(The Center Square) – Even though the state’s Constitution requires it, Illinois hasn’t passed a truly balanced budget in decades.
The state’s former comptroller says the situation has worsened to the point of bankruptcy if it were allowed.
Former Illinois Comptroller Leslie Munger, in a presentation to the Governmental Accounting Standards Board last month, said politicians aren’t generally accountants or economists and often approve of mathematical slights-of-hand to claim they’re passing balanced budgets.
“It allows them to look at things and think they’re balanced and this is how we end up with a mess,” she said.
She mentioned borrowed funds being labeled as revenue as another common accounting trick the state uses to create the perception of a balanced budget. Others in state government have criticized this trick as well.
Illinois is facing more than $140 billion in unfunded pension liability, $50 billion in expected retiree health care costs, $3 billion in federal pandemic borrowing, and billions more in unpaid bills.
“We are a state that, if we could be bankrupt, we would be bankrupt,” Munger said.
Even with a slow infusion of billions of dollars in federal COVID-19 aid money, state officials have said it wouldn’t be enough to truly rightsize the state’s accounts.
There is a proposal from a bipartisan group of lawmakers that would limit state spending to economic factors. Senate Bill 589 says “the rate of growth of general funds appropriations shall not exceed the rate of growth of the Illinois median household income.” It has yet to be heard in committee.
Illinois Comptroller Suzana Mendoza didn’t respond to a request for comment on Munger’s presentation. Mendoza has warned lawmakers and others about the perils of treating federal aid like “Christmas” and using it to boost funding on pet projects.
Illinois lawmakers have until the end of June to send Gov. J.B. Pritzker a budget.
Pritzker, who has critiqued past budgets as being “balanced in name only,” is proposing a budget he referred to as balanced thanks to flat spending and closing a number of tax incentives on the state’s businesses. Like budgets in the past, he doesn’t factor in the state’s legacy debt as Munger suggests. It does propose statutorily-set contributions.
Munger wasn’t as vocal when her ally, former Gov. Bruce Rauner, proposed budgets that made assumptions about unrealized savings. The Civic Federation estimated Rauner left a $3.4 billion hole in his 2017 budget plan.
