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Social service groups lose court case, considering an appeal

Wednesday, Aug 31, 2016

* Press release…

Pay Now Illinois, a coalition of 97 Illinois-based human and social service agencies and companies, said today that it will consider an appeal of Cook County Circuit Court Judge Rodolfo Garcia’s denial of their request for immediate preliminary injunction and full payment of unpaid contracts dating back to July 1, 2015. While the judge dismissed the coalition’s suit against the State of Illinois, he also urged that their breach of contract suit be expeditiously appealed to a higher court for resolution.

In his ruling, Judge Garcia contended that a trial court was not the right setting for the case.

“We are disappointed with the ruling, but heartened by the Court’s recognition of the irreparable harm that has been caused in Illinois and by the Judge’s comment that our case deserves to be heard at a higher level,” Pay Now Illinois Chair Andrea Durbin said.

“From the beginning this lawsuit has been about good business practices – paying signed contracts in full and on time. The State’s failure to pay – and their belief that there is no way to make them pay – sets an extraordinarily bad precedent that should be of concern to anybody doing business with the state. It calls into question whether any contracts in the state are valid.”

Pay Now Illinois had sought a preliminary injunction for emergency relief that would require the state of Illinois to begin immediate payment on contracts that were more than 60 days in arrears. The motion for injunction was deemed necessary because of the devastating and irreparable harm being caused to plaintiffs who are facing a cascade of damages – laying off staffs, curtailment of essential programs, or entirely shuttering their programs, all of which seriously impedes their ability to serve their clients.

The original lawsuit filed on May 4, 2016 against Illinois Governor Bruce Rauner, Illinois Comptroller Leslie Munger and the directors of six statewide agencies – one agency has since been added – claimed that the state’s failure to pay invoices on services performed under signed contacts was an unlawful impairment, or interference, with the agencies’ constitutional right to a legal remedy for the non-payment of these contracts. The suit further charged that the Governor and other state officials have acted illegally by failing to make payments on contracts while continuing to enforce them.

“It’s important to remember we are seeking full – not partial – payment on our contracts,” said Durbin who is also CEO of Illinois Collaboration on Youth (ICOY). “For the State of Illinois to be considered a desirable business partner, it has to show that it honors its contracts in full. Right now, that is not the case.”

- Posted by Rich Miller        

18 Comments
  1. - Oswego Willy - Wednesday, Aug 31, 16 @ 6:37 pm:

    If you’re a Social Service contractor, advocate, benefactor, or understand what “squeeze the beast” means…

    … Vote Accordingly.

    ===“For the State of Illinois to be considered a desirable business partner, it has to show that it honors its contracts in full. Right now, that is not the case.”===

    The… business decision… to destroy social services is a choice of a man spending $16 million he controls.

    Raunerites want to continue the practice of hurting the most needy and those groups, organizations, and affiliations missioned to help those less fortunate or need care only these groups provide.

    How do I know? This case is still not settled.

    Vote Accordingly. November 8th. No quarter. The Rauners aren’t giving their monies to make sure this continues. Show the Rauners you’re paying attention.

    OW


  2. - Norseman - Wednesday, Aug 31, 16 @ 6:55 pm:

    I feel for all these folks with the exception of ounce, but I doubted that they had much of a chance with their lawsuit. Hope they prove me wrong with the appeal.

    Good luck!


  3. - Matt Vernau - Wednesday, Aug 31, 16 @ 7:14 pm:

    Standard Contract language for Illinois includes a clause that says something to the effect that if there is no money the state will not pay you. Rauner, Munger, et alia have chosen not to pay for this work. It may be time to quit doing the work for free. There is no such thing as a fair fight and you can not win playing by someone else’s rules.


  4. - RNUG - Wednesday, Aug 31, 16 @ 7:23 pm:

    I’m going to be interested in the eventual outcome of this. I’ve thought for some time the only hope was to prove deliberate intent / conspiracy to breach any contract and not pay. With his suggestion to appeal it, it sounds like this judge things there might be something to that claim … but for now, the judge played safe and followed existing precedent.


  5. - Huh? - Wednesday, Aug 31, 16 @ 7:35 pm:

    Shouldn’t this lawsuit been filed in the court of claims rather than a regular court?


