CHICAGO — The Lombard, Ill., village board rejected a request from its public facilities agency to cover a shortfall in the January debt service payment on a portion of nearly $190 million bonds issued for a hotel and conference center in the village.

While reserves will be tapped as they have in recent years, the village's decision could result in the first payment default for the project's Series B bonds which carry the village's appropriation pledge, market participants warned.

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