Workers’ compensation is a significant cost to Illinois taxpayers and drains scarce tax dollars from government coffers. A previous report in this series estimated the direct cost of workers’ compensation to state, county and municipal governments is $402 million in worker payouts per year.1 Building upon those findings, this report estimates that the total cost of workers’ compensation to...View Report
Illinois universities have hiked tuition and relied on state subsidies to pay for exorbitant administrative salaries – and now they’re feeling the effects of that destructive behavior.
Illinois lawmakers should heed Moody’s Investors Service’s warnings about the state’s precarious economic health and dire fiscal situation and enact major structural spending reforms to balance the budget.
The New York-based credit agency cited the lack of action on a budget as the primary reason for the downgrade.
Standard & Poor’s sent Chicago Public Schools’ credit rating deeper into junk territory in the wake of the new $9.5 billion teachers’ contract. The ratings firm said the new contract will make the district’s financial crisis worse.
The ratings agency cited the city’s “considerable growth” in pension debt in its Oct. 28 downgrade to A3 from A1.
The ratings agency also warns that another downgrade could be coming if the state doesn’t enact serious reforms to improve its fiscal condition.
Another credit downgrade shows borrowing, taxes and bailouts can’t fix CPS’ financial crisis, but real structural reforms are needed.
Major ratings agencies have assigned a negative outlook to Illinois. To move forward, the state can’t pass just any budget – especially one that’s $7 billion out-of-whack – to get beyond its crisis. With today’s fiscal stress, a bad budget is worse than no budget. A budget without reforms will only allow Illinois’ debt to continue to spiral, putting investors – and more importantly, Illinois residents – at risk.
The city’s rating from Fitch is now just one notch above junk status.
The district’s borrowing does take pressure off of the district’s immediate cash-flow problem. However, it does nothing to solve the CPS’ long-term financial crisis and its structural imbalances – in fact it only makes things worse.