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July could be a key month for the state’s beleagured budget

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Illinois

Will state government be next to announce furloughs, layoffs or pay cuts? As cash-strapped state and local governments look to Washington — and wait — for relief money to help pay for the unexpected costs tied to responding to COVID-19, Pritzker was asked about possible cuts: “Obviously, we look at that all the time because we want to be prepared. But the fact is, I think there is also a growing consensus the Senate will likely take up a (relief) bill of some sort … in July,” said Pritzker, sounding reasonably confident.

* Meanwhile…

Illinois, the first U.S. state to tap into Federal Reserve aid for pandemic-battered governments, has reduced its unpaid bills to the lowest level since 2015. […]

The state used $1.2 billion of proceeds from a short-term Fed loan to help pay down the bills, said Carol Knowles, a spokesperson for the Governor’s Office of Budget and Management. The Fed established its Municipal Liquidity Facility to help state and local governments bridge funding gaps created by the pandemic.

Illinois officials have said that if Congress doesn’t approve additional aid they may need to borrow almost $5 billion more from the Fed facility in the upcoming fiscal year to help close a more than $6 billion deficit. In April, after the state delayed its income tax filing deadline to July, officials forecast a $2.7 billion revenue drop for the fiscal year ending June 30.

Illinois’ backlog reached a peak of $16.7 billion in 2017.

posted by Rich Miller
Thursday, Jun 25, 20 @ 12:18 pm

Comments

Seriously … Have heard proposals to reduce headcount by “X” percent to deal with reductions in revenue. Has anyone did a study to show what, say, a 10% budget reduction would do to DCFS? Corrections? How many criminals would be let out early? Would it be across the board, or incarceration for certain crimes (say, dealing less than a pound of cocaine) be commuted?

A bit of snark - any such studies from IPI? Has The Center Square found any such academic studies?

Comment by Anyone Remember Thursday, Jun 25, 20 @ 12:53 pm
Great job on bringing the bill backlog down. It signals to businesses that we are being responsible.

Someone should string together all the times the Trib editorial board and others like them have called for budget cuts. It’s an absolute obsession with them.

Comment by Grandson of Man Thursday, Jun 25, 20 @ 12:54 pm
“Illinois, the first U.S. state to tap into Federal Reserve aid for pandemic-battered governments, has reduced its unpaid bills to the lowest level since 2015.” This is great news for IL.

Comment by M Thursday, Jun 25, 20 @ 1:07 pm
“Will state government be next to announce furloughs, layoffs or pay cuts?”

Rich, why do Republicans want the state to lay-off workers when we are in a recession? Workers spend money which in turn helps our economy.

Comment by Mama Thursday, Jun 25, 20 @ 1:11 pm
“Great job on bringing the bill backlog down. It signals to businesses that we are being responsible.“

Yes, it’s very impressive to make zero cuts, go to a fed window, and claim you’re being responsible. /s

Comment by weeds Thursday, Jun 25, 20 @ 1:17 pm
Weeds “claim you’re being responsible”?
How has the current governor not been responsible?

Comment by M Thursday, Jun 25, 20 @ 1:20 pm
The backlog reduction is artificial. As soon as the voucher is prepared to pay back the short-term loan (sometime in FY 21), the backlog goes right back to $7 billion.

Comment by Reality Thursday, Jun 25, 20 @ 1:23 pm
Weeds “claim you’re being responsible”?
How has the current governor not been responsible?

The backlog of bills was paid with BORROWED money….it’s the equivalent of using a different credit card……

Comment by SIU Thursday, Jun 25, 20 @ 2:29 pm
===it’s the equivalent of using a different credit card===

Only if that different card has a much lower interest rate.

Comment by Rich Miller Thursday, Jun 25, 20 @ 2:47 pm
If you don’t have the wherewithal to pay any of it back without borrowing again/more…..it doesn’t really matter. the interest rate is simply a number on another bill that you can’t afford/pay.

Comment by SIU Thursday, Jun 25, 20 @ 3:14 pm
==Seriously … Have heard proposals to reduce headcount by “X” percent to deal with reductions in revenue. ==

Do you know if these proposals were coming from GOMB or other state agency heads? Or were these “proposals” just media speculation (and for some, Trib included, and maybe SJ-R, wishes)?

Comment by Chatham Resident Thursday, Jun 25, 20 @ 4:17 pm
== another bill that you can’t afford/pay==

Ok, so how much do you want to immediately raise our taxes so that we don’t have to go through with the borrowing plan?

Comment by Lester Holt’s Mustache Thursday, Jun 25, 20 @ 4:52 pm
Doesn’t laying off state employees amount to shifting their cost from one budget line to another (unemployment or pension)?

Comment by Rockford Greg Thursday, Jun 25, 20 @ 4:56 pm