The state of Illinois' credit rating has been downgraded, again.
Moody's Investor Services lowered the city's credit rating on Thursday by one level to "Baa1." Moody's, which also gave the state a negative outlook, said the downgrade was due to Illinois' nearly four-month-old budget impasse, unfunded pension liabilities and unpaid bills.
Republican Gov. Bruce Rauner and Democratic legislative leaders remain at odds over a budget for the 2016 fiscal year, which began July 1.
Thursday's downgrade comes after Fitch Ratings dropped the state's credit rating by one notch on Monday. Fitch Ratings also raised conerns over the Illinois budget stalemate and "continued deterioration of the state's financial flexibility."
UPDATE 1 (5:13 p.m.): House Speaker Michael Madigan released the following statement in response to the latest downgrade news:
Two credit downgrades in the same week are certainly nothing to claim victory over and nothing to ignore. These downgrades will have direct consequences on state taxpayers. The interest rate on future debt repayment will be higher, costing taxpayers more for the foreseeable future.
Yet despite the Fitch Ratings downgrade Monday, Governor Rauner has insisted on moving ahead with his agenda, which would damage middle-class families' standard of living and drive down wages, despite the clear lack of support for his agenda from Democrats and Republicans alike.
With its own credit downgrade Thursday, Moody's made it very clear that what the state needs to do is focus on eliminating our budget deficit, creating a long-term plan to fund the state's pensions and reducing the state's bill backlog.
We all want economic growth, more business investment and more good-paying jobs for hard-working families in every part of Illinois. That is not in question. These priorities can be achieved through a state budget that takes a balanced approach with some spending cuts and some new revenue, not by slashing services and programs that families count on.
The biggest issue facing Illinois is the state budget deficit. Two credit downgrades in less than a week have driven home that important fact. So I urge the governor, again, to put aside his agenda that Democrats and Republicans alike oppose - an agenda that will hurt middle-class and struggling families - and instead focus on a budget that helps all Illinoisans.