Illinois' already-low credit rating takes another hit due to budget impasse

The Chicago Tribune reports:

Illinois' worst-in-the-nation credit rating took another hit Thursday as Moody's Investors Service issued another bond downgrade citing the record-breaking budget impasse that it said has left the state "increasingly vulnerable."

With the downgrade, the state's general obligation bond rating on approximately $26 billion in debt now stands at Baa2, down from Baa1. That's two notches above junk status. Construction bonds, as well as those for the expansion of the Metropolitan Pier and Exposition Authority, also were knocked down a notch to Baa2.

The move comes as the state plans to go to market this month to borrow another $550 million, which the ratings agency also assigned a rating of Baa2. The changes effectively mean that Illinois will pay more money to borrow.

"The rating downgrade reflects continuing budget imbalance due to political gridlock that for more than a year has kept Illinois from addressing revenue lost due to income tax cuts that took effect in January 2015," the agency said in a report.

No word yet on this story from Barack Obama , who worries a lot about the Republican party.