News Summary: Illinois' bad credit costs millions

News Summary: Failure to fix pension crisis hurts Illinois' credit rating, costs millions

Associated Press

UNFUNDED: Largely because of its unfunded retirement plans, Illinois has the lowest credit rating of any state. So when it tries to borrow money, it faces far higher interest rates.

DRIVING UP COSTS: For example, in a $1.3 billion bond sale to improve highways, rebuild an old elevated train line in Chicago and buy land for an airport, the state will pay roughly $18 million in extra interest each year than states with high credit ratings.

INACTION: Even after two major credit-rating agencies downgraded the state to an all-time low, lawmakers could agree only to form a bipartisan committee to keep working on the problem. The inaction is costing not only the state, but also local governments, public universities and other entities, whose borrowing costs are rising.

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