Moody's joins Fitch in downgrading Illinois credit

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Associated Press

SPRINGFIELD, Ill. (AP) - A second major rating agency is downgrading Illinois' credit worthiness.
   
Moody's Investors Service lowered the state's $27 billion in outstanding bonded indebtedness to A3 from A2. The new rating's three levels above junk status.
   
Illinois already has the worst credit rating among the states.
   
Fitch Ratings downgraded Illinois' credit on Monday.
   
Both firms blame lawmakers' lack of action on a $97 billion shortfall in its public-employee pension systems.
   
The Legislature adjourned its spring session without adopting a plan to make up the difference over 30 years.
   
Moody's says its rating "assumes the government will not take action to reduce the state's pension liabilities any time soon."
   
A credit-rating downgrade means it costs the state millions more to borrow money when it sells future bonds to finance long-term construction projects.

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