Chicago Downgraded Again

Ho-hum, another rating service downgrades Chicago.

    Citing the lack of a long-term plan to fund pensions for city police and fire personnel, another financial ratings agency has lowered its credit rating for Chicago city government.

    Standard & Poor’s Ratings Services announced Wednesday it lowered its rating on City Hall’s general obligation bond debt one notch, from ‘A-’ to ‘BBB+’ with a negative outlook. That’s still above its “junk” rating.

    The move follows Moody’s Investors Service rating the city’s debt at junk status in May. The Moody’s downgrade contributed to city taxpayers being forced to accept higher interest rates on a $674 million borrowing deal that occurred shortly after the rating was issued.

Hey, Detroit, make a bit of room there in the Bankruptcy Bin.

Thornton Quarry Tours

For all my friends in Chicago's South Suburbs, you can get tours of the Thornton Quarry, which apparently is due to be filled with water.

Until the water starts flowing, however, the MWRD is taking groups to see the dry reservoir. Various delegations from neighboring communities have visited, and Spyropoulos said that if interested groups contact her office, it will arrange a tour. I carefully explained, several times, that if you put a thing like that in the paper, people will actually do it. But she insisted that’s OK. So for next month or so, now’s your chance. Because it’ll be under water a long, long time. Though if you do go, a word of advice: Bring sturdy boots. Because Brad Sutter won’t let you in otherwise. 

To schedule a tour, contact the MWRD Office of Public Affairs at tours@mwrd.org or phone 312-751-6633.

Chicago Downgraded to 'Junk'

Well, not the city, just its bonds.

Moody's downgraded Chicago's credit rating down to junk level "Ba1" from "Baa2." 

The announcement, which the ratings agency released Tuesday afternoon, cited a recent Illinois court ruling voiding state pension reforms. Moody's said it saw a negative outlook for the city's credit. 

Following that May court decision, Moody's said it believes that "the city's options for curbing growth in its own unfunded pension liabilities have narrowed considerably."

That court decision is explained here.

On Friday, the Illinois Supreme Court ruled that pension reform legislation passed in 2013, commonly referred to as Senate Bill 1, violates the pension protection clause of the Illinois Constitution. The Court upheld a previous circuit court ruling that invalidated the law in its entirety. The Court held that the State could not rely on its inherent “police powers” to diminish the benefits of membership in a pension system. 

While I think the decision is disastrous for the state, it also seems to be on solid legal grounds. The section of the Illinois constitution in question reads:

Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.

That seems pretty clear.

It also seems pretty clear that this is going to end badly.

Update: Five Reasons Chicago Is in Worse Shape Than Detroit

Will the Obama Library (and the Obamas) Desert Chicago for New York?

Apparently the Obamas are strongly considering settling in NYC when he leaves office, and the Obama Library may quite possibly be located at Columbia instead of the U of Chicago, which had seemed a lock. Note the reasons (emphasis added):

Barack and Michelle Obama are seriously considering moving to New York after his presidency, and building the Obama Library at the city’s Columbia University, sources told BuzzFeed News. 

Columbia’s bid on the library — and the notion of the Obamas in New York — has been widely viewed as a kind of courtesy to the Big Apple, with the universal assumption among even the Obamas’ inner circle that the couple would move back to Chicago in January 2017. But sources familiar with the process said their thinking has changed in recent months, the result both of messy Chicago politics and a personal craving for a new beginning when they leave the White House for the last time as residents. The first family fears the Chicago they left is not one they want to return to, and a source close to the family said the long-shot New York library bid has emerged as a serious alternative.

What, Chicago's too screwed up for the Obamas? That's funny.

Goose Island

I was a little surprised to find Goose Island beer for sale at a convenience store in Show Low, Arizona. (Or maybe it was Pinetop -- anyway, it was somewhere where they read the White Mountain Independent).

I have fond memories of Goose Island (the island, not the beer). My office, for almost ten years, was at the south end of the Halsted Street bridge, with the island at the north end. I would usually cross the bridge for lunch, because there was a greasy spoon diner at a Greyhound maintenance depot just at the end of the bridge. Great cheeseburger/fries and nice folks. Since we were next to the notorious Cabrini Green projects, there weren't a lot of high-end dining choices.

The Goose Island Brewery was very trendy at the time. My daughter tells me it has been bought by Anheuser-Busch, which explains why it has wider distribution; she adds that it has also lost much of its cachet.

Another Reason for Employers to Leave Illinois

Not that they need more, given the state's high taxes and its impending collapse from pension overload. But Governor Pat Quinn has just imposed another absurd  rule:

Governor Bars Employers From Asking Applicants About Felony Records