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From the $1.9 trillion spending plan the Senate passed, federal taxpayers are poised to send the state of Illinois $7.5 billion for the state budget.
That’s not enough to cover the state’s bill backlog.
Illinois Comptroller Susana Mendoza said on social media she and Gov. J.B. Pritzker agreed that federal dollars the state is expected to get should be prioritized to pay back recently borrowed federal funds.
The state has borrowed about $3 billion from federal programs during the pandemic and is slated to pay back the borrowing over several years. […]
But that doesn’t leave enough to cover backlogged bills that as of Monday was in excess of $5.8 billion for vendor services already rendered.
The state reaches a normal 4-week payment cycle once the backlog is reduced to around $3 billion. So, yes, there’s enough money to pay the bills and end what is actually the backlog and even provide a bit of a cushion.
Also, to show you how things can fluctuate, the comptroller’s site has the current backlog at $5.6 billion.
…Adding… I assume that a chunk of that federal money will be churned through federal matching accounts, like Medicaid, which will produce even more revenue. So, it’s tough to say how much that will all add up to when all is said and done.
posted by Rich Miller
Tuesday, Mar 9, 21 @ 3:12 pm
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-5.8(bill backlog)+3(monthly allowable)-3(federal programs)+7.5(ARP Act of 2021)=1.7 billion available
Comment by Blake Tuesday, Mar 9, 21 @ 3:17 pm
The Center square slogan should be- “The Center Square: We Stink at Math…and other things”
Comment by JS Mill Tuesday, Mar 9, 21 @ 3:28 pm
I will now demonstrate my lack of accounting knowledge
Are the federal funds Illinois borrowed at a low interest rate or possibly can be forgiven? If so why pay them off why not pay something off that has a higher interest rate?
Comment by DuPage Saint Tuesday, Mar 9, 21 @ 3:32 pm
They should change their name to Paul Lynde for the block
Comment by MickJ Tuesday, Mar 9, 21 @ 3:39 pm
Will any of the federal money going to the state budget be enough to overturn the cuts the Governor announced Dec. 15, as well as prevent any cuts proposed in the FY22 budget? Or will those cuts still happen despite the stimulus money?
Comment by Essential State Employee Tuesday, Mar 9, 21 @ 3:41 pm
We’ve been pretty tough on Governor Pritzker. Let’s call this agreement with the Comptroller a win for his administration.
Let’s also ask if Comptroller Mendoza is planning on paying back the state for the time she got paid for a full month of legislative duties when she only worked for part of the month.
Comment by Candy Dogood Tuesday, Mar 9, 21 @ 3:43 pm
The only fact Center Square brings is the fact that they lack an honest look at facts while pushing alternative thoughts.
=== I assume that a chunk of that federal money will be churned through federal matching accounts, like Medicaid, which will produce even more revenue. So, it’s tough to say how much that will all add up to when all is said and done.===
This. All day.
My thought to it is “hold the powder” on the impact until every dollar, real and matched, is found and tabulated outside what is first to the ledger.
It’s disappointing that Center Square wants the numbers now to a negative when the real and actual impact isn’t fully known.
Comment by Oswego Willy Tuesday, Mar 9, 21 @ 3:43 pm
The bill backlog and the amount we actually owe for those bills are two separate things.
Comment by City Zen Tuesday, Mar 9, 21 @ 3:44 pm
=== The bill backlog and the amount we actually owe for those bills are two separate things.===
And?
Comment by Oswego Willy Tuesday, Mar 9, 21 @ 3:49 pm
Oh wow.
Can we finally get the bill backlog to something that isn’t embarrassing?
Comment by Nick Tuesday, Mar 9, 21 @ 4:05 pm
==And?==
While we owe $5.6 billion on backlogged bills, we still owe close to $15 billion for those bills. All that changed was whose name in on the checks and the classification on the state’s ledger.
Comment by City Zen Tuesday, Mar 9, 21 @ 4:06 pm
For all the folks that say run government like a business, well businesses also have debt. I would say my idea of not having a bill backlog is not that we have no bills but that we have no bills that are affected by the Prompt Payment Act where we have to pay interest on those bills.
Comment by Nadigam Tuesday, Mar 9, 21 @ 4:06 pm
=== While we owe $5.6 billion on backlogged bills, we still owe close to $15 billion for those bills. All that changed was whose name in on the checks and the classification on the state’s ledger.===
So what is your point to this exercise if the plan is to pay on the debt?
This is why drive by “thoughtful” is rarely that.
Comment by Oswego Willy Tuesday, Mar 9, 21 @ 4:09 pm
=== I assume that a chunk of that federal money will be churned through federal matching accounts, like Medicaid, which will produce even more revenue. So, it’s tough to say how much that will all add up to when all is said and done.=== What we do know is that the federal Covid relief package features an extension of the temporary Medicaid reimbursement rate “bonus” of 6.2 percent @ least through the end of 2021. Which means Illinois’s FMAP rate is 56.2 percent instead of its usual 50 percent rate for matching Medicaid funds.
