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Bill seeks bonds to pay off state’s past-due bills

Wed, Dec 12, 2012

Proposed legislation before the Illinois General Assembly would provide $4 billion in general obligation bonds to pay off State of Illinois bills 60 days or more past due.

Advocates seek passage of HB 6240 in late November or early December so that the state does not do what it did last year: take $1 billion in revenue to pay the previous year’s bills to its subcontractors. The legislation was filed November 7 by state Rep. Esther Golar (D-Chicago) and is before the House Executive Committee.

“We want them to use all the revenue for programs like human services, and education and health care; all these programs were shorted [in the current budget] because a billion dollars was taken off the top to pay back bills,” said Judith Gethner, executive director of Illinois Partners for Human Service, a state-wide, 700-member organization that is behind HB 6240.

Late payments from the State of Illinois have put the state’s debt burden on human service providers, Gethner said. A recent Illinois Partners survey showed that the state owes money to 57.3 percent of human service providers; nearly half of them risk closing programs in the next four months and 1 in 5 could shut down entirely.

Human service providers have had to borrow money and take on lines of credit so as not to close programs, despite state contracts that said they would be paid, Gethner said. “Why should you owe me for services I have delivered and because you haven’t paid me I have to take a loan to make payroll. This isn’t my obligation. It’s yours as a state.” she said.

Gethner said the advocates for unpaid agencies have been working roughly eight months since the primary to identify about 40 lame ducks in the General Assembly “who will do right by people in the veto session” to pass and sign the legislation into law before a new session convenes in January.

The legislation stipulates that the $4 billion would not be used for pension funds, but the new money would still save the state millions of dollars in interest on its delinquent bills, Gethner said.

Written by Suzanne Hanney, StreetWise Editor-In-Chief

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