* AP late yesterday…
The Illinois state comptroller reports that the amount of late charges the state has incurred on billions of dollars in debt outstrips the amount accrued in the previous two decades.
Comptroller Susana Mendoza said in a report obtained by The Associated Press Monday that Illinois has run up late-pay fees of $1.14 billion since mid-2015. That’s $100 million more than in the previous 18 years combined.
Illinois must pay 12 percent annual interest on bills not paid within 90 days. The backlog ballooned to $16 billion last summer after a two-year budget stalemate between Republican Gov. Bruce Rauner and Democrats who control the General Assembly.
* Mendoza press release…
“The fact that, under Governor Rauner, the state allowed its bill backlog to grow to a point where we incurred nearly two decades worth of late payment interest penalties in just over two years is asinine,” Comptroller Mendoza said. “Imagine what that money could have done to improve conditions for residents at the Quincy Veterans Home, build roads and other infrastructure or fund public schools. This puts a massive price tag on missed opportunities due to a failure in leadership. Going forward, my Office will continue to pursue a legislative agenda that stresses accountability and requires the Governor to address these costs and tell taxpayers how he plans to cover them.”
* Graph…
* Press release…
The Illinois House overwhelmingly approved a measure State Rep. David McSweeney (R-Barrington Hills) sponsored to get a better accounting of what the State wastes in late payment interest penalties. […]
Rep. McSweeney worked with the State Comptroller’s office to craft a bill that would add more transparency to the State budgeting process. Beginning with Fiscal Year 2019, House Bill 5814 requires the Governor’s budget to include an estimate of late payment interest penalties for the fiscal year. The Governor’s Office of Management and Budget must also compile in their annual report an estimate of all the late interest payment projections for the following four fiscal years. The bill further provides that late interest payments will not be paid if a Chief Procurement Officer has voided the underlying contract or if the Auditor General is conducting an audit and the State Comptroller is holding the contract for review.
That’s a good idea.
* Pritzker campaign…
“Bruce Rauner starved critical state agencies of funding, holding programs to support Illinois’ working families hostage and devastating countless lives, only to rack up over $1 billion in fees on the backs of Illinois taxpayers,” said Pritzker campaign spokeswoman Jordan Abudayyeh. “Bruce Rauner is a billion dollar failure who fiscally mismanaged this state by historic proportions.”
- Sir Reel - Tuesday, Apr 24, 18 @ 10:49 am:
Illinois must pay 12%. I wonder if this is law or court order. Former could be changed.
- 44th - Tuesday, Apr 24, 18 @ 10:50 am:
1% a month late fees = 12% a year. State could issue bonds at much less and pay bills on time and save the difference between 12% and the bonds %…. Not complicated personal finance math, but in our state this S show goes on and on.
- Oswego Willy - Tuesday, Apr 24, 18 @ 10:53 am:
If “Pat Quinn failed”, and Rauner has rung up debt in a two year period that is proportionally rung up during an…
18 year
… period… Bruce Rauner has failed Illinois.
What will be different in a second term, another billion dollars late and held hostage for a map?
- 44th - Tuesday, Apr 24, 18 @ 10:56 am:
Sir Reed, its a law. Also, many vendors sell their receivables to investors who then collect the 12%. This is the program: https://www2.illinois.gov/cms/About/VendorPayment/Pages/default.aspx
- Anon0091 - Tuesday, Apr 24, 18 @ 11:02 am:
What a complete and utter waste of taxpayer dollars. Accomplished zero, other than to reinforce how badly Rauner has failed.
If they had taken 10% of this pile, we could have at least had an amazing bonfire of cash.
- Norseman - Tuesday, Apr 24, 18 @ 11:03 am:
A record Rauner negative accomplishment. Vote accordingly.
- wordslinger - Tuesday, Apr 24, 18 @ 11:04 am:
If only Rauner had gotten everything in his “Turnaround Agenda” passed.
By his own accounting, that $12 billion he piled on to the backlog of bills would have been eliminated via growth in just a short, short 24 years.
Strange sort of “fiscal conservative businessman Republicans” they’re making these days, here and in DC.
http://www.chicagobusiness.com/article/20160119/NEWS02/160119822/rauners-turnaround-agenda-math-doesnt-add-up
- Anon - Tuesday, Apr 24, 18 @ 11:05 am:
“State could issue bonds at much less and pay bills on time and save the difference between 12% and the bonds %”
When you do it like that you have to make the payments whether you have the money or not.
Rauner and the legislature had no problem stiffing creditors because it acted as a loan in a time of cash crunch.
The last thing anyone in the state wants is another mandatory payment in the hundreds of millions a year for such a huge bond offering when the budget isn’t really balanced as it is.
