If Illinois’ government is going to keep burning money in a garbage can, as one lawmaker puts it, it should at least keep track of how much that’s costing us.
The wasted money — literally over a billion dollars — is cash the state shells out for high interest on overdue bills. Keeping track of that utterly wasted money is the idea behind a House bill that passed unanimously Monday. The bill would require future governors to stop ignoring how much late-payment interest is costing the state each year when they submit their annual proposed budgets.
EDITORIAL
This is a bill that absolutely should become law.
Illinois pays 12 percent on overdue bills. Because the state started falling farther and farther behind on its bills in 2014, the cost of late payments skyrocketed. Last year, the pile of unpaid bills reached nearly $17 billion, although a $6.5 billion bond issue last fall trimmed the backlog in half. It now stands at $7.4 billion, which is still way too high.
Since July 2015, the interest — just the interest — on overdue bills has totaled $1.14 billion. Last year, the state paid $143 million in late-fee payments, and it has paid $86.5 million this year. That’s money that could better have been spent on schools, transportation, paying down pension debt and other important state needs.
It was state Rep. David McSweeney, R-Barrington Hills, who said that paying 12 percent interest on overdue bills is “like burning money in a garbage can.” But until now, governors of both parties have ignored that cost when they presented their annual budgets.
McSweeney, his bipartisan cosponsors and Comptroller Susana Mendoza have partnered to make governors pay attention. Their bill, which still requires approval from the state Senate and Gov. Bruce Rauner, also would require the Office of Management and Budget to estimate late-payment interest costs when it issues its annual Economic and Fiscal Policy Report.
Once the governor includes the interest costs in the state budget, it would tie the Legislature’s hands, too. The Legislature makes changes in every governor’s proposed budget, but it could no longer join the governor in ignoring late-payment interest costs.
Last fall, this page supported a law that required the state to keep a running total of how many unpaid bills it has. Now it’s time to require public notice of how much interest those unpaid bills are costing us.
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