CHICAGO -- Gov. Jim Edgar of Illinois last Friday said he would consider additional short-term borrowing to speed up the payment of old bills, but only if the General Assembly approves budget cuts next month to help stem a budget shortfall.
The illinois Bureau of the Budget earlier this month said the state is facing a shortfall of as much as $520 million in its $13.4 billion general funds budget for the fiscal year that began July 1. It cited lagging tax revenues and higher-than-expected spending on entitlement programs.
After meeting with legislative leaders on the shortfall, Gov. Edgar said the only option he would not consider is a tax increase. He added that he will only consider short-term borrowing if lawmakers approve at least $350 million of budget cuts when they reconvene in January.
The Illinois comptroller's office last Friday said the state had $977 million of unpaid bills, but a general funds cash balance of only $46 million. The state already borrowed in the short-term market once this fiscal year. In August, Illinois issued $185 million of general obligation certificates and used the proceeds to pay bills.
Gov. Edgar warned that even if $350 million of cuts are made next month, lawmakers might have to make more cuts before the fiscal year ends on June 30, 1992, if the economy does not pick up.