Judge tosses lawsuit seeking Illinois bill payment

[September 01, 2016]  By Karen Pierog and Dave McKinney

CHICAGO (Reuters) - A judge on Wednesday dismissed a lawsuit filed against Illinois by a coalition of social services providers trying to force the state to pay more than $100 million in overdue bills.

Cook County Circuit Court Judge Rodolfo Garcia ruled that the fiscally shaky state, which has racked up $8 billion in unpaid bills, was immune from lawsuits of this type.

He said, however, that his ruling would allow the human services organizations to take their case quickly to the Illinois Appellate Court.

Andrea Durbin, who heads the Pay Now Illinois coalition that filed the lawsuit, said the ruling should raise concerns.

"I think that this ruling calls into question any contract anyone has with the state of Illinois," she said, adding that it means the state could hold service providers and vendors accountable for their part of a contract while refusing to pay them.

An impasse between Republican Governor Bruce Rauner and Democrats who control the legislature resulted in an incomplete fiscal 2016 budget and a fiscal 2017 spending plan that covers only six months. The new fiscal year began on July 1.

Even with the temporary budget, which included some fiscal 2016 appropriations, Durbin said some members of her group remain unpaid with no clear indication of when or if state money would begin to flow.

Garcia’s decision came more than three months after the group of social service providers, which included a child-welfare organization led by Illinois first lady Diana Rauner, sued to force the state to pay bills for work performed since July 2015. The coalition's website indicates the state now owes them more than $161 million.

Rauner's office declined to comment on Garcia's decision.

The 97 plaintiffs provide services for sex abuse victims, the homeless, senior citizens and at-risk youth. The plaintiffs argued they have suffered “acute financial hardship” due to the lack of payment.

The coalition contended Rauner's June 2015 veto of spending bills impaired their constitutional right to seek a legal remedy for nonpayment of their various contracts with state government.

(Editing by Matthew Lewis)

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