Comment by Jeff Schoenberg Tuesday, Mar 9, 21 @ 4:13 pm
==So what is your point to this exercise if the plan is to pay on the debt?==
Only that the state is transparent about the debt. There is somewhere around $15 billion owed on bills, not $5.6 billion.
If I buy a $50,000 F-150 with a full loan from FoMoCo, then my dad hands me a $30,000 check to put towards the principal of that loan but expects me to pay him back, do I owe only $20,000 on that truck?
Comment by City Zen Tuesday, Mar 9, 21 @ 4:27 pm
=== Only that the state is transparent about the debt. There is somewhere around $15 billion owed on bills, not $5.6 billion.===
Again, if it’s being paid down, and the fed money is hopefully going to be maximized, what exactly are you trying to beef about here?
You still are unclear, pickup truck or not.
Comment by Oswego Willy Tuesday, Mar 9, 21 @ 4:32 pm
Not saying the Center Square is wrong, but the USA Today reported Illinois would get $13.5 billion as of 03/04. Did it change?
https://www.usatoday.com/in-depth/news/politics/2021/03/04/how-much-money-each-state-would-receive-if-joe-biden-covid-stimulus-bill-passes/6892464002/
Comment by Fivegreenleaves Tuesday, Mar 9, 21 @ 5:16 pm
$13.5B is the total expected for both state and local governments here.
The $7.5B is the share of it which is expected for the state alone, not counties/municipalities.
Comment by Nick Tuesday, Mar 9, 21 @ 5:48 pm
“”For all the folks that say run government like a business”"
To say this another way so those folks can relate: If Illinois were a Fortune 100 Corporation, we would expect our CFO to keep our Accounts Payable around $3.2B. That would be considered excellent performance.
Paying down debt is another legitimate issue.
Comment by walker Tuesday, Mar 9, 21 @ 5:54 pm
“$13.5B is the total expected for both state and local governments here.”
Thank you for the clarification, Nick.
Comment by Fivegreenleaves Tuesday, Mar 9, 21 @ 5:57 pm
==The only fact Center Square brings is the fact that they lack an honest look at facts while pushing alternative thoughts.==
Knowing their backers, Center Square will never suffer as long as they’re overstating the financial woes the state is in.
Comment by Socially DIstant Watcher Tuesday, Mar 9, 21 @ 6:20 pm
Not sure why everyone leaves this out of the bill backlog but in 2017 the State borrowed $6 billion on what I believe was a twelve year note. Those unpaid bills didn’t just disappear. They were just moved to a different bucket. Not sure what the principal left on that borrowing is but it is clearly part of the bill backlog. Or maybe I’m just unclear on the concept. Maybe if I moved my credit card debt to a home equity loan I could count it as magically disappearing.
Comment by Eastside Tuesday, Mar 9, 21 @ 6:54 pm
Review the Comptroller’s lastest DTA. It will answer alot of your questions and assumptions. There isn’t much Medicaid pending since it’s been it’s been a priority to keep current on these bills during a healthcare pandemic. As the Comptroller said, new federal money should go to paying off $3 billion COVID loans that was used
to keep healthcare afloat during the pandemic in 2020. This action was the most responsible action and now we have to pay it off while we can to preserve the budget for the future. Just sayin…
Comment by Just Sayin ... Tuesday, Mar 9, 21 @ 8:41 pm
Never mind the dollar amount of the unpaid bills. I want to know the time backlog in days. Then I can figure out what it takes to get it down to a reasonable amount, let’s say under 30 days, and compare it with cash flow and revenue.
Comment by Angry Chicagoan Tuesday, Mar 9, 21 @ 8:51 pm
East side: the Bill backlog is the outstanding invoices the state still needs to pay. The amount borrowed (as you put it from a credit card to a home equity line) did pay those outstanding invoices and moved the debt to a secured debt that is paid first before anything else. Thus, yes there are different classifications at play.
Comment by Kool Aid Tuesday, Mar 9, 21 @ 9:29 pm
Kool Aid. Distinction without a difference. The debt incurred to pay those invoices are unpaid bills. All we did was lower the interest rate. They are still unpaid bills. Debt, by definition, is unpaid. Otherwise, it is not a debt.
Comment by Eastside Wednesday, Mar 10, 21 @ 8:20 am
==Sadly, the rulers of Illinois will simply take the money and spend it on something else…mark my words==
Yes, I will definitely take it on faith that the $$$ will be spent on “something else” because Anonymous said so.
Comment by The Doc Wednesday, Mar 10, 21 @ 8:24 am
===because Anonymous said so===
Please don’t respond to anonymous commenters. I delete them as soon as I see them, so it’s pointless to engage.
Comment by Rich Miller Wednesday, Mar 10, 21 @ 8:44 am