Wednesday, Dec. 4

 

Balanced budget key to financial rating

Moody's downgrades 'outlook' for state because of uncertainty

[DEC. 4, 2002]  SPRINGFIELD -- Gov. Ryan said that although we have taken strong steps to ensure Illinois' sound fiscal health, Moody's Investors Service has revised its rating outlook from "stable" to "negative." The governor says a supplemental bill to restore budget cuts would only make the situation worse.

"We've taken the steps necessary to keep the state on sound financial footing. But Moody's is clearly concerned about the state's ability to move swiftly to balance the budget in the face of a continued weak economy. The $200 million supplemental bill to restore our budget cuts for the next six months without any way to pay for that spending would make that situation worse," Gov. Ryan said.

Ryan noted that Moody's has similarly changed its outlook for 16 other states. Nonetheless, the governor is disappointed that hard-fought efforts to balance the budget during last spring's legislative session may be undone and in the process worsen the state's financial picture.

Moody's did maintain the state's Aa2 credit rating and notes that general obligation bonds like Illinois' are still a "particularly safe investment." But Gov. Ryan notes that the strong credit rating is attributable to his administration's sound budget practices, which means spending must be in line with declining revenues.

"I have no doubt that over the long haul, Illinois' diverse economy will recover from last year's terrorist attacks and the ensuing downturn in the economy. But, in the short term, we must control spending until revenues improve," Gov. Ryan said.

[Illinois Government News Network
press release]


Governor seeks to help United Airlines

[DEC. 4, 2002]  SPRINGFIELD -- Gov. Ryan announced he has called United Airlines to discuss potential state assistance in order to help United obtain a $2 billion federal loan guarantee.

The governor planned to brief the legislative leaders Tuesday on the options to support United in its effort to secure the guarantee from the Air Transportation Stabilization Board.

"Just as I interceded in the negotiation between the Chicago hotels and their union employees over the Labor Day weekend, I have asked United Airlines how the state can assist in its efforts to secure the federal loans in order to save Illinois jobs and protect the Illinois economy," Gov. Ryan said. "There is no question that helping United avoid a bankruptcy filing will save more jobs in Illinois."

The governor said the specific state initiative has not yet been finalized but that he would like the state to do whatever it can to support United so that the federal board knows how well-qualified United is for the loan guarantee and how important United Airlines is to Illinois.

"United Airlines has been an integral part of Illinois' economy for more than 50 years, and now more than ever, given the state's tough economic times, we have to fight to save as many jobs as possible," Gov. Ryan said.

[Illinois Government News Network
press release]

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