>> ILLINOIS MAY HAVE A BUDGET
BUT SCORES OF SCHOOLS, HOSPITALS
AND SOCIAL SERVICE AGENCIES ARE
STILL WAITING FOR CASH THE STATE
OWES THEM.
WHAT IS BEING DONE ABOUT IT?
THE ILLINOIS OFFICERS SAY NOT
ENOUGH.
WE'RE JOINED BY AMANDA VINICKY.
FIRST, HOW MUCH DOES THE STATE
OWE IN AGGREGATE?
>> YOU RECALL, THE STATE KEPT ON
SPENDING MORE THAN THE STATE WAS
TAKING IN AND ONE OF THE WAYS
THAT ILLINOIS WAS ABLE TO GET
AWAY WITH IT WAS DELAYING
WRITING CHECKS.
NOT TALKING ABOUT A DEFICIT OR
THE UNFUNDED PENSION LIABILITY
I'M TALKING ABOUT A BACKLOG OF
OVERDUE, UNPAID BILLS THAT
BALLOONED TO $15 BILLION.
NOW NOT THAT YOU WOULD DO
ANYTHING LIKE THIS.
BUT LET'S IMAGINE...
IF YOU WERE GOING TO RUN UP YOUR
CREDIT CARD BILL AND DID NOT
PAY, YOU WOULD INCUR A TON OF
INTEREST AND THE SAME THING FOR
THE STATE OF ILLINOIS.
THERE IS A LAW THAT SAYS IF
ILLINOIS IS MORE THAN THREE
MONTHS LATE PAYING CERTAIN
VENDORS IT TOO, BEGINS TO RACK
UP INTEREST AND IT IS NOT CHEAP.
SOME OF THE BILLS COST ILLINOIS
UP TO 12% INTEREST.
>> SO --
>> THERE'S WAYS TO SMARTLY
ATTACK THE BILL BACKLOG BUT WE
HAVE TO DO THAT RIGHT AWAY.
PEOPLE THINK NOW THAT WE HAVE A
BUDGET WE SHOULD HAVE PAYMENTS
WITHOUT ACCESS TO THE CAPITAL
IT'S AS IF WE DID NOT HAVE THE
BUDGET YET FOR THE PURPOSES FOR
THE PEOPLE AIT WHATTING PAYMENT
FROM THE STATE OF ILLINOIS.
>> WHAT IS THE PLAN?
>> IT'S NOT JUST THE
COMPTROLLER, MENDOZA IS MAKING A
BIG DEAL ABOUT THIS.
THE TREASURER WHO IS A DEMOCRAT
SUPPORTS IT, TOO.
AND THIS IS IMPORTANT TO KEEP IN
MIND GOING FORWARD SO DID
REPUBLICANS.
SENATOR BILL BRADY HE IS NOW THE
TOP REPUBLICAN IN THE SENATE,
HAD SOMETHING LIKE THIS PLANNED
IN THE BUDGET HE PROPOSED A
BUDGET THAT THE GOVERNOR, BY THE
WAY, SAID HE WOULD SUPPORT AND
GROUPS LIKE THE CIVIC FEDERATION
DO, TOO.
HERE IS THE PLAN...
WHEN THE GENERAL ASSEMBLY PASSED
A BUDGET LEGISLATORS AUTHORIZED
A BOND ISSUE.
BORROWING $6 BILLION THAT COULD
BE USED TO PAY DOWN THE BILL
BACKLOG.
YOU MAY THINK ILLINOIS BORROW
MORE?
HERE IS WHY MENDOZA AND ALL OF
THE OTHER INDIVIDUALS AND GROUPS
SAY THAT IT MAKES SENSE.
>> THE SAME AS A PERSON WITH
THEIR HOME MORTGAGE.
IF A PERSON IS PAYING INTO THEIR
MORTGAGE BUT PAYING 7% INTEREST
ON THAT MORTGAGE LOAN.
AND THEY COULD GET A DEAL WHERE
THEY PAY 3% IT'S COMMON SENSE IT
IS A GOOD OPPORTUNITY TO
REFINANCE THE DEBT.
