Ill. bond sale scuttled because of downgrades
Illinois delays borrowing $500M because recent credit downgrades would have increased interest
SPRINGFIELD, Ill. (AP) -- Illinois officials have delayed borrowing $500 million for construction projects because the pension crisis makes the state's debt more expensive.
Abdon Pallasch is spokesman for Gov. Pat Quinn's budget office. He says a bond sale scheduled for Wednesday was postponed after potential bidders warned of an "unsettled" market.
Blame the ongoing quandary over how to reduce a $96 billion deficit in Illinois public-employee pension accounts. Standard & Poor's is the latest credit agency to downgrade the state's credit worthiness because of the pension mess.
S & P also gave Illinois a "negative" outlook -- reflecting the Legislature's "poor track record" on solving the pension-liability problem.
Pallasch says the bond sale will be rescheduled after markets review the situation. The bond sale was to fund school and transit projects.
