New report finds Illinois ‘Digging Out’ from $3.2B debt, $500M worse than Rauner estimated
A new report from Gov. Pritzker’s administration details the extent of the damage done by his predecessor Bruce Rauner. (One Illinois/Ted Cox)
By Ted Cox
The Pritzker administration issued a blistering indictment of former Gov. Bruce Rauner on Friday with a new budget report charging he left the state with a $3.2 billion budget deficit — $500 million worse than he estimated last fall.
Authored by Deputy Gov. Dan Hynes, “Digging Out: The Rauner Wreckage Report” charges the Rauner administration with “even worse damage than previously known,” according to a news release issued Friday.
Building on the extensive work of Comptroller Susana Mendoza in identifying the extent of the state’s fiscal crisis and the damage done by Rauner’s two-year budget impasse with the General Assembly, the report charges that “late-payment interest penalties related to Rauner’s impasse have exceeded $1.25 billion, and interest on the refinancing of Rauner’s bill backlog will surpass $2 billion.”
The report specifically charges that, last year alone, the state paid $700 million in late-payment penalties — comparable to the budget of the Department of Children and Family Services, or the equivalent of hiring 7,000 new teachers statewide.
It also says the state’s miserable bond rating has cost $75 million a year since 2017 — the equivalent of 25,000 Monetary Award Program grants for higher education, enough for every undergraduate student at Illinois State University and Southern Illinois University at Carbondale.
“Illinois will need years to dig out of the fiscal mess this administration inherited, and the road to recovery will begin with Gov. Pritzker,” said Hynes, who’s been assigned with budget and economic issues as one of Pritzker’s deputy governors. “The Pritzker administration will be honest and transparent about the challenges we face and put forward long-term plans and investments that will get our state on firm financial footing. Despite these challenges, we will propose a balanced budget that invests in education and human services that were decimated under the previous administration.”
In championing Thursday’s Senate passage of a bill to move the state’s minimum wage to $15 an hour by 2025, Pritzker insisted he would still pass a balanced budget this year. But Friday’s report detailed the extent of the damage done in the state’s backlog of unpaid bills, charging that Rauner also failed to pay rent on the governor’s Washington, D.C., office and forfeited millions in federal reimbursements administered through the Occupational Safety and Health Administration.
According to the report, the total debt associated with the state’s unpaid bills now adds up to $15 billion: $7.9 billion in bills yet to be paid, $5.5 billion in backlog borrowing, $650 million in “interfund borrowing,” and $500 million in backpay for state union employees Rauner engaged in a prolonged and ultimately losing court battle.
AFSCME Council 31 Executive Director Roberta Lynch and Comptroller Susana Mendoza warned last fall that Gov. Rauner was risking “hundreds of millions” in backpay in his extended conflict with state union workers. (One Illinois/Ted Cox)
Mendoza and Roberta Lynch, executive director of the American Federation of State, County and Municipal Employees Council 31, warned in October that Rauner was risking “hundreds of millions of dollars” by declaring an impasse in negotiations with the union and refusing to pay contractual step increases. Shortly after that, an appellate court ruled that Rauner was wrong to have declared that impasse, leaving the state susceptible to backpay.
Rauner’s extended war with AFSCME Council 31 did result in the U.S. Supreme Court ruling against so-called fair-share union fees in the Janus decision, but that now appears to be a Pyrrhic victory where state finances are concerned.
“The choice by the Rauner administration to wage ideological warfare took a severe toll on our state,” the report declares. “Human-service agencies closed, and college and university enrollment plummeted. The Rauner years will have ripple effects for a generation to come. … Illinois already had fiscal challenges to overcome, but the previous administration drove the state into a ditch.”
The report forecast that “digging out” would take more than a year or even Pritzker’s first term, but the administration pledged it “is committed to working diligently and across party lines to put our state on a path to fiscal stability.”
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February 8, 2019 at 11:31AM