Illinois Comptroller: Most state payments will stop July 1 without budget

Munger said that if raising taxes were the only answer to the budget crisis, lawmakers would have to increase the income tax from its current 3.75 percent to 8 percent.

Illinois’ comptroller is sounding the alarm that if a stopgap spending measure is not passed, payments for a host of state programs and services will dry up.

Lawmakers failed to pass a budget for the coming fiscal year. For the current fiscal year they passed some short-term funding but Comptroller Leslie Munger said that funding is about to run out.

“Payments will stop when we enter the new fiscal year on July 1 if we do not take some action in Springfield,” Munger said.

Munger says typically if service providers or vendors don’t get paid, they go to the Illinois Court of Claims to compel payment.

“But without an appropriation the Court of Claims is not an option. Their only recourse would be then to sue the state,” Munger said.

Munger said that would result in tax dollars being diverted to pay legal fees instead of paying bills.

The state’s debt is so high now, Munger said that if raising taxes were the only answer to the budget crisis, lawmakers would have to increase the income tax from its current 3.75 percent to 8 percent.

“We cannot raise taxes enough to get out of the mess without driving people and businesses further out of our state and honestly I don’t know anyone on either side of the aisle that would vote to take our taxes up to 8 percent,” Munger said.

Munger said there needs to be a three-pronged approach of cuts, tax increases and reforms to grow the economy.

“There is common ground on a lot of the things we’ve talked about, that has been put on the table, and if people would stop focusing on what divides us and focus on where we can agree, I think we can get a lot of those things done,” Munger said.

Munger said lawmakers need to put the state’s interest ahead of politics.

The next fiscal year begins July 1.