Quinn: State needs to borrow $1B

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SPRINGFIELD – With budget problems climbing, Gov. Pat Quinn said Tuesday that he soon would need to borrow another $1 billion to keep state government running this winter.

Quinn emerged from a meeting Tuesday with legislative leaders saying he was looking at another short-term borrowing plan to keep up government’s liquidity – having enough money to pay its bills – between November and February, when tax revenues are traditionally slowest.

“We have to have that just to have liquidity for the months of November and December, January and February,” Quinn said of more borrowing.

The governor said he would work with the comptroller and treasurer under existing state law that allows him to borrow money in an emergency. The state just borrowed more than $1 billion to pay bills this summer, and both that borrowing and the new borrowing would have to be repaid by next summer.

Quinn said state government got a low interest rate of about 1 percent on the last borrowing and could do well again.

“It’s a cash-management device,” Quinn said. “Illinois’ appeal to the banks that want to lend money is pretty good, and we want to keep it that way.”

That borrowing would be used to bump up the state’s general fund, its main bank account.

Money from that account pays for all kinds of expenses, including the MAP grant college scholarship program. Lawmakers and Quinn recently approved filling a more than $200 million gap in that program but didn’t specify how to pay for it.

Quinn said the borrowing could be used for MAP funding but said he’s not concerned scholarships would be shorted.

“I’m very confident we’ll have the money for the scholarships. That’s not a matter that anybody’s concerned about. It will be there and it will be paid for,” Quinn said.

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