Illinois' $5 Billion Budget Hole

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Decatur – It’s been two months since the state entered a new fiscal year without a budget.  Two months and no progress.


“It’s nonsensical,” State Representative Bill Mitchell, (R) Forsyth, told WAND’s Doug Wolfe.  “Every side needs to sit down, negotiate in good faith and solve this.”


“We need to work together,” stated State Representative Sue Scherer, (D) Decatur.  “We need to find a balanced approach.”


But it appears a solution is a long way off and at least one credit rating agency is getting nervous.


Moody's Investors Service said Monday that the stalemate underscores "weak governance" and is symptomatic of other "severe" challenges like ballooning pension payments, debt costs and dwindling revenues as a 2011 temporary income tax increase rolls back.

Moody's says Illinois' projected budget hole is about $5 billion, and addressing it will become harder if lawmakers approach the September end of the fiscal quarter without a budget deal.

The Republican governor and Democratic-controlled Legislature haven't agreed on a July 1 fiscal year budget. Money is still being spent, including through court orders.

Rating agencies have given Illinois the worst rating of any U.S. state.
 

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