Editor’s note: This is an important late-summer press release from one of my favorite organizations, the Institute for Truth in Accounting. Should Republicans gain ground this November, I trust they’ll realize the Institute is non-partisan and will continue to play the much-needed role of watchdog after the election.
CONTACT: Darlene Porteus, 847-835-5200
TRUTH IN ACCOUNTING ISSUES ILLINOIS’
“FINANCIAL STATE OF THE STATE”
Study Confirms State’s Financial Situation is ‘Obscene’
Chicago – Today, the Institute for Truth in Accounting released Illinois’ “Financial State of the State,” which answers the question, “Is the state bankrupt?” The Institute’s reports the state has only $20 billion of assets to cover $140.6 billion in bills —- a $120.6 billion shortfall. Each Illinois taxpayer’s share is $29,200.
This precarious financial position falls under one definition of bankruptcy —- A debtor that does not have the financial means to pay their bills as they come due. The Institute’s detailed study of Illinois’ June 30, 2009 audited financial report and retirement systems’ actuarial reports found the state does not have the $120.6 billion needed to pay for its liabilities as they come due. “The state has incurred billions of dollars of liabilities and does not have the means to meet these liabilities,” said Sheila Weinberg, founder & CEO of the Institute.
On July 2 Comptroller Dan Hynes admitted that the state did not have $5 billion to pay bills that were due. In a New York Times interview Hynes stated, “This is not some esoteric budget issue; we are not paying bills for absolutely essential services,” He underscored, “That is obscene.”
“Our study of the Illinois budget processes and financial reports found our governor and legislators continue to damage the state by not following the state budget law,” stressed Weinberg. “Their total disregard of Illinois’ balanced budget requirement has resulted in a financial hole that may be insurmountable.”
The Institute’s study revealed that each year when calculating a balanced budget the governor and legislators routinely overlook billions of dollars of payroll costs, including earned retirement benefits. Bill Gates recently called this practice “accounting fraud.” The Institute’s chair, Roger Nelson, commented, “We must stop this practice, which our elected officials have used to pretend they have balanced the budget, while not providing the necessary funding for $100 billion retirement benefits promised our state employees and teachers.”
The Illinois’ Financial State of the State can be found on the Institute’s website:
Research comments can be found at: illinois.statebudgetwatch.org.
About the Institute for Truth in Accounting:
The Institute for Truth in Accounting (IFTA) is dedicated to promoting honest, accurate, and transparent accounting at all levels of government and business. As a non-partisan, non-profit organization, the IFTA works to expose accounting deficiencies while promoting better, more accessible delivery of accurate government financial data-and, in turn, providing a foundation for more informed public policy. The IFTA provides its expertise to develop more effective accounting standards and deliver accurate government financial information to policymakers, opinion leaders, and citizens, so they can all work for a more secure financial future. To learn more, please visit our website at www.TruthInAccounting.org.
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