It saves the government long term in theory, but when you live hand to mouth essentially like the state does at this point you can’t afford the mandatory payments associated with that huge bond offering.
Not to mention that the state invariably will need money for something else, so they essentially use the backlog as forced loans until they come up with the cash flow to pay them.
- Macbeth - Tuesday, Apr 24, 18 @ 11:06 am:
Out of all the weird/odd/bad things Rauner has done — this seems to be, hands down, the worst.
It’s astonishing, actually. And I’m guessing that when he’s asked about it, he’ll (a) laugh and then (b) blame Madigan for not enacting his agenda fast enough.
Mendoza is correct when she calls it asinine.
- Steve Rogers - Tuesday, Apr 24, 18 @ 11:08 am:
If the first graph shows that Pat Quinn failed (which it does), the second graph shows that Rauner catastrophically failed.
- m - Tuesday, Apr 24, 18 @ 11:09 am:
=Also, many vendors sell their receivables to investors who then collect the 12%.=
It’s a good business for those investors. In reality, for the business that can wait to get paid, a guaranteed 12% is a pretty good return.
Bad for taxpayers obviously, but hey, we are growing businesses with our late payment fees…
Maybe that should be part of the reelection pitch.
“Every late payment is an investment in our business community!” “Growing jobs 1 late payment at a time!”
- VanillaMan - Tuesday, Apr 24, 18 @ 11:11 am:
Rauner raised your taxes, provided no value, robbed the citizens of constituent services, drove businesses into bankrupsy, and made liberal government look competent.
After Blagojevich and Quinn, ILGOP got a break to show how much better they govern, but Rauner made ILGOP values, ideas, and policies a failed mockery.
It is better to lose an election, than win with Rauner.
- Anonymous - Tuesday, Apr 24, 18 @ 11:11 am:
Gee I wonder who is profiting from the vendor buyout program.
- Anonymous - Tuesday, Apr 24, 18 @ 11:12 am:
Someone with the resources should investigate that
- Anon - Tuesday, Apr 24, 18 @ 11:17 am:
Madigan is just is culpable for this as Rauner.
He made a political calculation (just like Rauner) that he could break him through the budget process and thus make him unelectable come re-election time.
Much of this outrage is revisionist history that glosses over the fact that neither Rauner nor Madigan wanted a deal.
It literally took until the last second and a situation so dire it would have permanently crippled the state to get movement (and the bare minimum at that).
- Oswego Willy - Tuesday, Apr 24, 18 @ 11:22 am:
===Madigan is just is culpable for this as Rauner.===
Not according to Candidate Rauner.
Candidate Rauner stated many times… debt, budgets, bond ratings… “Pat Quinn failed”
No, not Madigan, Rauner. Candidate Rauner told me so.
- Blue Bayou - Tuesday, Apr 24, 18 @ 11:28 am:
Alternate headline: Under Rauner, Banks Get All the Money.
- Anotheretiree - Tuesday, Apr 24, 18 @ 11:31 am:
I thought State health bills were 9% ? I recall hearing about a local dentist last year practically giddy when he got two checks..$900,000, and another for $100,000 of interest. Not a bad investment. And by the way, where are all those people who complained about the government through ACA forcing you to buy a product ? Engage in economic activity. Aren’t I being forced into loaning the state money at a rate and time period they dictate ?
- Ducky LaMoore - Tuesday, Apr 24, 18 @ 11:33 am:
===Much of this outrage is revisionist history that glosses over the fact that neither Rauner nor Madigan wanted a deal.===
Okay… https://www.youtube.com/watch?v=wLKAfWG-iTw
- Liandro - Tuesday, Apr 24, 18 @ 11:42 am:
“When you do it like that you have to make the payments whether you have the money or not.”
Yes, it gets much harder to steal from the next generation. Can’t have that, apparently.
- Cheryl44 - Tuesday, Apr 24, 18 @ 11:56 am:
Rauner ought to be made to pay that off.
- The Dude Abides - Tuesday, Apr 24, 18 @ 11:59 am:
If I’m the Pritzger campaign I’m going to make good use of that graph in future campaign ads. It is mind boggling looking at the damage Rauner has done to Illinois in just 3 years. It is scary thinking of a second Rauner term, remember, if he’s re elected he will no longer have to be held accountable by the voters. This November is his last chance for that.
- JS Mill - Tuesday, Apr 24, 18 @ 12:02 pm:
A business man helping businesses.
- The Way I See It - Tuesday, Apr 24, 18 @ 12:05 pm:
Billion dollar failure is a great line.
