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* Last year’s General Funds Walk Down produced by GOMB projected the Fiscal Year 2021 deficit at $3.9 billion with a payment backlog of $10.16 billion. That backlog was projected to grow to $33.16 billion by Fiscal Year 2026, with deficits between $4.2 billion and $4.8 billion every single fiscal year.
This year’s GOMB walk down is a whole lot different. GOMB is projecting a surplus in FY 2022 of $418 million, with deficits of $406, $820, $1,061, $903 and $598 million in the coming fiscal years.
That still ain’t great, but it’s a world away from where the state was. That is, of course, if those projections hold up. Last year’s projections were obviously way off.
* Press release…
The Governor’s Office of Management and Budget (GOMB) released the annual Economic and Fiscal Policy Report showing Illinois has made significant improvement in its structural deficit under Governor Pritzker’s leadership. As the state recovers from the COVID-19 pandemic, this progress has been fueled by the Governor and the General Assembly passing and implementing balanced budgets, promoting economic development to create jobs and boost economic activity, and closing corporate tax loopholes.
GOMB is now projecting significantly smaller deficits than estimated previously in the general funds budget for fiscal years 2023 through 2027. The forecasted fiscal year 2023 shortfall was reduced from $2.9 billion, as estimated in 2019, to $406 million, and the 2024 shortfall was reduced from $3.2 billion, as estimated in 2019, to a deficit of $820 million.
“With our partners in the General Assembly we’ve made tremendous progress in putting Illinois on the right fiscal path, supporting small businesses, and creating good jobs in every part of our state,” said Governor JB Pritzker. “I am committed to building on this significant progress while tackling our remaining fiscal challenges. Together, we can build long term fiscal stability for Illinois while ensuring economic opportunity in all of our communities.”
The future years’ budget outlook also benefits from strong pension fund investment returns in fiscal year 2021, substantial early debt retirement in 2021 and interest cost savings from paying down the State’s unpaid bill backlog.
The Governor intends to pursue several actions to continue Illinois’ strong path forward, including directing funds to further reduce the state’s existing payables, reserving additional funds for fiscal emergencies or economic downturns, and continuing the management controls put in place at the beginning of the Pritzker Administration to continue to responsibly manage the limited resources of state government. With the Governor’s recommended actions, the state’s unpaid bills have been significantly tamed, with the vast majority of bills now paid within 30 days. The outstanding invoices, most of which are less than 30 days old, are estimated to fall below $2.75 billion by the end of fiscal year 2022, down from the $9.2 billion of outstanding bills and cashflow borrowings prior to taking office. This would be a nearly $6.5 billion - or 70 percent reduction - while replenishing the Budget Stabilization Fund that was drained during the previous administration.
Illinois’ significant improvement to its fiscal outlook was heralded last summer by the state’s credit rating agencies, with an upgrade to its general obligation bond credit rating granted by Moody’s Investor Services and S&P Global Ratings in June and July 2021.
GOMB is required to annually submit an Economic and Fiscal Policy Report to the General Assembly outlining the long-term economic and fiscal policy objectives of the state, along with the economic and fiscal policy intentions for the upcoming fiscal year and for the subsequent four fiscal years.
posted by Rich Miller
Tuesday, Nov 9, 21 @ 1:11 pm
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Eat that IPI.
Comment by Lt Guv Tuesday, Nov 9, 21 @ 1:26 pm
Some folks “down the dial” are going to be upset.
If you’re angry about a better fiscal outlook, you probably aren’t a champion of a want for a better Illinois… and probably a grifter to boot.
Comment by Oswego Willy Tuesday, Nov 9, 21 @ 1:28 pm
Better, but there’s still plenty of can left to kick down the road.
Comment by Furtive Look Tuesday, Nov 9, 21 @ 1:34 pm
How much better would that report have looked if we’d passed the Fair Tax, I have to wonder.
Comment by Give Us Barabbas Tuesday, Nov 9, 21 @ 1:42 pm
But, but, but, we have to wear mask and get that shot and JB is mean to us.
Comment by Give Me A Break Tuesday, Nov 9, 21 @ 1:46 pm
Wait, What?
Accounts Payable under 30 days
A Surplus forecasted for this fiscal year. A SURPLUS.
Pensions seen as “turning the corner” by analysts.
Not time to relax the fiscal discipline — much to do, much to do.
Comment by walker Tuesday, Nov 9, 21 @ 1:51 pm
If only we had Right-to-Work … /s
Comment by Skeptic Tuesday, Nov 9, 21 @ 1:57 pm
Solid progress but still have deficit of $820 million for 2024.
Illinois can not afford to have any budget deficits. Basically three have been a number of very good years on the economic front. Time to get ahead of the game ASAP. Particularly if we hit an economic downturn which nobody ever sees coming but history has shown to occur to surprising regularity.
Comment by Unconventional wisdom Tuesday, Nov 9, 21 @ 2:23 pm
“But, but, but, we have to wear mask and get that shot and JB is mean to us.”
And the exodus of people from Illinois accelerates. /s
Comment by Huh? Tuesday, Nov 9, 21 @ 2:44 pm
So what your saying is, we really didnt need that progressive tax thing after all.
Comment by Blue Dog Tuesday, Nov 9, 21 @ 2:48 pm
“So what your saying is, we really didnt need that progressive tax thing after all.” I think what it’s saying is that this is good and it would have been even better with the progressive tax.
Comment by Skeptic Tuesday, Nov 9, 21 @ 3:58 pm
“The future years’ budget outlook also benefits from strong pension fund investment returns in fiscal year 2021″
We’ve been on a great stock market run which is bound to turn around fairly soon. It will be interesting to see how much impact a bear market has on the budget.
Comment by Nick Nombre Tuesday, Nov 9, 21 @ 4:09 pm
So what your saying is, we really didn’t need to reduce pensions.
Comment by Blackhawk Tuesday, Nov 9, 21 @ 6:01 pm
This is great news. Would it kill folks to use this to cheer on Illinois? Trib? IPI? Eastern Bloc? Doesn’t it make sense to try and further the progress for Illinois? Does it always have to be partisan fighting that results in a mess?
Comment by Tired Teacher Tuesday, Nov 9, 21 @ 7:20 pm
You don’t suppose any of that $3.5 billion from the feds helps do you???
Comment by Anonymous Wednesday, Nov 10, 21 @ 7:11 am