Mendoza Pays Off A Quarter Of Backlogged State Bills With Bond Proceeds
Illinois Comptroller Susana Mendoza says state government has begun paying off a significant chunk of overdue bills.
Illinois owes vendors more than $16.7 billion dollars as a result of significant growth during the two-year budget standoff. Mendoza said $4.5 billion in payments – more than a quarter of the total -- went out Wednesday night.
“Two billion of that will be spent on group health insurance payments," she said. "These are folks like dentists, who have been waiting often more than two years to get paid for services already rendered."
Mendoza is prioritizing payments with higher interest rates. Illinois has to pay penalties of up to 12 percent a year on some bills.
“So we’re paying interest at 12 percent,” she said, “and we want to stop the bleeding of that."
The money to pay down the debt came from issuing bonds at a much lower interest rate. It's meant to save hundreds of millions of dollars a year.
Mendoza says she’ll pay out an additional $2 billion in the next few days.