 Republicans opposed Gov. Pat Quinn's plan to borrow $8.75 billion to
help the state pay off its debt of $9 billion to $10 billion. Quinn
wants to borrow $2 billion in short-term loans to help pay the
state's backlog of bills.Any short-term borrowing must win the OK
from both financial offices.
Rutherford, a Republican, met privately with Quinn, a Democrat,
and his budget office staff. Rutherford said he told the governor he
doesn't approve of a multibillion-dollar borrowing plan, which would
require repayment with interest at the end of 14 years.
"I told him I don't support the $8.7 billion borrowing plan,
14-year payment ballooned at the end," Rutherford said. "I said, 'I
don't support any of that stuff, but I will work with you on
short-term borrowing, which I can either sign off on that or not.'"
States were provided with about $80 billion from the federal
stimulus fund, which provides an enhanced Medicaid match rate to
hospitals and nursing homes if states make payments within 30 days.
Since March 31, Illinois' match dropped from 59 percent to 57
percent. By July 1, the match will drop to 50 percent.
"We do not want to leave over $200 million in federal match on
the table," Quinn's spokeswoman Kelly Kraft said. "We want to get
this debt restructured so we can take advantage of an extra $200
million that we could use for programs in our state. We want to get
these bills paid. And the sooner we do that, the more match we get."
The comptroller's office estimates the state has $4.7 billion in
unpaid bills as of Tuesday afternoon.
Comptroller's spokesman Brad Hahn said Topinka has discussed with
Quinn about taking advantage of federal dollars through the Medicaid
match. But at the moment, Hahn said Topinka doesn't believe in
short-term borrowing.
Lawmakers would need to approve the 2012 state budget at the end
of session on May 31, so they would have only a month to pay off any
short-term borrowing, Hahn said. Any short-term borrowing must be
paid by the end of fiscal year on June 30, he said.
"Regardless of the situation, Comptroller Topinka is always
willing to sit down and have a discussion and look at options on the
best long-term financial interests of the state," Hahn said. "But
she is certainly very hesitant on borrowing on any level, at this
point."
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Quinn needs to win support from Republicans in both chambers for
any borrowing measure, which requires a three-fifths vote. The
governor and his office have discussed solutions to the state's
budget challenges with both the treasurer and comptroller, Kraft
said.
"Our goal here, and I think everyone's goal here, is to get our
bills paid, and we want to come up with a solution so that we could
restructure our debt to get our bills paid as quickly as possible,"
Kraft said. "And so far, we feel that these discussions have been
very constructive."
Despite the personal and corporate income tax increase enacted in
January, which is expected to generate $7 billion for the state,
Quinn called for borrowing to clear out the state's pile of unpaid
bills.
Rutherford said Democratic and Republican lawmakers in
Springfield need to come together to resolve the state's finances.
"I am cautiously optimistic that before this is all over at the
end of May, that we will be able to have some kind of a reasonable
effort on the finances of our state," Rutherford said. "The two
biggest sticking points will be the public pensions and workers'
comp."
Lawmakers, meanwhile, have introduced proposals to reform the
state's public pension and workers' compensation systems.
[Illinois
Statehouse News; By DIANE S.W. LEE]
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