Moody's Investors Service has downgraded to Baa1 from A2 the rating on Oak Lawn, IL's outstanding general obligation unlimited tax (GOULT) debt. The village has $61.6 million in GOULT debt outstanding. The outlook is negative.
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The downgrade to Baa1 reflects a narrow financial position combined with the village's very high and growing unfunded pension liabilities and sizeable gap between current pension funding levels and amounts that would keep unfunded liabilities from growing further. The rating also incorporates the village's sizable suburban tax base located twenty miles southwest of downtown Chicago (Ba1 negative) and its broad legal flexibility to raise local revenue.
