O’Hare Bonds Downgraded

The cost of debt is going up because of years of bad management.

A major credit rating firm delivered a stern warning Monday regarding the mounting risks that Chicago is taking by going deeper into debt in an attempt to build more runways at O’Hare International Airport without securing financial support from the airlines.

Moody’s Investors Service downgraded to a “negative” outlook from “stable” some of the revenue bonds that the Chicago Department of Aviation has issued to help pay for the $15 billion O’Hare Modernization Program and related projects.

(Full story here.)

The city needs to borrow another $1 billion in order to keep expansion alive.  Because of the downgrade, the interest rate is going up.  Interest on a billion adds up fast.

Less money for necessary services; more money to debt service.