Illinois' credit rating has been downgraded to the worst in the nation by Standard and Poor's. The credit rating agency dropped the state's rating down to an A- today, stating that Illinois' pension woes are the main catalyst for the downgrade.

“We assessed what the pension fund status is, what the pension funding levels are, and is there a likelihood there’d be significant change on that front," a credit analyst with the rating agency told the Chicago Sun-Times. Only way that can happen is legislative action, and our view is we don’t expect significant change. The past two years, they’ve been discussing pension reform, and there hasn’t been action.”

After the lame duck session ended with no action on the state's underfunded pension system, Fitch Ratings put Illinois on the negative watch list.

Today's move by S&P comes as the state is set to go out on the market with a $500 million bond issue next week.

UPDATE 1 (6:38 p.m.): The We Are One Coalition, which yesterday invited Quinn and legislative leaders to a pension summit scheduled for February, released the following statement in response to the S&P's downgrade:

"Today, Standard & Poor's warned lawmakers that unconstitutional pension cuts would invite ‘legal challenges’ and cause ‘several years’ of budget uncertainty. Our state's legislative leaders and governor must not ignore this call to work with our union coalition to develop a pension-funding solution that is constitutional, fair, and supported by all parties. We Are One Illinois repeats its call for a pension summit to begin such a process."