CHICAGO - Wednesday, Moody's slashed Chicago's credit rating down by three slots to A3, just a step above the triple-B rating. Crain's Chicago Business is reporting that Chicago and a Michigan school district fared the worst among 29 local governments and school systems reviewed by Moody's Investors Service using a new approach to measuring public pension obligations. According to data released by the credit rating agency on Wednesday, the general obligation ratings of Chicago and the Carman-Ainsworth Community Schools fell three notches to A3, just a step above the triple-B category.
The review, which Moody's launched in April, resulted in 18 rating downgrades, with the majority of the ratings falling one notch. Ratings for Virginia, Minnesota, and Michigan's Fruitport Community School District were dropped two notches.
The 29 municipal issuers, which collectively have $12.5 billion of debt outstanding, were placed on review for potential downgrades because they have large pension liabilities relative to their particular credit ratings, Moody's said. ...More HERE