14 Jul 2014

Governor Quinn Announces State's Backlog of Bills Falls to $3.9 Billion

By Abdon Pallasch, Asst. Budget Director

Lowest Point Since Governor Quinn Took Office; Strict Spending Brings Backlog Down from High of $9.9 Billion in 2010

CHICAGO - Governor Quinn today announced that the state's backlog of bills has fallen from a high of $9.9 billion in 2010 down to $3.9 billion as of June 30, the lowest point since the Governor took office. Five years ago, Illinois was home to the worst pension crisis in America and the state's backlog of bills was on its way to more than $9 billion. Since taking office, Governor Quinn has made tough decisions, enacted major structural reforms and cut state spending by more than $5.7 billion.

"Making the tough decisions has moved Illinois forward," Governor Quinn said. "Today Illinois is in a stronger financial position than we were five years ago and we have more work to do to continue moving our finances in the right direction."

The backlog of bills is now closer to the typical private industry 30-day billing standard - about $2.2 billion in Illinois' case - and is a direct result of the Governor's willingness to make the tough decisions including overhauling the Medicaid program, reforming worker's compensation and unemployment insurance systems and implementing major efficiencies such as closing and consolidating more than 50 state facilities.

In March, the Governor submitted a balanced budget plan that continued paying down the state's bills, protected education and public safety and secured Illinois' long-term financial future, but legislators instead postponed the tough budget decisions.

Governor Quinn recently cut Illinois' Fiscal Year 2015 state budget, zeroing out $250 million for renovations of the state Capitol. In addition, as part of his ongoing budget review, the Governor directed state agencies to identify additional efficiencies, including selling nearly half of the state's aircraft.

The Governor also directed state agencies to cut 80 paid parking spaces for state employees in downtown garages - more than 30 percent of the total spots reserved. The move will save taxpayers more than $100,000 annually. He also again reduced lease costs for government buildings that will save taxpayers an additional $55 million this year.

Governor Quinn's budget cuts over the past five years include shrinking the state payroll from 54,000 to 50,000 - the third-lowest number of state government employees per capita in the entire country according to Governing Magazine.

For more information, please visit: http://www2.illinois.gov/gov/budget/Documents/Bill_Backlog_Presentation_7.14.14.pdf.

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14 Jul 2014

Governor Quinn Announces State's Backlog of Bills Falls to $3.9 Billion

By Abdon Pallasch, Asst. Budget Director

Lowest Point Since Governor Quinn Took Office; Strict Spending Brings Backlog Down from High of $9.9 Billion in 2010

CHICAGO - Governor Quinn today announced that the state's backlog of bills has fallen from a high of $9.9 billion in 2010 down to $3.9 billion as of June 30, the lowest point since the Governor took office. Five years ago, Illinois was home to the worst pension crisis in America and the state's backlog of bills was on its way to more than $9 billion. Since taking office, Governor Quinn has made tough decisions, enacted major structural reforms and cut state spending by more than $5.7 billion.

"Making the tough decisions has moved Illinois forward," Governor Quinn said. "Today Illinois is in a stronger financial position than we were five years ago and we have more work to do to continue moving our finances in the right direction."

The backlog of bills is now closer to the typical private industry 30-day billing standard - about $2.2 billion in Illinois' case - and is a direct result of the Governor's willingness to make the tough decisions including overhauling the Medicaid program, reforming worker's compensation and unemployment insurance systems and implementing major efficiencies such as closing and consolidating more than 50 state facilities.

In March, the Governor submitted a balanced budget plan that continued paying down the state's bills, protected education and public safety and secured Illinois' long-term financial future, but legislators instead postponed the tough budget decisions.

Governor Quinn recently cut Illinois' Fiscal Year 2015 state budget, zeroing out $250 million for renovations of the state Capitol. In addition, as part of his ongoing budget review, the Governor directed state agencies to identify additional efficiencies, including selling nearly half of the state's aircraft.

The Governor also directed state agencies to cut 80 paid parking spaces for state employees in downtown garages - more than 30 percent of the total spots reserved. The move will save taxpayers more than $100,000 annually. He also again reduced lease costs for government buildings that will save taxpayers an additional $55 million this year.

Governor Quinn's budget cuts over the past five years include shrinking the state payroll from 54,000 to 50,000 - the third-lowest number of state government employees per capita in the entire country according to Governing Magazine.

For more information, please visit: http://www2.illinois.gov/gov/budget/Documents/Bill_Backlog_Presentation_7.14.14.pdf.

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19 May 2014

Illinois pays another $1.5 billion in old bills Total backlog of bills drops to $4.2 billion

By Abdon Pallasch, Asst. Budget Director

From a high of $9.9 billion in 2010, Illinois' backlog of bills has now fallen to $4.174 billion -- the lowest it has been in years.

Governor Pat Quinn inherited a system in which one year's bills were carried over to be paid in the following year. Gov. Quinn and the General Assembly worked together to end that practice and set aside money each month to pay down the backlog that rose to $9.9 billion during the recession.

The bond ratings agencies have praised the administration's efforts as the backlog has come down, with Fitch Ratings noting, "The state prudently used higher than forecast income tax collections in fiscal 2013 to pay down a portion of the accounts payable balance."

Moody's added, "The governor's budget for the first time demonstrates how the state might decrease its unpaid bill backlog over several years. It presents a "blueprint" showing the state trimming accounts payable to about $2.2 billion, as of the end of fiscal 2019. This amount, consistent with a 30-day payment cycle, would be only a third of the backlog at the end of fiscal 2013."

"Even as outside factors have forced us to make difficult but financially sound choices in all areas of the state budget, Governor Quinn has maintained the discipline of dedicating money to pay down the backlog of bills," said Acting Budget Director Jerome Stermer.

The backlog is cyclical, generally falling in the first part of the year as income tax receipts come in and rising in the second half of the year, but the overall trend has been down as the administration, working with the General Assembly, has dedicated resources to paying down the backlog, Stermer said.

Beginning in January, on the 15th of each month, the Governor's Office of Management and Budget has posted on its website a detailed account of the backlog of bills. Traditionally, April is the strongest month for state tax receipts and for paying down old bills. http://www2.illinois.gov/gov/budget/Documents/Bill%20Backlog%20Presentation%205.14.14.pdf This April's results surpassed last April's, with the final backlog number posted Thursday $1.1 billion less than the previous April.

The administration's latest forecast for the where the backlog would finish at the end of the fiscal year on June 30 was $4.9 billion. While the backlog typically rises in May, the administration foresees no problem hitting its target for the end of the fiscal year.

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