Sullivan: 'Enough is enough. Illinois must pay its bills.'
Mon, 21 Mar 2011 18:01:02 GMT —
UPDATED: March 23 at 9:48 a.m. (video added)
A local lawmaker says it's time Illinois pays its bills, and he wants your support to borrow money to do it.
Illinois Senator John Sullivan has sent a letter to state-funded schools and universities, businesses and service providers that are owed money right now.
In it, Sullivan supports a debt-restructuring plan to pay $6 billion in past-due bills and bring the state back to a 30-day pay cycle.
You can read more about it here on his blog. Tuesday Sullivan told KHQA that requires borrowing up to $6 billon. He's gathering constituent support with an online petition...and encouraging folks to voice their support to their lawmakers.
That's important because it takes a three-fifths majority in the General Assembly to issue bonds for the state.
We talked to Senator John Sullivan Tuesday. See his complete interview here.
Is borrowing a good idea?
Sen. Sullivan said, "We're using businesses as a credit card. They're carrying this debt for us right now. And that's not right because it's having a very detrimental impact on them right now. What I'm saying is, that's a debt. Let's take that debt, restructure it and make it into a bond payment and pay it however many years it takes to do that. So really it's debt for debt."
Sullivan admits this is going to cost the state more money. Right now the state pays out little to no interest on the money it owes schools and businesses. But those entities are paying for it, in many cases borrowing from local banks to simply make payroll or keep their doors open.
Sullivan says in this case, borrowing money to pay past due debts may actually stimulate the economy.
Of course, Sullivan says robbing Peter to pay Paul isn't the end-all answer to the state's budget crisis. He says digging out of Illinois' crisis won't be pretty or easy for anyone.
Shriver asked, "You just passed a tax increase and now you want to borrow money? Where are the cuts?
Sen. Sullivan said, "That's part of the reasons I didn't support the tax increase. I've said for the last couple of years we were going to need a two-fold solution to the problem. We're going to have to make cuts and they're going to be significant and we're going to have to have a tax increase. "
Lawmakers still are trying to determine those cuts at the State capital....and right now...no one really knows how much and what will be cut from the budget.
In the interim, Sullivan says something has to be done.
Sen. Sullivan said, "If we don't do this borrowing, the only option we have is to use the money coming in from the state to pay the backlog of bills but we have bills coming in all the time, so if we try to use a portion of what we have to pay these unpaid bills, it's going to take years and years and years to get those paid off and so those businesses and entities we owe can't survive that long."
As Melissa mentioned, bonding money requires a three-fifths majority in the General Assembly, so both Democrat and Republican votes will be needed to pass legislation to borrow money.
That's why Sullivan is asking supporters to sign the petition and contact their lawmakers.
Here are some of the stories people have sent in to Senator Sullivan's Pay The Bills petition.
1) "The Quincy School District has had to borrow money on their own to simply make their payroll. This has an impact upon money available for crucial educational services. Because of the money owed to our district by the State of Illinois, Quincy Public Schools has been forced to release many teachers. This has included special education teachers, reading teachers, and classroom teachers. On a personal level, these skilled educators are devastated to lose thier job. From a district perspective, it is also devastating and completely frustrating. Children are not receiving services--including intervention services that are required by the Response to Intervention law--and this resulting in students falling behind and being at risk for academic failure. Please, please support the bond proposal!"2) "These unpaid bills forced me to lay off nearly half of my agency for awhile. It is also putting quite a strain on cash flow and meeting our payroll."3) "We have not been paid anything by the state since they finally paid all the money owed from the year before. We had to lay off 4 staff positions last year; we will need to do more this year. The impact it will have on students will be significant--not to mention the impact on the community, since we impact the economy in our area too."4) "Unpaid bills to the Quincy Public School District have resulted in cuts of over 200 preschoolers from our program in the past 2 years. This drastic reduction in preschoolers served by our Pre-K program has, and will continue to, directly affect students' readiness for Kindergarten and beyond!"5) "The Quincy Public School Foundation has voted to try to have a fundraising campaign to help support the Quincy Schools since state payments have been reduced and often not paid. We are seeing Illinois public schools becoming only tax-assisted rather than tax-supported. Therefore, to keep a quality school system, we are attempting to raise millions of dollars from private sources to restore the many services to children which are no longer tax-supported, like early childhood education, fine arts programs, and reading recovery services."Senator Sullivan says if the state does borrow money, it should be used only to pay *outstanding* bills, and only what the state can't "cost-cut" to finance.
We also tried to contact Republican Representative Jil Tracy for comment but were unable to reach her.
We also contacted Western Illinois University today.
Right now the state owes it more than 41 million dollars.
Here's what President Al Goldfarb said, "We support any attempts to make the state more solvent and reimburse us for the $41.1 million that we so desperately need."
We want to hear from you, tell us what you think about this story on our website or on facebook.
UPDATED: March 22 at 12:10 p.m.
KHQA's Melissa Shriver was able to speak with Sen. John Sullivan Tuesday and ask him to explain his proposed plan for Illinois' budget woes.
Sullivan is encouraging constituents to spread the word and voice support for Illinois to borrow money to pay off past-due bills to vendors and healthcare agencies.
He says it's not right that Illinois is essentially using state agencies as its own personal credit card.
It takes a three-fifths majority vote to borrow money, so republican support is necessary for bonding to be approved.
Sullivan started an online petition to generate conversation and support for borrowing money to pay off the state's backlog of debts. So far he says he's received a huge amount of feedback.
Melissa Shriver asked Sen. Sullivan, "How is borrowing money going to help an already cash-strapped state?" He answerd that basically we will be exchanging one debt for another debt. It will cost more, but right now Illinois pays little to no interest in our current debts. We will have to pay for it but it's the right thing to do. "If we pay the people we owe now, it will stimulate the economy."
Shriver also asked, "You just passed a tax increase and now you want to borrow money? Where are the cuts?" Sullivan responded that it was wrong to pass the tax increase without outlining all the necessary cuts. He would have preferred to do all that at the same time.
We will bring you more of this interview, so check this story later and watch KHQA's News at Five, KHQA's Evening News at 6 p.m. and KHQA's Late News at 10 p.m.
People are talking on Facebook...join the conversation here.
Illinois Senator John Sullivan issued a letter to schools, colleges and universities, social service providers, health care providers, municipalities and other local organizations who are currently owed $6 billion in unpaid bills.
In the letter, Sullivan is supporting a plan to pay those past-due bills. He acknowledged that the state balance sheets are in crisis and now that organizations have not received their funding, they are "forced to borrow from local banks or take out other kinds of loans to simply make payroll or keep the lights on."
Read Senator Sullivan's comments on his website blog .
The McDonoughVoice.com quotes Sullivan. Too many schools, health care providers, and local businesses have been forced to assume the burden of the state's failures, said Sullivan. Enough is enough. Illinois must pay its bills.
Sullivan supports a debt restructuring plan that would ultimately pay the existing $6 billion of unpaid, past-due bills and bring the state back around to a 30-day pay cycle.
He has launched an online petition where Illinoisans who are being affected can share their stories. Click here to access the petition.
Both Democrat and Republican votes will be needed to pass bonding legislation, so Sullivan is asking supporters to sign the petition.
We're going to talk to Sullivan on Tuesday and bring you more information, so if you have any questions you'd like us to ask him please let us know.
KHQA would love to hear what you think, so scroll down to leave a comment or join in on our Facebook page here .