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Illinois revenue down $955 mln 11 months into FY 2017
June 5, 2017 / 4:42 PM / 6 months ago

Illinois revenue down $955 mln 11 months into FY 2017

CHICAGO, June 5 (Reuters) - Illinois’ operating revenue was down $955 million as of May, while late payment penalties on overdue health care bills for its employees topped $460 million, more bad news for the cash-strapped state limping to the June 30 end of fiscal 2017 without a budget, according to a report released on Monday.

General funds revenue totaled $26.54 billion for the first 11 months of fiscal 2017, a decrease of 3.5 percent from the $27.5 billion collected during the same period last year when the state also lacked a budget, the report by the state legislature’s Commission on Government Forecasting and Accountability showed.

Personal income tax receipts were up 2 percent, corporate taxes were down 41.3 percent and sales taxes were flat so far in fiscal 2017. The three account for most of Illinois’ tax revenue.

The fifth-largest state in the United States was hit last week with two downgrades that put its credit ratings just a step above junk.

Illinois ended its spring legislative session on May 31 without a budget deal and could be headed into an unprecedented third-straight fiscal year without a complete spending plan because of an impasse between its Republican governor and Democrats who control the legislature.

While House Democrats will start fiscal 2018 budget hearings this week, Governor Bruce Rauner has told reporters he may have to call lawmakers into a special session.

The budget stalemate has ballooned Illinois’ unpaid bill pile to $14.65 billion as of Friday.

As of the end of May, that bill pile included about $4.65 billion in state employee insurance claims that have been waiting for payment for as much as 826 days, according to the legislative commission report. Illinois is on the hook for $462 million in late payment interest penalties on the unpaid insurance claims.

Some employee heath care providers and other vendors have obtained 90 percent of what they are owed by assigning their state receivables to private lending firms that are then eligible to pocket the interest penalties, under a program authorized by Rauner’s administration. (Reporting By Karen Pierog; editing by Grant McCool)

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