09 September, 2017
Bruce Rauner announced Thursday he will issue $6 billion in bonds to help pay off the state's staggering $15.1 billion backlog of unpaid bills.
Governor Rauner adds that he is exercising his borrowing authority due to the state's budget still being "more than $1 billion out of balance".
IL has the nation's worst credit rating.
Illinois Comptroller Susana Mendoza is telling Illinois school districts, the check is in the mail.
Rauner says he's going to look for other ways to cut spending in order to pay off the bonds.
The move is aimed at curbing crippling interest penalties on that debt, which can cost IL taxpayers as much as $2 million a day.
Rauner's office says details are being worked out.
"It's going to give me an opportunity to provide some immediate relief to many providers who have waited an unconscionable period of time to get paid for services they've already provided to the people of IL", the Democrat said in a telephone interview. That's when lawmakers overrode Rauner's veto of the budget, enacting it.
Mendoza, whose job is to manage cash flow in the state's main checking account, praised the decision.
That means interest payments of no more than $2.5 billion over a 12-year repayment schedule for bonds compared with as much as $8 billion at the current rate.
People may have the impression that because the State of IL recently passed a budget and enacted a new evidence-based funding formula, the financial challenges facing school districts are over.
So, how does the new evidence-based funding formula work? That dispute was resolved last week.
