Mendoza begins paying down bill backlog
Wednesday, Nov 8, 2017 - Posted by Rich Miller
* Press release…
Illinois Comptroller Susana A. Mendoza moved quickly today to use proceeds from Illinois’ recent General Obligation bond sale to begin paying down a major portion of the state’s current $16.7 billion backlog and, critically, stop the clock on a mountain of interest payments accruing on Illinois’ late bills, some dating back to 2015.
Comptroller Mendoza said she will initially prioritize those bills eligible for federal matching funds to maximize the revenues available from the $6 billion bond sale. The action will significantly reduce the state’s record bill backlog and, importantly, end the accrual of interest penalties as high as 12% annually on many of the state’s oldest obligations.
The state owes an estimated $900 million in late payment interest penalties on its bill backlog. The bond sale effectively refinances future interest costs on the state’s existing debt, saving taxpayers billions of dollars over the next decade.
“As the state’s chief fiscal and accountability officer, I’m laser focused on maximizing this opportunity for taxpayers,” Comptroller Mendoza said. “These payments will effectively stop the bleeding of late payment interest penalties on this portion of the backlog. There is still a long, hard road ahead of us, but this is a vital first step toward smart planning for FY2019 and beyond.”
In total, the Office of the Comptroller expects to receive about $6.48 billion in bond proceeds, including a $480 million premium from the sale on top of the $6 billion initially offered, an indicator of the strong market demand for the bonds.
About $2.5 billion will be spent immediately on unpaid medical bills. Close to $4 billion will be used to pay down unpaid state health insurance claims owed to medical providers in the coming days. Over the next several weeks, an additional $2 billion in federal matching funds will be applied to state medical bills.
“Through the use of federal matching funds, we expect to turn a $6.48 billion bond offering into a nearly $9 billion investment which initially targets our state’s struggling healthcare system and medical providers, many of whom have had to turn to third parties for loans just to stay afloat,” Comptroller Mendoza said.
* From yesterday…
- Anonymous - Wednesday, Nov 8, 17 @ 1:56 pm:
This woman has a future in politics. I’d hate to see it go to waste in Illinois.
- U2 - Wednesday, Nov 8, 17 @ 2:16 pm:
I am thankful for Comptroller Mendoza. She is sharp as a tack and has her priorities in the right order. Her expertise may help future bond sales and confidence that IL is finally taking some serious steps to get out of this huge backlog of bills. I also believe Treasurer Frerichs is good for IL. I hope these two elected officials continue to prove to be worthy of the faith and trust of the citizens of the State of Illinois. “Thoughts and Prayers!”
- Blue dog dem - Wednesday, Nov 8, 17 @ 2:19 pm:
Maybe she should have been razor focused as a state rep when the state was spending so much.
- Henry Francis - Wednesday, Nov 8, 17 @ 2:27 pm:
The state owes an estimated $900 million in late payment interest penalties on its bill backlog.
This is disgusting. And so much of it was avoidable.
- wordslinger - Wednesday, Nov 8, 17 @ 2:50 pm:
–Maybe she should have been razor focused as a state rep when the state was spending so much. –
Yeah, give Rauner a pass for his “leverage” strategy working just as he planned it for 2.5 years.
- Texas Red - Wednesday, Nov 8, 17 @ 2:54 pm:
So the state now has (some) money, and Mendoza will take steps to see that (some) bills get paid. What a novel idea.
- City Zen - Wednesday, Nov 8, 17 @ 3:08 pm:
==Maybe she should have been razor focused as a state rep when the state was spending so much.==
You can count how many balanced budgets she voted for on one fist.
- jim - Wednesday, Nov 8, 17 @ 3:14 pm:
Another Mendoza press release. this will drive Treasurer Frerichs out of his mind.
- wordslinger - Wednesday, Nov 8, 17 @ 3:20 pm:
–So the state now has (some) money, and Mendoza will take steps to see that (some) bills get paid. What a novel idea.–
Apparently so, in most GOP circles.
If you’ll recall, it took a few years for a few of them to summon the courage to buck Rauner’s deadbeat/squeeze the beast play to make it happen.
If they hadn’t, the state would have blown past the $20B in overdue bills by now.
- Norseman - Wednesday, Nov 8, 17 @ 3:44 pm:
With the exception of some initial stumbles, Mendoza is really hitting her stride. You can tell by the inane comments from the trolls.
- Blue dog dem - Wednesday, Nov 8, 17 @ 4:35 pm:
No passes for rauner if you havent noticed. He spends money like a Chicago Dem.
- Shemp - Wednesday, Nov 8, 17 @ 4:56 pm:
She should try spending time running her own office. TIF reporting forms didn’t get out this year until days before the reports were due. They were due back to the Comptroller in late October yet as of this week, they Comptroller’s office still isn’t taking them. AFR reporting was late this year to for those on May 1 fiscals. Her office is a mess. Should stick to minding her own office before politicking. Anyone holding her up as some sort of heroine is buying the full fluff job.
- wordslinger - Wednesday, Nov 8, 17 @ 5:00 pm:
–She should try spending time running her own office. –
Paying bills isn’t part of the job? Thought it was a big one.
She must not have gotten the memo on the TPS report cover sheets.
- Blue dog dem - Wednesday, Nov 8, 17 @ 5:13 pm:
Shemp. You make some valid points. I know its bigboy politics, but she is a smidge over the top for me. I voted for her(but then I voted for Rauner),but wish she’d tone it down a bit.tone
- wordslinger - Wednesday, Nov 8, 17 @ 5:16 pm:
–I know its bigboy politics, but she is a smidge over the top for me. I voted for her(but then I voted for Rauner),but wish she’d tone it down a bit.tone–
What in the release above offended your delicate sensibilities?
- Shemp - Wednesday, Nov 8, 17 @ 5:33 pm:
Yes, collecting and reviewing municipal TIF reports and Annual Financial Reports is the equivalent of TPS reports. You don’t have to defend everything that goes on in Illinois government not touched by Rauner.
- 37B - Wednesday, Nov 8, 17 @ 5:34 pm:
I’ve got to confess that I have a huge political crush on the Comptroller. She is a Democrat cloaked (literally) in Topinka Red. She backs down to no one (ask Quarters Boyle). She communicates effectively about the most pressing issue of her office (reducing the ruinous Rauner 12% debt). I think she’s got “it.” I would not be surprised if she ends up sitting in the Big Chair someday.
- VanillaMan - Wednesday, Nov 8, 17 @ 5:50 pm:
The idea that we have a governor who deliberately stiffed our businesses for political leverage is repellant and criminal.
Rauner cares about businesses about as much as he cares about taxpayers or the lives of our unborn.
- 37B - Wednesday, Nov 8, 17 @ 6:28 pm:
Rich:
Was my comment bounced or did I fail in the transmission?
- Blue dog dem - Wednesday, Nov 8, 17 @ 8:15 pm:
Word. I kinda like to think that we taxpayers are starting to pay down bills. I realize politics is about blowing your own horn at times. Thats why I couldnt ever get into politics
- Sonny - Wednesday, Nov 8, 17 @ 9:34 pm:
I think you could do it.
- kibbit - Thursday, Nov 9, 17 @ 9:23 am:
nice work.
- Wiseguy - Thursday, Nov 16, 17 @ 5:22 pm:
We can all find reasons to criticize politicians as we look under the rocks, and that’s fair. They asked to be in the fishbowl and are subject to the rude gaze of public scrutiny. Nevertheless, this was a wise move, initially suggested by the Treasurer, which reduces interest to a fraction of what it otherwise would be, albeit still a large number. It’s real progress, but not perfection.