Junk Bond Status Looms Over Budget Impasse
If Illinois lawmakers don’t pass a budget by the end of today, the state is likely to be the first ever to be downgraded to junk bond status by at least one ratings agency. Junk status would indicate investing in Illinois is too risky. Local governments already have to pay a “Illinois penalty” for their own borrowing. That totals about $930 million extra a year. Junk status would only increase that cost. That’ll likely fall on the backs of taxpayers.