Chicago Earned 10 Credit Upgrades in Late 2022

The City’s 10th rating upgrade over the last 3 months brings all City’s ratings to investment grade and is yet another testament to the City’s financial turnaround

Moody’s Investors Service (Moody’s) has upgraded the City of Chicago’s General Obligation (GO) Debt to a Baa3 rating. This upgrade marks the first upgrade the City of Chicago has received from Moody’s in 12 years.  The Moody’s upgrade of one notch from Ba1 to Baa3 brings every City of Chicago rating to an investment grade and serves as an independent acknowledgment of the tremendous financial accomplishments of the City to stabilize its finances…

“The City’s 10 upgrades from independent rating agencies and investment grade ratings across the board is external proof that the City has turned around its finances,” said Jennie Huang Bennett, Chief Financial Officer. “These upgrades are evidence that the City’s financial strength is not just focused in one or two areas but rather the financial improvements are being acknowledged across the city as a whole.”

Moody's also acknowledges the significant stabilization of the City's pension funds through increases in pension funding, the new policy that makes an advance pension payment and begins to pay down on the City's pension credit card. "Adoption of the [new pension funding] policy follows the elimination of a number of other debt-based budget relief maneuvers that Chicago had relied on, marking a decisive shift away from an era where the city balanced budgets at the cost of a deteriorating balance sheet." […]

These Moody’s upgrades are just the latest of 10 rating upgrades the City has achieved since August 2022. 

1. August 2022: Fitch Upgrades Chicago’s O’Hare General Airport Revenue Bonds (GARBs) to ‘A+’ from ‘A’.   

2. August 2022: S&P Upgrades Chicago’s O’Hare GARBs to ‘A+’ from ‘A’. 

3. August 2022: S&P Upgrades Chicago’s O’Hare Passenger Facility Charge (PFC) revenue bonds to 'A+' from 'A'. 

4. October 2022: Fitch Upgrades Chicago’s General Obligation (GO) Bonds to ‘BBB’ from ‘BBB-’ and upgraded their Outlook to ‘Positive’ from ‘Stable’. 

5. October 2022: Fitch Upgrades Chicago’s Sales Tax Securitization Corporation (STSC) Bonds to ‘AA’ from ‘AA-’ and upgraded their Outlook to ‘Positive’ from ‘Stable’. 

6. November 2022: Fitch Upgrades Chicago’s Water Revenue Bonds to ‘A’ from ‘A-’ and upgraded their Outlook to ‘Positive’ from ‘Stable’. 

7. November 2022: Fitch Upgrades Chicago’s Sewer Revenue Bonds to ‘A’ from ‘A-’and upgraded their Outlook to ‘Positive’ from ‘Stable’. 

8. November 2022:  Moody’s Upgrades Chicago’s General Obligation (GO) Bonds to “Baa3” from “Ba1,” with a ‘Stable’ Outlook. 

9. November 2022:  Moody’s Upgrades Chicago’s Water Revenue Bonds to ‘Baa1’ from ‘Baa2,’ with a ‘Stable’ Outlook. 

10. November 2022:  Moody’s Upgrades Chicago’s Senior Lien Sewer Revenue Bonds to ‘Baa1’ from ‘Baa2,’ with a ‘Stable’ Outlook and Junior Lien Sewer Revenue Bonds to ‘Baa2’ from ‘Baa3,’ with a Stable Outlook. 

Read more from the City of Chicago: https://www.chicago.gov/city/en/depts/mayor/press_room/press_releases/2022/november/FirstMoodysInvestmentGradeUpgrade12Years.html