CHICAGO (AP) — Chicago’s credit rating took another hit with the decision by Standard & Poor’s to lower the rating of the city’s general obligation bonds two notches to A- from A+, still investment grade.
Standard & Poor’s action Thursday follows a decision earlier this week by Moody’s Investor’s Service to lower Chicago’s credit worthiness to junk status.
The lower credit ratings increases the cost of the city’s borrowing.
Standard & Poor’s cited Moody’s action in its decision. The rating agency said Chicago Mayor Rahm Emanuel’s plans to convert debt with fluctuating interest rates to fixed-rate bonds to help stabilize city finances could be jeopardized by Moody’s action.
Like Moody’s, Standard & Poor’s referred to last week’s Illinois Supreme Court decision overturning a state pension overhaul.
Emanuel has called Moody’s downgrade “irresponsible.”
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