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Illinois' Bad Credit Costing Taxpayers Millions

Illinois' Bad Credit Costing Taxpayers Millions
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By AP
Jun. 25, 2013 | SPRINGFIELD, IL
By AP Jun. 25, 2013 | 03:41 AM | SPRINGFIELD, IL
Illinois is paying the price - in both dollars and reputation - for years of ignored warnings about its pension crisis.

For decades, lawmaker have skipped or shorted payments to state retirement funds, creating a $97 billion pension shortfall and giving Illinois the lowest credit rating of any state.

That means when Illinois tries to borrow money, the state is treated much like a person with a bad credit score. It gets charged interest rates far higher than its more responsible peers.

This week, Illinois is expected to try to borrow $1.3 billion to rebuild roads and repair Chicago's elevated trains. According to one estimate, taxpayers will pay more than $18 million in annual extra interest for that loan than states with strong credit ratings, such as Virginia or Maryland.




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