- Union thug - Tuesday, Apr 24, 18 @ 12:20 pm:
From what I can tell anymore. Fiscal conservative now equal to run up the bills and not pay. Rauner is not the only one…
- Deadbeat Conservative - Tuesday, Apr 24, 18 @ 12:25 pm:
=1% a month late fees = 12% a year. State could issue bonds at much less and pay bills on time and save the difference between 12% and the bonds %…. Not complicated personal finance math, but in our state this S show goes on and on.=
I recall that the GA passed a bill doing just what you suggested. It was opposed by GOP and Rauner on the false premise that the proceeds wouldn’t be used to pay the bills.
- James - Tuesday, Apr 24, 18 @ 12:26 pm:
This AP story was picked up by the SF Chronicle and Washington Post. Still haven’t seen it in either Chicago daily.
- Deadbeat Conservative - Tuesday, Apr 24, 18 @ 12:30 pm:
=Much of this outrage is revisionist history that glosses over the fact that neither Rauner nor Madigan wanted a deal.=
While your concoting false equivalencies - don’t forget Radogno.
- Oswego Willy - Tuesday, Apr 24, 18 @ 12:33 pm:
===Much of this outrage is revisionist history that glosses over the fact that neither Rauner nor Madigan wanted a deal.===
… and yet, Rauner continues to stop overrides to save the state.
“I’m frustrated too, but taking steps to reform Illinois is more important than a short term budget stalemate.”
Who… said that?
Madigan?
Keep up. It’s not revisionist history, it’s ignoring what happened and why, and the glee Raunerites had for social services closing, damaging higher education… holding a state hostage.
Oh, they were “frustrated”.
Give me a break.
- Wow said I - Tuesday, Apr 24, 18 @ 1:21 pm:
And the outrage for the Agency heads who incurred bills without an appropriation and the interest that must be paid. They should all be fired.
- a;m io sem - Tuesday, Apr 24, 18 @ 1:32 pm:
Now that we know the scope of the problem, and the ongoing cost of maintaining a huge unpaid bill backlog, who has a solution? Where are the proposals? Did the Gov include this in the 2019 budget? I don’t think so. Is there legislation to change the going interest rates to slow down the growth of our IOU? The private sector lenders from Vendor Payment aren’t getting paid either, so how is that going to get fixed? Did anyone look at the budget line for the Court of Claims? This is just financial malpractice of the worst sort.
- Anonymous - Tuesday, Apr 24, 18 @ 1:37 pm:
Rep. McSweenney who wants the best government services that money can buy he just doesn’t want to have to pay for them.
- Whatever - Tuesday, Apr 24, 18 @ 1:37 pm:
==Madigan is just is culpable for this as Rauner. He made a political calculation (just like Rauner) that he could break him through the budget process and thus make him unelectable come re-election time.==
The General Assembly actually passed full budgets. Rauner vetoed them all on his own. He also kept spending (or at least contracting for goods and services that needed to be paid for) without any appropriations or court orders requiring him to spend. No one person runs a government in this country, so nothing is ever 100% one person’s doing, but this comes as close as anything to being 100% Rauner.
- 44th - Tuesday, Apr 24, 18 @ 1:41 pm:
All of that $ out the door. Well its going to bring things to a head pretty soon. Good comments “a;m io sem” legislature needs to address the interest rates fast or this will get even more out of control.
- VanillaMan - Tuesday, Apr 24, 18 @ 1:46 pm:
Billions more in debt with nothing to show for it. No new efficiencies, no savings, no service improvements, no governing, no bipartisanship, no leadership, no future.
Worst governor ever.
- Anonymous - Tuesday, Apr 24, 18 @ 2:53 pm:
@Another Retiree
I believe the interest clock does not start ticking until 90 days after the bill is presented. Thereafter interest runs at 1% per month. The first year interest would thus be 9%. The second full year would be 12 months at 1% per month.
- it's going to get worse before it gets better - Tuesday, Apr 24, 18 @ 2:54 pm:
With all the debt to vendors the state is losing vendors which means state contracts are more expensive than previously. The vendors who remain are charging more than when they had competition. Basically, by signing a state contract vendors are giving IL a high interest loan. It’s a great deal if they can afford to float the cash to IL for a year or two but most can’t.
- Grandson of Man - Tuesday, Apr 24, 18 @ 6:00 pm:
Gov. Junk. Rauner vetoed the full budget and revenue. Think of how much worse Illinois would be if his vetoes stood. His vetoes are a testament to the wreckage he created. If we want to see how much Rauner despises unions and wants workers to eat huge cuts, look not only at the carnage already created, but the added damage of another year without a full budget and revenue.