Story URL: http://news.medill.northwestern.edu/chicago/news.aspx?id=158430
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Ryan Craggs/MEDILL

Education, health care and human service related programs make up three-fourths of general revenue money. This year, that spending is projected to drop from $29.8 billion to $28.4 billion.


Bills, bills, bills—and no way to pay them

by Ryan Craggs
Feb 25, 2010


When you don’t pay rent, you get evicted. Don’t pay the electric bill, you sit in the dark. Don’t pay the heating bill, you’re going to need some blankets. The principle is pretty simple.  Eventually, you have to pay the piper.

Except if you’re the state of Illinois.

“There isn’t enough money,” said Alan Henry, director of communications for the state comptroller. “That’s the long and short of it.”

This year, Illinois is running a $5 billion budget deficit.  Next year, the state faces the specter of an $11 billion deficit.

That’s a whole lot of unpaid bills.

“The priorities for the remainder of the fiscal year are debt repayment, general state aid to schools, Medicaid payments and government payrolls,” Henry said. “The state owes $2.25 billion in short-term loans that have to be paid back by the end of the fiscal year in 4 months.  That’s $500 million a month.”

While these priorities continue to be paid on time, other creditors have had to line up to get their share. Whatever is left in the pot after top priorities are fed goes to whoever has been waiting the longest.   

“The problem is, we’re about $4 billion in the hole,” Henry said. “We have a backlog of close to 200,000 individual vendors or vouchers. When money comes in, it goes out.”

The problem for Illinois right now: Money isn’t coming in. The state has announced plans to apply $1 billion in stimulus money toward general state aid, but it can’t account for the gaps in the budget for this year or next. By law, the budget is supposed to be balanced.

Gov. Pat Quinn has said he is in favor of a cigarette tax and increasing taxes in several areas, but some officials say raising taxes during a recession is a sure path to disaster.  Quinn is set to lay out his budget proposal next month.

“When you see such a huge deficit, you think, ‘Hmm, what can we do to fix this?’” said Kelly Kraft, director of communications for the governor’s office of management and budget. “You can’t address it with any single measure. We have to take a look at places we can cut and increase revenue. There isn’t one magic bullet.”

Whether in the form of slashing services or raising taxes, budgetary changes are coming.