is moving in the right direction. “Upgrades are good news because they mean lower costs for taxpayers on the bonds we use to build roads, bridges, schools and other projects,” she said.
State Sen. Rachelle Crowe (D-Glen Carbon) said the upgrades mean state borrowing will cost less, saving taxpayers money. “A win for Illinois taxpayers, the upgrades signal our state is making responsible budgetary decisions,” she said.
Added Sen. Christopher Belt (D-Swansea), “This is another example that shows our state is working diligently to restore what has been broken in the past. I want to thank our state’s leaders and my colleagues as we have set Illinois on the path to a brighter future.”
MOVING IN THE RIGHT DIRECTION
The ratings still aren’t at the top, but the trend in the right direction is strong. In July, Moody’s upgraded General Obligation bonds from Baaa3 to Baaa2, with a stable outlook. The Metropolitan Pier and Exposition Authority rating went from Baaa3 to Ba1 with stable outlook. Build Illinois bonds were upgraded from Baa3 to Baa2.
In June, Fitch had revised its outlook on Illinois General Obligation bonds from negative to positive.
Fitch said the new, balanced state budget is a stable foundation for further improvement, following debt payments and a reduction in spending of close to $1 billion without cutting funding for pensions or education – which Fitch said suggests responsible budget management and fiscal stability.
Standard & Poor’s followed Moody’s with its first upgrade of Illinois general obligation bonds in 25 years, from BBB- to BBB, with a stable outlook.
Gov. J.B. Pritzker said the upgrades are a result of his work with the Legislature to hold the line on spending and make smart investments.
“I promised to restore fiscal stability to Illinois, and the ratings upgrades demonstrate that Illinois’ finances are headed in the right direction for the first time in two decades,” he said.
The last time Illinois’ ratings were downgraded was during the budget stand-off between the Legislature and former Gov. Bruce Rauner.