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VOL. 22 • NO. 27

Could be first state with ‘junk’ bond rating, due to budget woes

By Dee Longfellow FOR THE ELMHURST INDEPENDENT

The last time Illinois made national news was when Governor Rod Blagojovich was headed to prison; before that, it was Governor George Ryan who was off to serve a term in the Department of Corrections. The state is bipartisan when it comes to prosecuting its governors. Now the state is on the pages of newspapers across the country because it is about to have its credit rating downgraded to “junk” status. What does that mean? If you were paying attention to the financial world back in the 1980s, you may recall some people making it big with “junk” bonds. It’s likely no surprise that this downgrade would deepen its multibillion-dollar deficit and cost taxpayers more for years to come. S&P Global Ratings has warned that they will likely lower Illinois’ creditworthiness to below investment grade, if feuding lawmakers fail to agree on a state budget for its third straight year. That means increasing the amount the state will have to pay to borrow money for things such as building roads or refinancing existing debt. Lawmakers met in Springfield over the weekend for a special legislative session, knowing the July 1 start of the new fiscal year is looming on the horizon. “That should alarm everyone, not

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just those at the Capitol,” said Brian Battle, director at Performance Trust Capital Partners, a Chicago-based investment firm. “It isn’t a political show, everyone in Illinois has a stake in what’s happening here. One day everybody will wake up and say ‘What happened? Why are my taxes going up so much?’” What does it mean for Illinois and its taxpayers? Here’s a look at what’s happening and what a junk rating could mean: Ratings agencies have been downgrading Illinois’ credit rating for a long time, but the process keeps speeding up because there doesn’t seem to be anything that Republican Gov. Bruce Rauner and House Speaker Mike Madigan can agree on. The S&P said the concern is with Illinois’ massive pension debt, along with a $15 billion backlog of unpaid bills. There was also a drop in revenue when lawmakers allowed a temporary income tax increase to expire in 2015. These are facts are raising eyebrows among those who set credit ratings for governmental units. After the Illinois General Assembly adjourned the regular session on May 31, the S&P had this to say: “In our view, the unrelenting political brinkmanship now poses a threat to the timely payment of the state’s

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Illinois makes national news for less than desirable reasons

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THURSDAY, JUNE 29, 2017

Karate lessons offered at City Centre Block to Block Party

DEE LONGFELLOW PHOTO Elmhurst Independent

Surrounded by family members, this little boy listens to the instructor from Park’s Champion Tae Kwon Do before he tries a karate chop to a split a board. It all took place on Wednesday, June 21 at the Block to Block Party held in Elmhurst City Centre by the fountain. The band ‘Rocks Off, a Rolling Stones cover band, performed in the plaza. More photos inside.

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