After Pension Reform Signed, S&P Improves Illinois' Rating Outlook
Standard & Poor's Ratings Services on Tuesday revised the outlook on Illinois' A-minus credit rating to developing from negative due to the state's passage of long-awaited pension reform last week.
The credit ratings agency said the revision to developing, an unusual outlook designation for a state, indicates that Illinois' rating could be raised or lowered during a two-year horizon.
“Although we view the consensus achieved by Illinois on this difficult issue as positive from a credit standpoint, the developing outlook reflects the implementation risk - legal and budgetary - associated with various provisions of the pension reform as well as the overall structural budget challenges facing the state,” S&P analyst Robin Prunty said in a statement.
Illinois' sweeping reforms to its public retirement system, which were signed into law by Governor Pat Quinn on Thursday, are aimed at easing a $100 billion unfunded pension liability that has been squeezing out funding for core state services.
Join the Discussion
After you comment, click Post. You can enter an anonymous Display Name or connect to a social profile.