State could give suburbs loans during budget impasse

  • Bruce Rauner

    Bruce Rauner

  • Marty Moylan

    Marty Moylan

Updated 10/20/2015 6:48 PM

As the state budget battle continues, Illinois is unable to send communities their shares of motor fuel taxes collected since July 1.

But maybe those towns could get a loan.


A memo to Gov. Bruce Rauner's budget chief says the Illinois Finance Authority is looking into what it would take to loan towns some of the money -- possibly with interest -- until the state has a spending plan and funds can start flowing again.

Some suburban mayors have expressed serious concerns about delays, complaining the ongoing budget fight between Rauner and top Democratic lawmakers will hamper their local operations. Loans could help cover the motor fuel tax money and 911 service fees owed to towns, the memo says.

"The authority is reviewing terms for potential direct loans to local governments in anticipation of future distributions, with a goal of minimizing the interest and transaction costs incurred," the memo, written by Illinois Finance Authority Executive Director Chris Meister, reads in part.

It's unclear how much such a program would cost local governments or the state.

Specific terms would need approval by the authority board, the memo reads.

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The idea comes as a Democratic effort to start sending towns some gambling and gas taxes owed by the state made headway Tuesday, but not enough to immediately help mayors.

The legislation from state Rep. Marty Moylan, a Des Plaines Democrat, would release the funds that have been withheld from towns since Illinois began its fiscal year without a budget July 1.

It also would start Illinois Lottery payouts, which have been stalled during the budget battle as well. The Illinois Math and Science Academy in Aurora, which has raised concerns about even having a spring semester should a state spending plan not be approved, would get money in the plan, too.

Moylan argued that money, along with the local revenues suburbs have been counting on for months, isn't part of the state's general checkbook and should be spared from the funding shutdown.


Democrats on a House committee agreed, sending Moylan's plan forward for more debate. But it went no further Tuesday, and lawmakers aren't expected back at the Capitol in Springfield until next month.

The Daily Herald reported this week that Illinois gamblers have lost $227 million to machines at bars, restaurants and gas stations in the first 90 days of the state budget impasse, but local governments have received none of the $11.3 million in taxes due to them.

Casino towns have fared worse, with Elgin, for example, missing out on $1.8 million in local taxes so far.

"This is starting to sting a little bit here," Elgin Mayor David Kaptain said.

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