State will pay off FY2010 bills by end of December - updated

By Jamey Dunn
UPDATE: Gov Pat Quinn confirmed Thursday that the state will pay off its fiscal year 2010 bills by the end of the month, largely through the sale of bonds against the state's tobacco settlement money.

Quinn said the backlog for FY2010 is about $1.4 billion and that service providers and vendors should expect payments soon. “They’ll get their money by the end of this year. Probably in the next week or so," he told reporters in Chicago.

Quinn also emphasized the importance of working on budget solutions when the legislature returns in January. “We also have to pay [FY2011] and beyond — [FY2012], [FY2013] and you name it. So we have to have a plan in Illinois that gets us back on sure footing when it comes to our finances, and that’s what I’m working on now with legislators of both parties.”

Illinois will make the deadline for paying off its bills by the end of this month. A new survey indicates, however, that the slow payment schedule, coupled with budget cuts, has hurt social service providers.

According to Alan Henry, director of communications for Comptroller Dan Hynes, the state will pay off all of its overdue bills from fiscal year 2010 — which ended June 30 — by the end of this month. Legislators moved the cutoff date for payments from August 31 to December as part of the budget plan passed in May.

The state prioritized paying off last year’s bills before paying for costs incurred in FY 2011. Illinois also sold $1.5 billion in bonds against the state’s money from a court settlement with tobacco companies and brought in $546 million from the tax amnesty period. Hynes warned in his quarterly report released in October that the state would have to get at least $1.2 billion from the tobacco money and $200 million from deadbeat taxpayers to make the end-of-the-year deadline.

But the results of a survey from the Illinois Partners for Human Services, a lobbying coalition that represents social service providers throughout Illinois, show that the state’s financial crisis has already taken a toll.

The group surveyed more than 200 Illinois social service providers. More than 70 percent of respondents said their efforts were affected by the late payments, with more than half cutting hours of operation or levels of services. More than 40 percent saw increased waiting lists, and more than one quarter turned clients away and/or closed programs. More than a quarter saw no changes to their services.

More than half of the organizations upped their fundraising efforts. Nearly half sought credit, and nearly half cut staff.

The report describes the compounded problem of staff cuts and an increased need for remaining staff to try to find money where they can:

Sixty percent of responding organizations sought additional funding sources, often requiring program staff to refocus efforts away from service provision. Combined with the 49% that laid off employees, these organizations are severely hampered by both direct cuts and service reductions, as well as reallocating staff to non-service specific functions.