As Illinois struggles to recover from the nation’s most severe budget crisis, which almost saw the state’s credit rating lowered to “junk” status over the summer, a new report has found the state still has billions in unpaid bills.
The review, reported by the Associated Press, found that $7.5 billion in bills have not yet been forwarded on to be paid, and another $9 billion have been delivered but are going unpaid because of a lack of funds—leaving the state with a total of $16 billion in past-due bills.
The number indicates the state has made little progress in digging itself out of its debt from before it passed its most recent budget this summer. The bills that have been paid since then have been largely replaced by a similar amount in new bills.
This giant backlog resulted in part from a stalemate between the Republican governor and the Democrats in control of the General Assembly. For more than two years, the two sides battled it out and were unable to pass a constitutionally mandated budget. During that time the amount of past-due bills tripled.
From Slate’s Osita Nwanevu:
The stalemate with the state’s Democratic-controlled Legislature has put the state nearly $15 billion behind on its bills…
Social services and public education have been hit hard. Sixty-nine percent of social service agencies responding to a recent United Way survey have received partial or no payments for fiscal year 2017, including agencies for the homeless, child care, and mental health treatment. More than 1,500 employees have been laid off at the state’s community colleges and public universities.
It wasn’t until Republicans in the state Legislature joined Democrats to override Gov. Bruce Rauner’s veto that a budget was finally passed in June. The new budget raised income taxes and corporate taxes, but it wasn’t expected to solve the state’s budget crisis.
And in the meantime, some state agencies held back on sending their bills in because lawmakers did not approve the spending. The AP reported that in June, for example, the Department of Corrections had $471 million in unpaid bills. If expenses aren’t given the green light ahead of time, lawmakers have to approve them after the fact; the two sides and the comptroller have all continued to grapple over the management of the budget, including on which fund to draw from to pay for particular bills.
The longer the bills go unpaid, the more at risk the state becomes of being completely mired in crippling debt. Many bills older than 90 days face a 1 percent-per-month penalty fee, according to the AP. Of the current backlog, $5.5 billion would already be subject to this penalty. Comptroller Susana Mendoza estimates the state could pay $990 million in these fees.
The state is hanging on to its above-junk rating, but it’s not out of danger yet.