COMPTROLLER MENDOZA CALLS ON GOVERNOR TO SIGN BIPARTISAN LEGISLATION SHEDDING MORE LIGHT ON STATE'S LATE PAYMENT INTEREST PENALTIES
The bill would require governors to make a full accounting of these costs
SPRINGFIELD, IL — The Illinois Senate unanimously approved bipartisan legislation, proposed by Illinois Comptroller Susana A. Mendoza and sponsored by state Senator Tom Cullerton, D-Villa Park, that will require governors to identify and account for the cost of late payment interest penalties in their budget proposals.
“The bill backlog more than tripled under Governor Rauner. The state fell far behind on paying its bills, and that cost taxpayers more than $1 billion in late payment interest penalties. In fact, in the past two and a half years, the state incurred more interest penalties than in the previous 18 years combined,” Comptroller Mendoza said. “Yet the Governor hasn’t had to account for those penalties in any of his budgets. That’s not right. Governor Rauner should sign this bipartisan, transparency measure, so taxpayers can know how he, and future governors, plan to pay interest penalty costs.”
Currently, state agencies are faced with determining whether to use their appropriations for late payment interest penalties or for services. Including these now-hidden costs in the governor’s budget will ensure they are fully accounted for and will make clear what appropriations the governor wants to use to pay for them.
“This practice will force all future governors to be more realistic when presenting a budget to the General Assembly and the public,” Senator Cullerton said. “We need to make sure governors, whether they are Republican or Democrat, do not attempt to hide behind phony numbers.”
HB 5814, which passed in the Senate 57-0 Tuesday, also requires the Governor’s Office of Management and Budget to include an estimate of interest penalties in its Annual Economic and Fiscal Policy Report.
This transparency reform builds on Comptroller Mendoza's Debt Transparency Act, which passed last year with unanimous or near-unanimous veto overrides. Under that act, the Comptroller’s office publishes a monthly report that includes an estimate of the late payment interest penalties owed by the state, including on bills sitting at state agencies.
Comptroller Mendoza partnered with state Representative David McSweeney, R-Barrington Hills, and his bipartisan cosponsors in the House, where HB 5814 passed unanimously last month.
“I'm proud of my role in helping to pass the Debt Transparency Act. We must now shine light on the ultimate example of wasteful state spending – late payment interest penalties,” Representative McSweeney said.
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