Illinoisans seen slipping into state-created financial sinkhole
Illinoisans are sinking under mounting state debt, and the future doesn't hold any hope for a lifeline, the founder of the nonprofit Truth in Accounting said on "Chicago's Morning Answer" radio show recently.
Illinois has just over $25 billion in available assets to pay more than $235 billion in unpaid bills, according to the group's annual "Financial State of the States" report. That kind of inequity puts Illinois into the "sinkhole" category of the report.
Sheila Weinberg, founder and CEO of Truth in Accounting, said Illinois' debt burden of $210.4 billion equates to $50,400 per taxpayer, a per capita increase of 11 percent from last year.
“These are taxes that taxpayers are going to be burdened with paying in the future, and they’re not going to receive any government services or benefits for those taxes,” Weinberg told radio hosts Dan Proft and Amy Jacobson. "
Proft is a principal of Local Government Information Services, which owns this publication.
Based on the group's findings, Illinois is in a worse financial bind than every other state in the country except New Jersey.
“We’re looking at all the assets on the audited financial statements and the money needed to pay bills," Weinberg said.
Some $138 billion of Illinois’ debt comes from unfunded pensions and $44 billion comes from unfunded retiree health care debt. Bonds and other liabilities account for the rest, according to the report.
“A lot of people focus on pensions, but they (the state government) are putting some money aside to pay for those,” Weinberg said. “The retiree health care debt – they haven’t hardly put any money aside for those.”
According to Weinberg, Illinois uses cash basis accounting to come up with a balanced budget, which is a deeply flawed method
“It’s misleading and doesn’t report your true expenses and revenue," she said. "States that make billions of dollars use this antiquated accounting system to hide the true cost of government."
Weinberg said the financial crisis in Illinois is getting worse quickly.
“As the last budget negotiations prove, it makes things very messy and very ugly and people do suffer,” Weinberg said.