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Accounting group slams response to Illinois' financial crisis          Send a link to a friend

[AUG. 9, 2006]  NORTHBROOK -- Some things just aren't what they seem.

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

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