Bond rating for Chicago school system is lowered

From The Chicago Tribune: Because of the Chicago Board of Education's troubled financial condition, the Moody's bond-rating agency has downgraded the rating of the school system's general obligation debt to A2 from A1. The district is depleting its cash reserves to deal with a $665 million deficit and faces $338 million in back pension payments that come due in 2014. Moody's also noted that the district must address "a moderate increase in salary costs" associated with a new teachers' contract and will be "hard-pressed" to make the budget adjustments necessary to close an estimated $1 billion budget gap for fiscal 2014.