Unpaid state bills are mounting and could reach $8.5 billion by the end of 2015, the Illinois comptroller said Wednesday.
Comptroller Leslie Geissler Munger held a news conference at the Edwardsville Holiday Inn Express and Suites on Wednesday to discuss the effects of the continuing budget impasse on state finances and the ramifications for future state payments.
The state’s Democratically controlled General Assembly and Republican Gov. Bruce Rauner have yet to agree on a budget for the fiscal year that began July 1. The two branches have agreed on funding for schools in the state and a court order has dictated all state employees be paid without an approved appropriations bill.
Without a budget in place, the state’s deficit has continued to grow.
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Munger says her office is working under more than a dozen court orders and consent decrees and estimates the state is spending at a level of approximately 90 percent of last fiscal year’s budget.
However, revenues to the state are expected to be down 18 percent, or nearly $2.4 billion, in the first half of the fiscal year, because of the drop in the state income tax rate in January, Munger said.
“All of us who have to manage our own home budgets know when you have lower revenue or income, you need to reduce your spending accordingly,” Munger said. “In our state, that hasn’t occurred.”
Spending is taking place with no regard to what is in state coffers, Munger said. “It’s really a recipe for disaster,” she said.
All of us who have to manage our own home budgets, know when you have lower revenue or income, you need to reduce your spending accordingly. In our state, that hasn’t occurred.
Illinois Comptroller Leslie Geissler Munger on state spending
Payments are still going out seven to eight weeks late, Munger said.
“Our office performs triage everyday,” Munger said, referring to bills that come in.
If the situation continues, she said unpaid bills will amount to $8.5 billion by end of the calendar year.
“Time is of the essence,” Munger said. She said consequences and situation will become more dire without a budget.
“It’s time for the General Assembly to sit down with the governor, find common ground, and pass a balanced budget,” Munger said.
Munger added balancing the state’s budget can be done if departments and agencies pitch in and cut their own costs.
She said employees in her office have been cross-trained and positions haven’t been filled as people left.
“I think every state agency and every government office ought to be looking at how they can cut their budget by 10 percent,” Munger said. “It is not hard if you just go in and start looking for efficiencies.”
$8.5 billion Amount in unpaid bills state is projected to have by the end of the year, if a budget isn’t agreed upon
She added if the state’s economy grew, and businesses were investing, more revenue would come in to the state.
She added the state lost taxpayers in 2014 as the cost of doing business in Illinois is high.
Munger said if there was a tax increase, she would want to see a plan where it would come back down over a period of several years.
She also endorsed reforms Rauner has been pushing, including on workers compensation and property taxes.
She added there need to be cuts in growing costs, including finding a constitutionally acceptable solution to cut pension costs.
Medicaid costs are exploding, Munger added, who said there’s an “inability to tackle exploding Medicaid cost, or unwillingness to do so, to make sure people who are receiving Medicaid… are truly eligible. It’s costing us a lot of money.”