Today, Comptroller Susana A. Mendoza announces the latest installment of $180 million into the state’s Rainy Day Fund, bringing the balance to a record level of $1.036 billion, the highest balance in the fund, also called the Budget Stabilization Fund, to date.
Comptroller Mendoza has been a vocal advocate for reviving the Rainy Day Fund, which serves as the state’s main savings account. It had been decimated during the 2015-2017 state budget impasse. In April 2018, the reserve account stood at just $48,327.53.
“We’re saving today to invest in tomorrow,” said Comptroller Mendoza. “This latest infusion proves that we are prioritizing paying down our debts, addressing the pension shortfall and not putting the problems of yesterday on the backs of future generations.”
The appropriation was supported by Gov. JB Pritzker and approved by the Illinois General Assembly earlier this year. With higher-than-anticipated revenues for the prior fiscal year, not only did the General Assembly and the Governor approve of a $1.8 billion tax-relief plan for taxpayers, but they also resisted to spend, as this $1 billion into the state’s Rainy Day Fund for fiscal year ’22 and ’23 makes clear. The most recent budget also includes paying an extra $500 million into the Pension Stabilization Fund, which will lower pension debt liabilities by $1.8 billion.
This latest deposit into the Rainy Day Fund this week is the final installment based on the appropriations per the most recently approved state budget. Starting next fiscal year, the legislature has agreed to put in an additional $45 million into the fund annually.
“Building a robust emergency reserve account is responsible. And the credit rating agencies agree. They cited the state’s infusion into reserves as one reason for recent upgrades. Better credit ratings mean better rates on bonds, and that means more savings for taxpayers and better finances for the state overall,” Comptroller Mendoza said.
Illinois has earned six credit upgrades from the credit rating agencies since June 29, 2021 – the first upgrades in over two decades.
While these welcomed infusions into the Rainy Day Fund and the Pension Stabilization Fund are certainly a great boost, Comptroller Mendoza continues to call for more regular automatic deposits into these funds during strong economies, without having to depend on one-time infusions of future legislatures.
During the fall veto session Comptroller Mendoza will ask the General Assembly to take up HB 4118, sponsored by State Rep. Michael Halpin, D-Rock Island. The proposal would require additional annual contributions to both the Rainy Day Fund and the Pension Stabilization Fund.
“Further saving and paying down our debts when the state can afford it will better prepare us for the next fiscal downtown or crisis, such as a recession, that may come through no fault of our own,” said Comptroller Mendoza.