A group headed by Paul Volcker and Richard Ravitch will argue in a report tomorrow that Illinois’s budget is unsustainable and threatens growth in the fifth-most-populous state.
The report from the State Budget Crisis Task Force, which includes policy analysts and politicians and was formed in 2011, will show how “past fiscal choices and future threats challenge Illinois’ ability to meet its population’s basic needs,” according to a press release. Volcker, a former Federal Reserve chairman, and Ravitch, a former lieutenant governor of New York, are co-chairmen of the group’s advisory board.
Though Democratic Governor Pat Quinn helped push for increases in personal and corporate income taxes in 2011, the state carried a backlog of about $8 billion in unpaid bills. Illinois has been downgraded this year by both Standard & Poor’s and Moody’s Investors Service. Both companies have the state at their sixth-highest grades.
Illinois’s retirement system has 43.4 percent of assets needed to cover promised obligations, the lowest among U.S. states, according to data compiled by Bloomberg. It has borrowed $7.2 billion since 2010 to plug the gap, pushing the state’s obligation to fund the systems out to 2019 rather than making the contributions from current funds.