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July 2, 2018

Illinois budget impasse came to an end nearly one year ago when lawmakers on July 6, 2017, approved a 12-month spending plan. They followed up just weeks ago with another budget approval to cover the year that starts Sunday. And while there is general agreement that having a budget is better than not having one, it doesn't mean the state's financial problems are solved. Two challenges are the state's enormous pension debt and a backlog of bills, that while smaller than it was at height of the budget impasse, is still far higher than is considered normal for a state of Illinois' size. Mendoza said an amount in the $3 billion range "is manageable."

"They keep selling the Thompson Center every fiscal year," said Ralph Martire, executive director of the Center for Tax and Budget Accountability. "I think we've sold it five times now. They're building revenue into the budget that's just not going to materialize."

The budget also assumes more than $400 million savings from a couple of pension buyout programs in which people would give up benefits in exchange for some other compensation.

Martire noted that in the budget that ended Saturday, lawmakers assumed savings from creation of a Tier 3 pension plan that would combine parts of a traditional defined benefit plan with a 401(k). No Tier 3 plans have been developed yet.

For Martire, the biggest problem still facing the state is the roughly $130 billion owed to the pension systems.

"There's no way, no how to pay that debt back," he said.

Source: Herald & Review