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* According to the governor’s office, there are “sufficient dedicated revenues to cover the payments” on this borrowing…
Gov. Bruce Rauner’s administration plans to borrow $480 million this month to pay for construction projects.
The state plans to conduct the general obligation bond sale on Jan. 14, Rauner spokeswoman Catherine Kelly said Sunday. The money would be used for road and transit projects and to pay related costs, she said.
“Road construction and transit improvements are key factors in growing the Illinois economy, which is why Illinois is planning a bond sale in January,” Kelly said in a statement.
She noted that despite the impasse that’s left Illinois without a complete budget since July 1, the three major credit rating agencies have not lowered the state’s general bond rating. First-term Republican Rauner wants pro-business, union-weakening legislation opposed by Democrats, who are allied with trial lawyers and organized labor.
No word yet on where the money will be spent, which ought to be pretty interesting.
posted by Rich Miller
Monday, Jan 4, 16 @ 8:39 am
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Yes we need capital. However, The Administration owes an analysis of the increased cost of borrowing due to the manufactured financial crisis.
Comment by Austin Blvd Monday, Jan 4, 16 @ 8:45 am
Rich, I’ve heard from reliable sources 95% will be spent on a huge warehouse for the turnaround agenda.
Comment by How Ironic Monday, Jan 4, 16 @ 8:46 am
So, no budget, but borrowing monies for construction, at an unknown interest rate, due in large part to Rauner’s own failure to be governor and craft and pass a budget.
To the political;
“You help me, ‘this’ gets built”
I have no problem with that, but I’m confused. Isn’t that business as usual and not shaking up Springfield or bringing back Illinois?
Will these construction projects have Anti-Union, anti-prevailing wage provisions by “local” actors?
Lots of questions, but if this is just a plain o’ “you do this, legislator, you get this constructuon project” lever, I have zero problem.
The problem could be what is given, to get what is needed.
Comment by Oswego Willy Monday, Jan 4, 16 @ 8:47 am
Good. Someone or something has to keep things moving forward as much as possible while this impasse plays out.
Comment by Too Little Too Late Monday, Jan 4, 16 @ 8:59 am
=== the three major credit rating agencies have not lowered the state’s general bond rating ===
A nice nuanced response. Last I saw, the budget crisis due in large part by Rauner’s hostage taking resulted in the following actions from two ratings agencies.
“Fitch Ratings on Monday downgraded Illinois’ rating on $26 billion in outstanding bonds because of the crisis …” AP, October 19, 2015 http://www.chicagobusiness.com/article/20151019/NEWS02/151019818/fitch-downgrades-illinois-credit-rating-citing-budget-fight
“New York, October 22, 2015 — Moody’s Investors Service has downgraded the State of Illinois’ $26.8 billion of general obligation bonds to Baa1 from A3, while also lowering ratings on the state’s sales-tax (Build Illinois) bonds to Baa1 from A3, and on the state’s subject to appropriation bonds (issued by the Metropolitan Pier and Exposition Authority and for the state’s Civic Center program) to Baa2 from Baa1. The outlook for all of these obligations remains negative.” https://www.moodys.com/research/Moodys-downgrades-Illinois-outstanding-27B-of-GO-bonds-to-Baa1–PR_337211
Comment by Norseman Monday, Jan 4, 16 @ 9:27 am
At least the RAUN Man promised a competitive bidding process on the bonding.
Comment by blue dog dem Monday, Jan 4, 16 @ 9:44 am
- Too Little Too Late -
It’s not an “impasse”.
No budget until the Turnaround Agenda is passed.
Please, keep up. Thanks.
Comment by Oswego Willy Monday, Jan 4, 16 @ 9:49 am
Is Rauner Team going with the idea that we can operate a state, with the secretly desired intervention of the courts, without a budget, forever?
Now that’s new politics! You never have to actually announce or support either a spending cut, or a tax increase. You just “do what we can.”
Comment by walker Monday, Jan 4, 16 @ 10:07 am
and my tin foil hat comment…. the gov reached agreements with the unions involved in these kinds of projects, and suddenly is finding a way to fund them…..
Comment by Ghost Monday, Jan 4, 16 @ 10:09 am
That sure sounds like a lot of construction for Lincolnshire . . .
Comment by Henry Francis Monday, Jan 4, 16 @ 10:16 am
“… The money would be used for road and transit projects and to pay related costs, she said.
“Road construction and transit improvements are key factors in growing the Illinois economy, which is why Illinois is planning a bond sale in January,” Kelly said in a statement…”
Most likely this is to pay for the State’s share of federally funded construction projects, which, generally, is 20% of the cost.
If they hadn’t swept the MFT funds from IDOT, most of this money would have been available.
Comment by Anonymous Monday, Jan 4, 16 @ 10:20 am
So, this is the Rauner show? I’m curious why he doesn’t want a capital bill that would, in theory, be bi-partisan that everyone could bask in the glory of. Or am I thinking of something else?
Comment by Cheswick Monday, Jan 4, 16 @ 10:49 am
“No honey, I know what I’m doing! We can take out these loan offers to fix our roof, replace the septic, and buy a new mower - THEN, we sit down and do a budget to see how we’ll find money to get groceries!”
“Trust me, I know what I’m doing this time…”
Comment by VanillaMan Monday, Jan 4, 16 @ 10:55 am
Congratulations Lincolnshire! You just won 6 miles of road resurfacing.
Comment by siriusly Monday, Jan 4, 16 @ 11:23 am
Another hostage released.
How many are left now? Just universities, the poor, the sick, the infirm and Syrian refugees?
So revealing. See you in church.
Comment by wordslinger Monday, Jan 4, 16 @ 11:39 am
Any thing for school repairs?
Comment by mokenavince Monday, Jan 4, 16 @ 11:51 am
Has Rauner changed his mind about zeroing out the Illinois chapter of the National Alliance on Mental Illness (NAMI)?
Comment by Independent retired lawyer, journalist Monday, Jan 4, 16 @ 1:54 pm
=== Is Rauner Team going with the idea that we can operate a state, with the secretly desired intervention of the courts, without a budget, forever? ===
Yes, until:
- the Dems quake in their boots and give in to Rauner’s anti-union demands;
- the sycophantic editorial boards jump ship and start criticizing him for holding the budget hostage;
- the rating agencies start blaming Rauner personally for the future credit downgrades; or,
- the GOP takes the majority in the General Assembly.
Comment by Norseman Monday, Jan 4, 16 @ 2:43 pm
Norseman: LOL
I was being a bit snarky. You slapped me scared.
Comment by walker Monday, Jan 4, 16 @ 4:15 pm
I am sort of surprised no one has yet to offer up the “divide and conquer” strategy of splintering Union opposition. State Construction spending(or lack of) is a critical néed of the trade unions,I.e., laborers,operators, steel workers, carpenters,etc…we all know that these unions have little if no loyalty to the public service unions and vice verse. This just happens to coincide with the RAUN Man coming to contract terms with many unions, but not all. Withhold construction spending another six months, and watch the dominos crumble.
Comment by Blue dog dem Monday, Jan 4, 16 @ 6:51 pm
These items all are budgeted for. Passed by the General Assembly and signed into law by Governor Rauner for FY16.
Comment by The Machine Tuesday, Jan 5, 16 @ 10:09 am
“If they hadn’t swept the MFT funds from IDOT, most of this money would have been available. ”
Also false.
Comment by The Machine Tuesday, Jan 5, 16 @ 10:11 am