Still Budgetless, Illinois to Borrow Millions for Construction
By Monique Garcia
Gov. Bruce Rauner's administration plans to borrow $480 million this month to pay for construction projects.
The state plans to conduct the general obligation bond sale on Jan. 14, Rauner spokeswoman Catherine Kelly said Sunday. The money would be used for road and transit projects and to pay related costs, she said.
"Road construction and transit improvements are key factors in growing the Illinois economy, which is why Illinois is planning a bond sale in January," Kelly said in a statement.
She noted that despite the impasse that's left Illinois without a complete budget since July 1, the three major credit rating agencies have not lowered the state's general bond rating. First-term Republican Rauner wants pro-business, union-weakening legislation opposed by Democrats, who are allied with trial lawyers and organized labor.
Still, it's unclear what kind of rate the state could get with the bond sale, given the uncertainty surrounding finances. Illinois is expected to end the budget year on June 30 at least $8 billion in the red. Key programs continue to be paid for under various laws and court orders, even as the state's revenues dipped by billions following the rollback of the income tax rate hike in January 2015.
The Rauner administration would not provide an estimate of what it expects to pay for the loan, saying it's a competitive bidding process and "we will take the lowest rate offered."
Rauner's office said there was "sufficient dedicated revenues to cover the payments."
(c)2016 the Chicago Tribune