By IRN
SPRINGFIELD – A new report on Illinois’ borrowing shows how the state’s dysfunction is costing taxpayers millions of dollars.
A University of Illinois report shows that Illinois would have saved $12 million in fees and interest on last week’s $550 million bond sale had the state kept its January credit rating. Martin Luby, assistant professor in the school of public service at DePaul University, said his report contradicts the thinking that the state got favorable deals with banks due to low interest rates.
“The state could have done much better than it actually did if it kept its credit rating and its financial condition at levels like 10 years ago when it was still rated in the AAs,” Luby said.
Luby adds that the $12 million is mainly a result of the current dysfunction in Springfield, but there’s a $70 million price tag attached to more than a decade of mismanagement.
“The $70 million number, that’s not attributed to one administration,” Luby said. “That’s a 10 year period of fiscal deterioration.”
Gov. Bruce Rauner’s administration said the bonds are intended for capital projects such as road construction. The Civic Federation said the state overpaid for a January bond sale by $43 million compared to other states with better credit.
