Illinois’ top financial officer warned state agencies during the week that they need to put the brake on spending or face the prospect of running out of money, according to Senator Jim Oberweis.
And Standard & Poor’s, one of two major rating agencies, downgraded Illinois’ credit rating to Aprior to a major bond sale scheduled for the end of January, citing the state’s lack of action on reforms to address its huge unfunded pension liability.
Moody’s, the other major rating agency, had already downgraded Illinois debt. The only other state with such a low credit rating is California, and California has a positive outlook while Illinois’ is negative.
On January 21, Illinois Comptroller Judy Baar Topinka warned that at the current spending rate, Illinois is on track to run out of funding for essential state services. The Comptroller estimated the shortfall at $1 billion and said funds for some agencies, including the Department on Aging, the Department of Children and Family Services, the state’s workers’ compensation program, and the state employee group health insurance will dry up before the end of the fiscal year on June 30.
Comptroller Topinka’s warning focused only on the current year’s budget. Earlier this month, the Governor’s own budget office issued dire predictions for state budgets over the coming three years, Senator Oberweis said.
The Comptroller recommended that state agencies create reserve funds from financially-sound programs to offset the anticipated costs. She said funds needed to fill the projected shortfall should be redirected from state agencies that have more cash on hand.
Meanwhile, a coalition of labor unions has asked for a Pension Summit with Governor Pat Quinn and the four legislative leaders in February. Controlling pension costs, Senator Oberweis said, is the single biggest challenge currently facing Illinois, which has the worst-funded pension system in the nation.
The “We are One Illinois” Coalition has asked the Governor and four legislative leaders to a summit February 11, at the Illinois AFL-CIO offices in Burr Ridge.
The group’s invitation said it “is intended to serve as a forum to share perspectives, as well as to initiate a structured process by which we can work together to develop legislation that addresses our state’s intertwined problems of inadequate revenues and underfunded pensions.”
In other action during the week, the Governor signed a law requiring schools to offer age-appropriate sexual assault and abuse prevention and awareness programs for children from pre-kindergarten through high school.
Previously in Illinois, only secondary schools were required to include sexual assault and abuse awareness education. Known as Erin’s Law, House Bill 6193 is a bipartisan measure named after Schaumburg native Erin Merryn.
A victim of sexual assault and abuse as a child, Merryn quit her job three years ago to dedicate her life to helping victims break their silence, educating children about sexual assault and abuse, and preventing them from becoming future victims. She is an author and activist currently working to get Erin’s Law passed in all 50 states.