SPRINGFIELD, Ill. - Illinois Comptroller Susana A. Mendoza moved quickly today to use proceeds from Illinois' recent General Obligation bond sale to begin paying down a major portion of the state's current $16.7 billion backlog.
Comptroller Mendoza says she will initially prioritize those bills eligible for federal matching funds to maximize the revenues available from the $6 billion bond sale.
It will help with reducing the state's record bill backlog and end the accrual of interest penalties as high as 12% annually on many of the state's oldest obligations.
The bond sale refinances future interest costs on the state's existing debt, saving taxpayers billions of dollars over the next decade.
"As the state's chief fiscal and accountability officer, I'm laser focused on maximizing this opportunity for taxpayers," says Comptroller Mendoza. "These payments will effectively stop the bleeding of late payment interest penalties on this portion of the backlog," she says. "There is still a long, hard road ahead of us, but this is a vital first step toward smart planning for FY2019 and beyond."
The Office of the Comptroller expects to receive about $6.48 billion in bond proceeds, including a $480 million premium from the sale on top of the $6 billion initially offered. About $2.5 billion will be spent on unpaid medical bills. Close to $4 billion will be used to pay down unpaid state health insurance claims owed to medical providers in the coming days. Over the next several weeks, an additional $2 billion in federal matching funds will be applied to state medical bills.
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