  6. - CCP Hostage - Wednesday, Aug 31, 16 @ 8:17 pm:

    In a normal world, when there are insufficient appropriations, one does not issue a contract, which is fair. What is unfair is issuing a contract and blocking any way for the contract to be paid, all the while enforcing every other provision. And that is what is happening here. If there’s no appropriation, don’t contract. Simple if it is simply a financial matter. Which it is not.


  7. - RNUG - Wednesday, Aug 31, 16 @ 8:19 pm:

    == Shouldn’t this lawsuit been filed in the court of claims rather than a regular court? ==

    If your claim is just that you are owed the money and not paid, then Court of Claims is correct. If you are going to claim deliberate and intentional after the fact breach of contract, then the courts leading to the Illinois Supreme Court is the right venue.


  8. - RNUG - Wednesday, Aug 31, 16 @ 8:28 pm:

    - Matt Vernau -

    You could argue that an appropriation was made, albeit one insufficient to properly fund all obligations. Over my 30+ years in state government, I only saw the non-appropriation contract language invoked once … and that was on a big bucks item that had its’ own line in the agency budget, and said line item was deliberately zeroed out after submission in the General Assembly budget process.

    So my take on it is if the ENTIRE line wasn’t zeroed out or if the specific contracted service by name wasn’t submitted on an individual budget line and then zeroed, an appropriation existed and the non-appropriation clause is no defense for non-payment. It may sound like I’m splitting hairs but that is how I’ve seen it done in the past.


  9. - cards rule - Wednesday, Aug 31, 16 @ 8:36 pm:

    typical crap! political judgment obviously.


  10. - DuPage Dave - Wednesday, Aug 31, 16 @ 8:40 pm:

    I’m not convinced that the Rauner gang did any of this deliberately, if only because their collective understanding of state government is very limited. However when the social service agencies crumbled they shed no tears and spoke instead of a necessary shake out. (I’m paraphrasing Rodogno here so if someone has the exact quote please jump in.)

    If your general goal is to cause disruption and disorder and you don’t care who gets hurt, you don’t have to have a specific intention to cause a lot of trouble.


  11. - RNUG - Wednesday, Aug 31, 16 @ 8:54 pm:

    - DuPage Dave -

    If you give credence to tue social service agency stories that the Rauner administration begged, pleaded, and promised eventual payment if the agencies would just continue to deliver services in spite of no budget, that I believe you have a basis for a claim of deliberate fraud / intentional breach of contract. I don’t think incompetence is a valid legal defense; the State as originator of both the budget and the contract had a responsibility to know if said contracts would be paid.


  12. - Mama - Wednesday, Aug 31, 16 @ 9:35 pm:

    I hope social services win at the next level. Social Services are important and they should be held hostage for Rauner’s political games against Madigan.


  13. - RNUG - Wednesday, Aug 31, 16 @ 9:40 pm:

    -Mama-,

    Given past precedent, most judges aren’t going to go out on a limb and rule for the service providers; they figure such a decision is beyond their job level. It’s going to go all the way to the IL SC.


  14. - Opinion? - Thursday, Sep 1, 16 @ 12:06 am:

    Link to the ruling?


  15. - Huh? - Thursday, Sep 1, 16 @ 5:16 am:

    “the State as originator of both the budget and the contract had a responsibility to know if said contracts would be paid.”

    I know in my agency, we don’t sign contracts (agreements) unless there is a funded line item in the current fiscal budget from which the consultant or contractor will get paid.

    So I think that it was willful to ask the social services to continue working without a budget and not knowing if the money would be available to pay for the work.


  16. - Last Bull Moose - Thursday, Sep 1, 16 @ 7:20 am:

    The contract language is tight. Oral agreements or promises outside the contract are specifically excluded from the contract.

    While the service providers appeal, the GA should start hearings. There needs to be a political solution.


  17. - 618er - Thursday, Sep 1, 16 @ 7:53 am:

    - Last Bull Moose -
    “There needs to be a political solution”

    Just spit balling here, but do you mean like an officer of the executive branch submitting a budget, and certain individuals of the legislative branch debating and passing said budget, appropriating funds to pay the contracts said executive or his representatives enter into? That kind of political solution?


  18. - RNUG - Thursday, Sep 1, 16 @ 9:18 am:

    == The contract language is tight. Oral agreements or promises outside the contract are specifically excluded from the contract. ==

    But the State signed it without a budget / appropriation in place … that’s the basis for a claim of deliberate fraud.


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