As state's credit rating tumbles, McCombie blames it all on 'stubbornness and arrogance'
Operating without a state budget for nearly a year just created another headache for Illinois as the state’s credit rating went from bad to worse.
Moody's Investors Service just issued another bond downgrade today, knocking the state’s bond rating on $26 billion in debt down to Baa2 from Baa1. Swimming in seemingly insurmountable debt, Illinois, which has the worst credit of all 50 states, now sits at a rating that is just two spots above “junk” status.
Construction bonds, and bonds for the expansion of the Metropolitan Pier and Exposition Authority were also downgraded to Baa2.
Moody’s noted that Illinois’ backlog of bills will likely exceed a record high of $10 billion in coming months.
In fact, Illinois’ financial forecast is so grim that BlackRock, the world’s largest money manager, is calling for market participants to stop investing in Illinois bonds, Bloomberg reported.
The development couldn’t come at a worse time for the state as it plans to borrow another $550 million for capital projects next week. What this means for the financially strapped state is that borrowing money will cost the state even more.
“The budget impasse has gone on long enough and our legislators need to quit blaming each other and get back to work!” Savanna Mayor and Republican House candidate Tony McCombie told Rock Island Today. “They need to realize the consequences of their game playing (are) causing hardship to all of us, but most importantly our most vulnerable, our seniors and our children.”
McCombie, who hopes to beat incumbent Mike Smiddy in the District 71 House race, added that the “stubbornness and arrogance” of state legislators is causing damage beyond repair that will affect Illinois for years to come.
“The majority cannot continue doing the same thing year after year and expect a positive result,” she said. “And the Republican minority needs to find a new way to sell reform because the Democrats are not buying a common-sense approach.”
So far all attempts to pass a budget have fallen flat. Just last week, the Illinois Senate shot down Gov. Bruce Rauner’s stopgap funding plan that could have provided some much needed financial relief to schools and state-funded agencies struggling to keep their doors open.
This week, House Speaker Mike Madigan (D-Dist. 22) canceled a planned House session despite having said representatives would meet weekly through June to get a budget passed before the new fiscal year starts next month.
Rauner said Madigan and his followers are to blame for the state's tumbling credit rating.
"When the General Assembly adjourned without passing a balanced budget, the administration warned the supermajority in the legislature there would be consequences," Catherine Kelly, a spokeswoman for Rauner's office, said in a statement. "Every rank-and-file Democrat who blindly followed the speaker down this path is directly responsible for the downgrade."
Today's bad news came as state Comptroller Leslie Munger issued a press release warning that hardship caused by the budget impasse will expand greatly if Springfield doesn't pass a budget by July 1.
She pointed out that $23 billion in existing spending for schools, 911 call centers, domestic violence shelters, federally funded social and human services, and higher education will come to a complete halt next month without a new budget.
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