Moody’s Investor Service downgraded Rockford’s debt rating from A1 to A2.
The group says the downgrade reflects the city’s high pension burden, as well as greater operating costs and a limited ability to raise revenue. The Rockford Register Star reportscity officials say the lack of home rule authority limits the ability to raise such revenue. The lower rating likely will increase overall borrowing costs.
By comparison, Illinois's rating of Baa3 is one step above junk status. The report says city bonds could be once again upgraded if there is growth in general fund reserves, expansion of the tax base, and rising socioeconomic indicators.