March 26 (Reuters) – Two of the nation’s most distressed
big-city school districts issued general obligation bonds this
week, with very different results.
The junk-rated Philadelphia School District borrowed at
investment-grade levels thanks to a state intercept program. But
the higher-rated Chicago Board of Education paid a whopping 4
percent over the SIFMA Index on variable rate bonds – about five
times more what it paid than two years ago.
SPRINGFIELD, ILL, March 11 (Reuters) – A pension reform law
passed in 2013 is necessary to protect public health and safety
and should stand despite restrictive language in the state
constitution, Illinois’ solicitor general said at a high-stakes
supreme court hearing on Wednesday.
Prohibiting reform “would tie the state’s hands when its
need to act is most pressing,” Carolyn Shapiro told the court in
an opening statement.
CHICAGO (Reuters) – Illinois may be fighting an uphill battle on Wednesday in defending the constitutionality of a 2013 public pension reform law before the state supreme court.
Illinois justices will hear the state’s appeal of a Nov. 21 county court ruling that tossed out the law. In the ruling, Sangamon County Judge John Belz drew on an unrelated state supreme court opinion that found the Illinois Constitution makes it “plain” and “unambiguous” that pensions cannot be reduced.
By Karen Pierog
(Reuters) – Issuers of municipal bonds should be required to
adhere to certain accounting standards to enhance transparency
in the $3.7 trillion U.S. muni market, U.S. Securities and
Exchange Commissioner Dan Gallagher said on Tuesday.
In a speech at a Financial Industry Regulatory Authority
conference in New York, the Republican commissioner said that
just over two-thirds of the nation’s 30,000 biggest state and
local government bond issuers incorporate practices recommended
by the Governmental Accounting Standards Board (GASB). He added
that the 20,000 remaining smaller issuers probably have a lower
rate of compliance.
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.
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.
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.
/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 (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.
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.