Illinois pays price for budget uncertainty in $500 million bond offering

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(Bloomberg)—Illinois’s fiscal woes are making borrowing more costly for the worst-rated U.S. state as its leaders attempt to avoid a repeat of the record budget impasse last year that pushed its bond rating to the precipice of junk. The state sold $500 million of general-obligation bonds on Wednesday in a competitive auction won by Bank of America Corp. A portion of the deal that matures in May 2042 with a 5 percent coupon sold at 4.87 percent, or 1.86 percentage points more than those on benchmark securities, according to data compiled by Bloomberg.