S&P threatens downgrade over Illinois budget trouble

Crain's Chicago Business reports:

The outlook for the state of Illinois' credit rating has turned negative, Standard & Poor's Ratings Services warned today in a report.

The credit rating agency affirmed the state's worst-in-the-nation A- bond rating, but its outlook, which had been raised to "developing" earlier this year after enactment of pension reforms, went back to negative.

That means that the state's credit rating could be downgraded within the next two years unless its finances improve, S&P said. A lower credit rating translates into higher borrowing costs.

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