Quinn suggests short-term loan to pay bills

October 29, 2009 5:40:56 AM PDT
Just like many of its citizens, the state of Illinois is short on cash.To help pay the bills, Gov. Pat Quinn is suggesting the state borrow nearly $1 billion.

As we near the end of the calendar year, that's when Gov. Quinn says the money situation really gets tight in deficit-ridden Illinois. So the governor wants to get what amounts to a "payday loan" to get through the holidays. And the law says to make it happen he'll need the approval of a political opponent and another state official running for higher office.

Quinn was out on Wednesday morning promoting the Illinois Lottery's new scratch off ticket. But the governor says his preference to generate quick cash to pay the debt-ridden state's bills for the rest of the year is a $900 million short term loan.

"We want to make sure we have proper liquidity to pay the necessary bills," said Quinn.

Illinois' budget deficit is still in the range of $10 billion. And the state is $3 billion behind in paying its bills. Quinn says Springfield would run out of money before the end of the year without the emergency borrowing.

"You can't fool around with fundamental needs of the people of Illinois, the needs of paying fundamental bills like education, health care, public safety," said Quinn.

To make a short term loan, the governor needs the state treasurer, Alexi Giannoulias, and the comptroller, Dan Hynes, Quinn's opponent in the Democratic primary, to sign off before the state sells the bonds.

"It's a back door tax increase because who do you think pays the interest rate increase on these bonds? The bond fairy?" said Dan Proft, (R) Republican candidate for governor.

Proft says taxpayers will pay again because the Democrats won't stop spending.

"We have a $10 billion budget deficit because the politicians continue to borrow against tomorrow to pay for yesterday," said Proft.

A spokesman for Giannoulias, who is running for the U.S. Senate, said, "funding higher education and ensuring we pay our backlog of bills to health care providers and others who provide critical services is a priority."

As for Comptroller Hynes,"he hasn't seen the plan so he's not going to respond to something he hasn't seen, said a spokesman.

The governor insisted that neither Hynes nor Giannoulias play politics with the loan.

"When people work together as a team there's no stopping Illinois," said Quinn. "I think it's important to keep politics out and keep the people first."

The governor says the state can short term borrow nearly $1 billion for only 1 percent interest. One per cent of $1 billion is $10 million and, as Mr. Proft says, that's taxpayer money.


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