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This is the case with the Illinois state "balanced" budget. With
fiscal 2005 financial statements released in an untimely fashion, a
full year after the fiscal year ended, and after a "balanced" budget
was passed, the fact still remains that Illinois suffered a $2.1
billion deficit in fiscal 2005, the largest in the nation. John
Filan, Gov. Rod Blagojevich's budget director, tried to gloss over
this devastating aspect of the Illinois' financial crisis, noting in
July, "The state's financial condition isn't as bad as those (the
financial statements') numbers suggest." The Institute for Truth in
Accounting, an Illinois accounting watchdog group, wholeheartedly
disagrees.
"We would say that it is worse than those numbers suggest," said
Sheila Weinberg, the institute's chief executive officer. "The
state's balance sheet shows a negative governmentwide financial
position [of] $17.5 billion. Per the footnotes, our state's
financial hole is $44.1 billion if you include the actuarially
determined pension liability. Illinois has this large financial hole
despite the fact that the governors and legislative members have
claimed balanced budgets for more than 20 years. Based on this track
record, Illinois residents have reason to doubt whether the FY2006
or FY2007 budgets were truly balanced."
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 Weinberg also disagrees with Filan's statement that said Illinois
is taking in more than enough money each year to pay its annual
expenses. "If you look at cash coming in the door versus cash going
out, the state budget is balanced," Weinberg said. "This is because
the state deferred other expenses, including $1.6 billion of
Medicaid payments. I won't say my budget is balanced if I didn't
have enough cash to pay all of my current bills. Mr. Filan referred
to cash because it can be easily manipulated by holding payment of
outstanding bills and increasing receipts by borrowing money. But
the fact remains the same: Illinois has a $44.1 billion accumulated
deficit that continues to increase by billions of dollars a year."
Apparently, things are exactly how they appear.
[From the Institute
for Truth in Accounting]
The Institute for Truth in Accounting, founded in 2002, is a
nonprofit organization with no political affiliations. The mission
of the institute is to enhance the credibility of financial
reporting in the public and private sector by encouraging the
issuance of understandable, reliable and relevant information.
For more information about the institute or to request the
publication "Illinois' Grande Illusion: A Guide to Bringing Truth to
the Illinois Budget," visit
www.truthinaccounting.org.
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