CHICAGO (WMBD) — Illinois saw its ninth credit rating upgrade in just over two years on Tuesday.
According to an Illinois news release, Illinois’ rating for general obligation bonds was upgraded by Fitch Ratings. Illinois has currently reached an “A” rating with all rating agencies.
“We are continuing to right the past fiscal wrongs in our state with disciplined fiscal leadership, and credit rating agencies and businesses alike are taking notice of Illinois’ remarkable progress,” Gov. JB Pritzker said. “Another credit rating upgrade means millions saved for Illinois taxpayers in interest—money back in the pockets of our state where it can better serve our residents.”
The ratings measure the credit quality of state bonds, and having a higher bond rating can mean that states can borrow money at a lower interest rate, which can save taxpayers millions of dollars.
According to the Fitch Ratings report on the upgrade, the state’s built-up reserves and the reduction of other liabilities contributed to the rating change.
“In addition to building up reserves, the state has also actively reduced various long-term and budgetary liabilities, most prominently its unpaid bills, and laid a more sustainable fiscal foundation,” Fitch’s report stated. “Illinois reduced its accounts payable balance by approximately $1 billion over the course of fiscal 2023 to less than $500 million, a level the state has not seen in more than two decades and continuing a pattern of using unappropriated surpluses to pay down bills.”
The report also stated that Illinois’ reserves are currently at an all-time high of nearly $2 billion. Illinois can also expect another $138 million from several dedicated revenue streams in the 2024 fiscal year.