American Airlines and United Airlines agreed with Chicago on a scaled-back $1.17 billion expansion plan for O’Hare International, ending a legal battle over growth at the nation’s second-busiest airport.
Chicago, whose credit ranking has been cut by Fitch Ratings twice in less than three months, is delaying next week’s $804 million bond sale, said Pete Scales, a spokesman for Chief Financial Officer Gene Saffold .
Tax-exempt bonds had their worst monthly returns of 2010 as rising U.S. Treasury yields and record state and local fixed-rate debt sales sparked withdrawals from mutual funds investing in municipal securities.
Chicago and San Antonio, the third and seventh most-populous U.S. cities, are selling a total of $750 million in Build America Bonds amid an Internal Revenue Service audit of previous sales of the taxable securities.
Chicago’s next mayor will take over a city that is almost out of cash after Richard M. Daley spent most of the $3.5 billion gained from leasing parking meters, garages and a 7.8-mile elevated toll road.
Chicago, whose credit ranking has been cut by Fitch Ratings twice in less than three months, is borrowing $487 million, including $423 million in taxable Build America Bonds, to improve and expand the city’s water system.