* AP…
Illinois is chasing a moving target as it tries to dig out of the nation’s worst budget crisis, and a review obtained by The Associated Press shows $7.5 billion worth of unpaid bills — as much as half the total — hadn’t been sent to the official who writes the checks by the end of June.
Although many of those IOUs have since been paid, a similar amount in unprocessed bills has replaced them in the last three months, Comptroller Susana Mendoza’s office said Monday. That’s in addition to $9 billion worth of checks that are at the office but being delayed because the state lacks the money to pay them.
The mound of past-due bills tripled over the two years Republican Gov. Bruce Rauner and Democrats who control the General Assembly were locked in a budget stalemate, which ended in July when lawmakers hiked income taxes over Rauner’s vetoes.
In some cases, agencies were waiting to send their receipts to Mendoza because lawmakers haven’t approved the spending. For example, the Department of Corrections had $471 million in unpaid bills on hand as of June 30 largely for that reason.
Wait. What?
* The comptroller sent a letter to legislators this morning. From that letter…
• What amount of bills held at the agencies lack appropriation authority?
Agencies cannot send the Comptroller vouchers to pay for expenditures that lack an appropriation. If services are being rendered without a sufficient appropriation, then those bills sit at the agency until an appropriation is ultimately made. All the while, these unappropriated expenditures may accrue late payment interest penalties, and the vendors providing those services suffer as they await payment. As evidenced by the report, the information disclosed does not reveal any status relative to appropriation authority or if sufficient authority even exists.
A breakdown of appropriated versus unappropriated liabilities gives lawmakers, the public and the Comptroller an idea of what can actually be paid and where appropriations are not covering the services being delivered.
* From Rep. Dave McSweeney…
As of June 30th, Governor Rauner’s Administration has been holding about $7.5 billion of bills at state agencies, which is making our fiscal problems worse as late payment interest penalties continue to accrue. Also, it appears that the Rauner Administration is holding bills for Fiscal Year 17 that have not been appropriated. For example, a significant portion of the Department of Corrections $471,821,889 liability appears to be unappropriated.
The Rauner Administration needs to immediately provide the General Assembly with a full accounting of unappropriated Fiscal Year 17 bills, which appear to be substantial. With approximately $16 billion of unpaid bills, Governor Rauner’s fiscal record is abysmal.
We need more transparency in state Government. As a strong fiscal conservative, I will be voting to override Governor Rauner’s veto of Comptroller Mendoza’s HB 3649. HB 3649 is a common sense bill that will require monthly reporting of all bills being held by state agencies. I’m also a recently added Chief Co-Sponsor of that legislation.
* Meanwhile…
- Montrose - Tuesday, Oct 10, 17 @ 10:12 am:
So, does that mean that the unpaid bill amount was around $22 billion when they finally passed a budget? i.e. $15 billion at the comptroller’s office and $7.5 billion sitting in the agencies? I’m trying to get my head around this math.
- wordslinger - Tuesday, Oct 10, 17 @ 10:12 am:
By what authority does anyone in the executive branch get to green light “unappropriated spending” of any amount, much less a “significant portion” of $471M?
I assume that’s not spending required by court order, which merrily rolled along for a couple of years without appropriation.
Is this just more contracts the administration signed and then vetoed the appropriations to pay them, like with social service providers?
- The Captain - Tuesday, Oct 10, 17 @ 10:16 am:
There’s the unappropriated spending at corrections that we were predicting here in the comments last year. I’m not sure how you manage to spend money without the legal authority to do so in a way that doesn’t constitute fraud but I’m sure the law enforcement entities will review that carefully.
However if I was a candidate for high office looking to grandstand today I’d issue a press release calling for an investigation.
- RNUG - Tuesday, Oct 10, 17 @ 10:17 am:
The bill added transparency to State spending and debt. Something Rauner has claimed he wants, and is apparently spending a ton of money on software to get.
So why did Rauner veto it? The logical assumption is he doesn’t want an accounting of his spending and cash management practices. Or at least he wants to keep.that hidden until after the election.
The veto should be overridden and Mendoza should aggressively pursue getting the best numbers possible on the State’s fiscal position.
- Norseman - Tuesday, Oct 10, 17 @ 10:21 am:
=== Is this just more contracts the administration signed and then vetoed the appropriations to pay them, like with social service providers? ===
That would be my assumption, Word. A lot of folks warned that this Rauner action would lead to a horrible problem. It was clearer in the social service setting, but the IOUs were running rampant throughout the impasse.
Instead of giving Rauner the pat on the back he gave himself for keeping the doors open during the impasse, we need to give him a kick in the pants and send him packing.
