CITY OF CHICAGO SECURES FIRST FITCH RATING UPGRADE IN NEARLY 13 YEARS

CITY OF CHICAGO SECURES FIRST FITCH RATING UPGRADE IN NEARLY 13 YEARS

CHICAGO — Mayor Lori E. Lightfoot announced that
Fitch Ratings (Fitch) upgraded their long-term ratings for the City
of Chicago’s General Obligation Bonds (GO) by one notch from
“BBB-” to “BBB” with a positive outlook. The positive outlook
signals that Fitch believes there is potential for further upgrades
over the next one-to-two-year period. This upgrade and positive
outlook illustrate Fitch’s confidence in the financial plan that the
City has laid out and made good on over the last three years and
the prospects for continued improvement in the City’s finances in
the years to come.

This is also the first GO rating upgrade ever by Fitch due to
the improved financial performance of the City in 24 years. The
2010 Fitch upgrade of the City was due to a global methodology
change to all credits nationally. The City’s rating has been BBBfor
nearly seven years since the last downgrade in 2016. The City
estimates that these rating upgrades will save approximately $100
million in savings per $1 billion borrowed. The City borrows
approximately $1-2 billion per year.

The City’s key financial accomplishments over the last three
years include:

Pensions: For the first time in the City’s history, the City paid
all four pension funds on an actuarially determined basis and, for
the first time in 15

Casino: After three decades of pursuit, the City has secured
a casino operator in the City of Chicago that will generate $4
billion of financial value to the State of Illinois: $2 billion to fund
up the City’s police and fire pension funds and $2 billion to the
State of Illinois to support the capital plan.

Debt: For the first time in decades, the City is now paying
down the full freight of its debt annually. Since the start of the
Mayor’s administration, the City will reduce debt outstanding
by $747 million by fiscal year-end 2022.

Budget Gap: The FY2023 budget gap is the second
lowest budget gap in 16 years and achieved structural balance
through a reduction in reliance on one-time measures.

Water: The City has secured the first new preliminary
water supply contract in three decades with the City of Joliet
which will generate $1 billion of financial value and will be
the second largest water partner to the City.

O’Hare: O’Hare International Airport is the only airport
in the country to come out of the pandemic with higher ratings
than it had going into the pandemic.

Investments: The City has made $6 billion in investments
in the City’s future, including $3.3 billion in the Chicago
Works Plan from 2021 to 2024, $1.2 billion in the Chicago
Recovery Plan, and $1.4 billion in public and private investment
commitments over the first two years of INVEST South/
West.

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