Mendoza moves money around in face of pandemic
Wednesday, Apr 8, 2020 - Posted by Rich Miller
* Capitol News Illinois…
The Illinois comptroller’s office borrowed $105 million from various funds in March, in large part so it could make bigger-than-normal payments to hospitals as they brace for the peak of the COVID-19 outbreak later this month.
But Illinois Comptroller Susana Mendoza is advising all state vendors that there will likely be payment delays in April, in part because the tax filing deadline for both state and federal taxes has been pushed back to July 15.
The inter-fund borrowing was noted last week in the state’s monthly revenue report from the Commission on Government Forecasting and Accountability. The comptroller’s office has authority to engage in such borrowing to meet short-term cash flow needs of the general revenue fund.
That report noted that total tax receipts in March, at $3.4 billion, was about what was expected, and 3.3 percent above the same month last year. But it also noted that the impact of the economic slowdown brought on by Gov. JB Pritzker’s stay-at-home order and closure of nonessential businesses had not yet shown up in the revenue numbers.
Some of that borrowed money was used to capture federal matches and contributed to a $145 million increase in federal revenue in March, according to COGFA.
* Excerpt from Mendoza’s statement issued last week…
State revenues, estimated at well over $1 billion, traditionally expected in the month of April due to increased seasonal income tax payment activity, will be delayed until at least July, given the extended tax payment deadlines announced by both the state and federal governments.
In addition to the deferred revenues from the filing extension, it has not yet been determined what additional negative fiscal impact reduced economic activity related to this pandemic will have on our state revenues going forward.
The most immediate priority today, and in the coming weeks, will be emergency funding for critical medical equipment and services necessary to combat the COVID-19 coronavirus on the front lines. While our immediate priority is to provide funding necessary to fight the pandemic and save lives, the core priorities of the IOC remain the same.
Healthcare, debt service, K-12 funding, state payrolls, and required pension payments will continue to be made, and the state’s most vulnerable citizens’ urgent needs will continue to be served.
As in past times of budgetary difficulties, the predictability and the timing of specific payments may be uncertain, but the provider and vendor community can be assured that, as in the past, all state payments will eventually be made, and all state commitments will be honored.
Given this reality, the IOC asks for understanding and patience as we address the impact from this pandemic, while continuing to manage an existing state bill backlog of over $7 billion.
The latest bill backlog number is $8.096 billion.
- pawn - Wednesday, Apr 8, 20 @ 10:24 am:
Just another reminder that we were on track for better fiscal health when the Quinn-era tax increase expired and Governor Rauner decided to create a crisis for his leverage to fight with the unions. In a different universe, in which the tax did not expire, the bill backlog was dramatically reduced or even eliminated, and we did not put the state through two years of fiscal insanity, in that world we would have been much better positioned for this current crisis than we are now. I had hoped we were on the path of putting the disastrous political vanity career of Bruce Rauner behind us, but I see that we continue to pay for his hubris.
- Demoralized - Wednesday, Apr 8, 20 @ 11:06 am:
I think Governor Rauner was a horrible Governor and make the state’s financial condition 10 times worse than it should have been, but attempting to link him to the financial woes being caused by this pandemic is far feteched.
- AD - Wednesday, Apr 8, 20 @ 11:10 am:
I’m a Democrat and support Susana, but man do we miss JBT right now. People like Judy that are sharp, trustworthy and not afraid to reach across the aisle are who we need now and I’m not seeing the leadership in that office any more.
- My 2 Cents - Wednesday, Apr 8, 20 @ 1:03 pm:
-AD-
I kindly disgaree. I miss JBT also, she was one the best ever. However I think Comptroller Mendoza is doing a fine job.
- John Deere Green - Wednesday, Apr 8, 20 @ 1:07 pm:
==attempting to link him to the financial woes being caused by this pandemic is far feteched.==
It absolutely is not far-fetched. You state he made “the state’s financial condition 10 times worse than it should have been.” The degree to which he did that aside, his actions not only delayed Illinois’ recovery, they set it back drastically. A far different path from the one in which it saw the bill backlog decline, and a large reason it did is because it had additional revenues. No budgets for two years, relying on court orders and consent decrees for mandatory spending, significant drops in needed revenue. The state would have been in a much better financial position to combat the effects of this pandemic if not for his silly and damaging ideological war. Great financial position? No. Ideal? No. Better? Absolutely.
Illinois also suffered eight bond ratings downgrades from the three ratings agencies during the Rauner years. Would there have been downgrades with four more years of Quinn? Maybe, maybe not. We’ll never know. We do know Rauner gave us eight downgrades that has the state teetering on junk and paying borrowing penalties out the nose.
- Nanker Phelge - Wednesday, Apr 8, 20 @ 1:36 pm:
She is using the tax deadline extension as an excuse. She has reduced staffing. That accounts for payment delays.
- Douglas - Thursday, Apr 9, 20 @ 12:39 am:
No one here really seems to get it. Six straight years of population decline for the state, 5 for chicago, unemployment among the highest of states in 2019 and many of you just think you can continue to tax. Companies and people do not have to stay, then who will you extort?
You advocate a slow death of Illinois, rather than accept that there are serious problems that need reform.