Illinois Comptroller Judy Baar Topinka is warning of “a $2 billion collapse” next year when the state’s temporary income tax increase begins to roll back. […]
Topinka likens the decrease to a “heart attack” to state finances. She says she’d rather see it phased out over two years to give lawmakers time to cut spending.
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The state’s fiscal year ended June 30 with the state having 46,000 unpaid bills at the Comptroller’s Office and an estimated bill backlog of nearly $5 billion, Topinka said, “which doesn’t sound all that bad when you consider it often hovers around $8 [billion] or $9 billion. My goodness, only in Illinois would a $5 billion bill backlog qualify as good news.”
Still, Topinka cautioned, tax revenues are allowing the state to pay bills, and then reality will set in again.
“The backlog is at a low point right now, but we expect it to rise again throughout the summer and into the fall,” she said. “We’re in this position more than three years after the largest tax increase in Illinois history. That tax increase is set to sunset at the end of this year and there is no plan to address the lost revenue.”
Topinka warned that if no action is taken, Illinois will have a $2 billion revenue collapse this fiscal year and face a $6.8 billion budget hole next year.