- Ghost - Tuesday, Oct 10, 17 @ 10:35 am:
If agency directors were spending without an appropriation, ie enter into contracts without authority…. shouldn’t they be fired? That conduct is unlawful, they do not have authority to spend without an appropriation.
- RNUG - Tuesday, Oct 10, 17 @ 10:50 am:
== If agency directors were spending without an appropriation, ie enter into contracts without authority…. shouldn’t they be fired? That conduct is unlawful, they do not have authority to spend without an appropriation. ==
I’ve maintained all along that the State was fraudulently entering into contracts by misleading the contractors with promises of payment. There hasn’t been a lot of success in sueing the State over these actions because it is really hard to prove it was fraudulent.
It probably won’t go anywhere, but I would be nice if someone would introuce a bill removing soviergn immunity for instances of fraud like this.
And yes, I realize the chaos this could cause because it was / is standard operating procedure to renew a lot of fiscal year contracts before a budget is finalized and appropriations passed.
- cdog - Tuesday, Oct 10, 17 @ 10:55 am:
Why were these expenditures not appropriated in the obviously faked-balance budget?
In a competent budget it seems there would be line for “prior year payables still outstanding.”
Not in Illinois, where we do bad really good.
sigh…Vouchergate continues.
(post re-written to comply with filter.
… sorry if it shows up twice.)
- anon2 - Tuesday, Oct 10, 17 @ 10:56 am:
I respect honest conservatives like Rep. McSweeney who call a spade a spade, even when it means allocating blame to a Republican.
- Shemp - Tuesday, Oct 10, 17 @ 11:22 am:
I know some services must go on, but how does $7.5 billion get spent legally without an appropriation?
- Anonymous - Tuesday, Oct 10, 17 @ 12:45 pm:
==I’ve maintained all along that the State was fraudulently entering into contracts by misleading the contractors==
Those contracts all have a clearly “subject to appropriation clause. If vendors want to enter into contracts with that express requirement, knowing the situation the last two years, that’s up to them.
- RNUG - Tuesday, Oct 10, 17 @ 1:00 pm:
== Those contracts all have a clearly “subject to appropriation clause. If vendors want to enter into contracts with that express requirement, knowing the situation the last two years, that’s up to them. ==
But if the State people negotiating the contracts are whispering “just ignore that clause, we’ll take care of you” … I’ve heard that some people have been promising the sun and the moon just to get necessary supplies delivered.
- Honeybear - Tuesday, Oct 10, 17 @ 1:30 pm:
See I can’t wait to look at data compiled by Martire that shows how the velocity of money was slowed for the whole state by stuffing our own contractors
How much better would we be if that money had be released into our economy on time?
- Arthur Andersen - Tuesday, Oct 10, 17 @ 2:19 pm:
Honeybear, the Illinois GDP in 2015 was $775 billion. I don’t think the State’s slow pay practices will turn out to have had macroeconomic effects, but we’ll see.
To the Post, how does McSweeney conclude that much of DoC’s $471m 6/30 balance was not appropriated? Not from the Comptroller’s letter, in which she acknowledges in the first graph that “many of the bills have been paid” and that the information presented is of limited use. Frankly, the letter is more a pitch for a veto override than an objective analysis.
- Anonymous - Tuesday, Oct 10, 17 @ 2:21 pm:
==But if the State people negotiating the contracts are whispering “just ignore that clause, we’ll take care of you” … I’ve heard that some people have been promising the sun and the moon just to get necessary supplies delivered.==
If they’re giving more weight to what they’re told vs what’s in black and white, then they’re getting terrible legal advice. Again, on them, and no fraud case would hold up.
- Responsa - Tuesday, Oct 10, 17 @ 3:03 pm:
I hope that reporters will continue to ask both McSweeney and Mendoza to explicate on these alleged non-appropriated “appropriations”. Because it is not clear from the AP piece or this post exactly what they are alleging occurred, or the amounts involved, or who specifically they are alleging authorized/caused the bills to be rendered. These bills need to be separated from the legitimately appropriated bills that are being held due to there being insufficient money to pay them.
- RNUG - Tuesday, Oct 10, 17 @ 5:03 pm:
== If they’re giving more weight to what they’re told vs what’s in black and white, then they’re getting terrible legal advice. Again, on them, and no fraud case would hold up. ==
What if they are being told they will never do business with the State again?
- Chicago Barb - Tuesday, Oct 10, 17 @ 6:23 pm:
Anonymous, the social service providers are told if you don’t sign the contract, someone else will. When you have been providing a critical service to people for many years, you don’t want to let go longtime staff , who have built bonds with their clients, so you sign the contract and hope for the best.