Karen's Feed
Feb 27, 2015

Exclusive: Chicago rating downgrade may end swaps deals – Moody’s

CHICAGO (Reuters) – The downgrade of Chicago’s credit rating by Moody’s Investors Service on Friday could immediately terminate four interest-rate swap agreements, costing the city about $58 million, and could lead to more terminations in the city’s swaps portfolio.

Moody’s in a report noted that its downgrade of Chicago’s credit rating to Baa2 triggered termination clauses in four swaps contracts, used by Chicago to hedge interest-rate risk on its variable-rate bonds. Chicago will be required to pay $58 million penalties if it cannot reach settlement agreements with counterparties on the four swaps contracts, Moody’s noted.

Feb 23, 2015

Chicago pension reform lawsuits put on hold

CHICAGO (Reuters) – Lawsuits seeking to void a law aimed at
shoring up the finances of two Chicago pension funds have been
put on hold pending a ruling by the Illinois Supreme Court on a
law affecting state public retirement funds, participants in the
litigation said on Monday.

City unions and retirees had been seeking a preliminary
injunction to stop the law, which took effect Jan. 1, in Cook
County Circuit Court. Meanwhile, the supreme court announced
last week it will hear lawsuits against the Illinois pension
reforms on March 11.

Feb 20, 2015

Illinois governor makes case to rating agencies on fiscal fix

CHICAGO, Feb 20 (Reuters) – Governor Bruce Rauner is seeking
to persuade credit rating agencies from further downgrading
Illinois’ weak ratings, shortly after presenting his turnaround
budget to the state General Assembly.

The Republican governor spoke with the three major credit
rating agencies about his spending plan and agenda, his office
said late on Thursday. Further downgrades would potentially
boost the state’s already-high borrowing costs.

Feb 18, 2015

Illinois governor’s budget seeks cuts to end structural deficit

/CHICAGO, Feb 18 (Reuters) – Illinois
Governor Bruce Rauner proposed a fiscal 2016 budget on Wednesday
that he said will eliminate a $6.2 billion structural deficit
without relying on higher taxes or borrowing.

Instead, the $32 billion general funds spending plan for the
fiscal year that begins July 1 would dramatically reduce
spending by $6.6 billion, with one-third of the savings coming
from shifting government workers into pension plans with reduced
benefits, according to budget documents.

Feb 4, 2015

Illinois governor lays out controversial agenda

Feb 4 (Reuters) – Illinois Governor Bruce Rauner laid out on
Wednesday an ambitious and controversial agenda that includes
constitutional fixes for the state’s public pension system and

In his inaugural state of the state address, the Republican,
who holds political office for the first time, also took aim at
public labor unions.

Jan 26, 2015

East Coast snow storm delays $1.7 billion of U.S. municipal sales

By Karen Pierog and Lisa Lambert

(Reuters) – U.S. municipal bond market supply shrank on Monday in the face of an East Coast blizzard, with Pennsylvania pushing off a $1 billion general obligation debt sale until next week and cash-strapped Atlantic City delaying a $12 million bond anticipation note deal.

Altogether, issuers postponed $1.7 billion of municipal bond sales, including more than two-thirds of the week’s competitive deal calendar, as what the National Weather Service called a “crippling and potentially historic blizzard” bore down on Wall Street.

Jan 15, 2015

Caesars files Chicago bankruptcy, halted by Delaware judge

WILMINGTON, Delaware/CHICAGO Jan 15 (Reuters) – The
operating unit of Caesars Entertainment Corp, the
largest U.S. casino company, filed for Chapter 11 bankruptcy on
Thursday in Chicago to cut $10 billion of debt, but a Delaware
judge intervened to halt the case before it got started.

The legal standoff marked the opening of a new phase in what
have already been complex and contentious debt negotiations
after the company ran up years of losses.

Jan 13, 2015

New Illinois governor orders spending freeze

CHICAGO, Jan 12 (Reuters) – Illinois’ new governor, Bruce
Rauner, took his first shot Monday at addressing the state’s
crippling financial crisis, ordering all state agencies to
freeze non-essential spending.

State workers were also instructed to turn down office
thermostats and turn off lights to save money when their offices
are not in use, according to a wide-ranging executive order from
the Republican first-time officeholder and former private equity

Jan 12, 2015

Big fiscal mess awaits new Illinois governor

CHICAGO, Jan 12 (Reuters) – Illinois’ new governor, Bruce
Rauner, will begin tackling perhaps the biggest fiscal mess in
the nation, and the worst his state has seen in decades, when he
is sworn in Monday.

But the Republican is offering few details on how he will
proceed and how he plans to fix a political culture in the state
capitol that he described as broken during the campaign.

Dec 30, 2014

Fees, expenses for Detroit bankruptcy hit nearly $178 million

By Karen Pierog and Lisa Lambert

(Reuters) – Detroit’s historic bankruptcy, which officially
ended earlier this month, cost the city nearly $178 million in
fees and expenses for teams of lawyers and consultants,
according to a city court filing on Tuesday.

Jones Day, Detroit’s lead law firm for the biggest-ever
municipal bankruptcy which was filed by the city in July 2013,
billed the most by far, at $57.9 million.