YOU DO NOT ELIMINATE IT BUT
PAYING LOWER INTEREST RATES ON
THE DEBT.
THE STATE OF ILLINOIS HAS $15
BILLION IN DEBT.
IF WE DIDN'T HAVE ANY DEBT I
WOULD NOT BE MAKING THE CASE FOR
BORROWING.
BUT WHEN WE HAVE A $15 BILLION
DEBT AND PAYING UP TO 12%
INTEREST ON PAYING OUR BILLS
LATE, THEN A REFINANCE
OPPORTUNITY AT A MUCH LOWER
INTEREST RATE IS JUST COMMON
SENSE.
>> ONLY THE RAUNER
ADMINISTRATION CAN MOVE FORWARD
ON BORROWING.
MENDES SA SENT LETTERS TO THE
GOVERNOR.
ONE RIGHT AFTER THE BUDGET
PASSED OVER THE GOVERNOR'S
OBJECTIONS IN JULY AND ANOTHER
ON THE 28TH OF LAST MONTH.
BOTH STRESSING THAT ILLINOIS IS
SPENDING $2 MILLION A DAY PAYING
INTEREST.
REPUBLICANS OFTEN USE THE
FIGURE, TOO, DURING THE BUDGET
IMPASSE.
WHILE IT WOULD NOT WIPE IT OUT
IT COULD MAKE A DENT AND ENABLE
THE STATE TO STOP ACCRUING
INTEREST.
MENDOZA SAYS THE GOVERNOR'S
OFFICE GAVE NO RESPONSE TO HER
LETTERS.
INSTEAD OF GOING FORWARD HE IS
DRAGGING HIS FEET.
>> WHAT DOES THE GOVERNOR HAVE
TO SAY?
>> FUN NEW YOU ASK.
HE HELD A PRESS CONFERENCE AND I
ASKED HIM WILL YOU COMMIT TO
MOVING ON THIS BOND ISSUE?
HERE WAS HIS RESPONSE?
>> BORROWING ON STOP OF THE
SPENDING BEHAVIOR OF THE STATE
GOVERNMENT IS NOT AN OPTIMAL
ANSWER.
WE WILL BE WORKING TO REFINANCE
CERTAIN DEBT.
BUT, AGAIN, ONE OF THE FLAWS IN
OUR CURRENT BUDGET IS THERE WAS
NO APPROPRIATION FOR PAYING DOWN
DEBT.
AND TO GO TO MARKET AND TELL
BOND BUYERS, HEY, WE DON'T HAVE
A BALANCED BUDGET EVEN NOW AND
WE HAVE NOT MADE ANY
APPROPRIATIONS TO PAY DOWN DEBT,
WE NEED A PLAN TO REPAY THE
DEBT.
OTHERWISE WE SHOULDN'T BE GOING
OUT TO A BORROWER AND ASKING FOR
MORE FINANCING.
>> SO TO CODE THAT, IT CERTAINLY
DOESN'T SOUND LIKE THE GOVERNOR
IS ANY HURRY TO GET IT DONE NOW
OR MAYBE EVER.
ANOTHER REPORTER ASKED RAUNER IF
YOU CAN BORROW THE A4% INTEREST
INSTEAD OF PAYING 12%, DOESN'T
THAT SAVE THE STATE MONEY, WHY
NOT GO FOR IT?
HE REPEATED WHAT YOU JUST HEARD.
I THEN TRIED ASKING BOTH RAUNER
AND SPOKESWOMAN WHAT HE MEANT BY
REFINANCING CERTAIN DEBT.
I DID NOT GET A DIRECT ANSWER.
HIS SPOKESMAN SAID THAT RAUNER
WORKED WITH THE COMPTROLLER TO
ADDRESS THE BACKLOG AND THAT THE
GOVERNOR'S OFFICE IS WORKING TO
SAVE TAXPAYER DOLLARS TO CUT
DOWN ON FUTURE DEBT.
THE GOVERNOR'S OFFICE SAID THAT
THE COMPTROLLER DOES HAVE THE
ABILITY TO BORROW $600 MILLION
FROM CERTAIN STATE FUNDS AND USE
THAT MONEY TO PAY DOWN THE BILL
BACKLOG.