Global rating's agency, Moody's Investors Service has announced its decision to downgrade general obligation rating for Cook County to A1 from Aa3 due to concerns over its increasing pension liabilities.

The credit ratings agency also said that it has maintained the negative outlook on the lower rating due to difficulties by the county for obtaining necessary pension reform through the state legislature. The agency said that the pension contributions were lower than the actuarially required contributions in the county.

Cook County recorded an unfunded pension liability of $5.6 billion as of the 2012, the liabilities are expected to rise to about $12.7 billion even under conservative estimates. Cook County, which is the est in Illinois and the second largest in the United States, shares about half of its tax base with Chicago leading to long term overlapping pensions.

Chicago and Cook County require an approval form the state legislative in order to bring reforms to their pension systems. The Illinois lawmakers have not been able to bring a solution to the state's $100 billion unfunded pension liability.

"The General Assembly's legislative paralysis to date with respect to enacting its own pension reforms may further delay the county's attempt to present a reform package, despite having a significantly developed plan," Moody's said in a statement.