Diana Rauner’s nonprofit among group again suing governor, state

A coalition of social service agencies — including Illinois first lady Diana Rauner’s early childhood education nonprofit — on Thursday filed suit against Gov. Bruce Rauner, Comptroller Susana Mendoza and three state agencies asking for the state to begin “timely payments” for services under binding contracts dating back to last year.

Pay Now Illinois, which also filed suit last year to try to seek payments, filed in downstate St. Clair County, where a circuit court last year ruled the state must pay its state employees.

The group says state employees haven’t missed a check, and neither should they. The suit comes after Illinois Attorney General Lisa Madigan filed a motion to try to halt state worker pay without a budget. And a partial budget that expired on Jan. 1 left appropriations for social service agencies and universities without resources.

“Why should state workers be paid but not state contractors? The state must provide assurance that it is a responsible business partner,” Pay Now Illinois spokeswoman Andrea Durbin said in a statement.

The group of 37 Illinois-based human and social service agencies and companies says they’re facing “severe cash squeezes” and that 40 percent of the groups filing suit are using or have fully expended their lines of credit. Some are experiencing liquidity issues; others reducing staffing and services.

The suit also claims the state’s failure to pass a balanced budget is unconstitutional, removing the security to contract holders that they will be paid.

The suit claims that a stopgap measure that ended Jan. 1 allowed the state to pay some contracts “but did so by reducing or terminating funding of contracts for fiscal year 2017.”

Listed as defendants are Rauner, Mendoza, Department of Human Services Secretary James Dimas, Department of Aging Director Jan Bohnhof and Department of Corrections Acting Director John Baldwin.

Rauner’s office declined to comment on the suit. And Mendoza on Thursday aimed to put pressure on the governor to propose a budget so social service agencies wouldn’t be left in the dark.

“Social service providers would not have to file these lawsuits – and the state’s most vulnerable would not have to go without services – if the governor fulfilled his constitutional duty to propose a balanced budget the General Assembly could then act on,” Mendoza said.

A Cook County judge last year dismissed a lawsuit filed by Pay Now Illinois, at that time with 96 social service agencies including Diana Rauner’s Ounce of Prevention Fund. The group sued the state and Rauner for $161 million in missed payments and interest incurred during the budget impasse. That case is now being appealed.

In a motion to dismiss that case, the state argued only Gov. Rauner and the General Assembly could take action to ensure payments to the agencies’ contracts.

The attorney general’s office essentially argued the payments were barred by sovereign immunity, meaning the state is immune from civil suit or criminal prosecution.

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