Fitch Gives Chicago Another Credit Rating Jolt
From Crain's Chicago Business
Chicago was downgraded three notches today by another credit rating agency, with a negative outlook clouded by pension liabilities and a struggling economy.
Fitch Ratings dropped the city's $8 billion in unlimited tax general obligation bonds to A- from AA-, along with $497.3 million in bonds backed by sales taxes.
The city's $200 million commercial paper notes dropped three notches, to BBB+, from A+, putting them two notches above junk bond status.
The move puts Fitch in line with the rating Moody's Investors Service imposed in July,, when it lowered Chicago's general obligation bonds three notches to A3.
Standard & Poor's Corp. rates the city's debt two notches higher, at A+, but its outlook changed to negative in September.
Fitch said the city's recently proposed 2014 balance budget appears to be “achievable” with a variety of recurring and one-time revenue increases. “However, Fitch will not consider the city's financial operations to be structurally balanced until recurring revenues support recurring expenditures, including actuarially based pension costs,” the agency said.
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From Crain's Chicago Business
Chicago was downgraded three notches today by another credit rating agency, with a negative outlook clouded by pension liabilities and a struggling economy.
Fitch Ratings dropped the city's $8 billion in unlimited tax general obligation bonds to A- from AA-, along with $497.3 million in bonds backed by sales taxes.
The city's $200 million commercial paper notes dropped three notches, to BBB+, from A+, putting them two notches above junk bond status.
The move puts Fitch in line with the rating Moody's Investors Service imposed in July,, when it lowered Chicago's general obligation bonds three notches to A3.
Standard & Poor's Corp. rates the city's debt two notches higher, at A+, but its outlook changed to negative in September.
Fitch said the city's recently proposed 2014 balance budget appears to be “achievable” with a variety of recurring and one-time revenue increases. “However, Fitch will not consider the city's financial operations to be structurally balanced until recurring revenues support recurring expenditures, including actuarially based pension costs,” the agency said.
Read more in our daily News Update...