Standard & Poor’s Ratings Services has downgraded Chicago one notch to triple-B plus from A-minus, predicting that a “structural imbalance” will lead to “corrective budget measures over several years,” the Wall Street Journal reported yesterday. S&P said “in our opinion, the city has not yet fully identified a credible plan” to address the imbalance. S&P removed the rating, which is now three notches above junk, from CreditWatch. The rating firm has a negative outlook. In May, Moody’s Investors Service cut its rating on Chicago’s debt by two notches to junk, citing expected increases in unfunded pension burdens after a ruling by the Illinois Supreme Court that overturned state pension changes.
