A bond-rating agency said Thursday that Illinois must enact a budget by May 31 -- the scheduled end of the legislative session -- or the state will be on a path to “unsustainable fiscal challenges” and risk long-term damage to colleges and social-service providers because of unpaid bills.

 

The report by Moody’s Investors Service said approval of the “grand bargain” that includes tax hikes coupled with spending cuts would help the state stabilize its situation. The report noted the bargain is stalled in the legislature.

 

“Illinois is at a critical juncture and its leaders must choose between further credit deterioration and drift without compromise, or the potential for stabilization,” said Ted Hampton, a vice president and senior credit officer for Moody’s.

 

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