Rauner Vetoes $3.9B in Spending for Colleges, Human Services

The show of unity came as Rauner is battling a lawsuit by 82 social service providers, including Diana Rauner’s, demanding that the state pay up $130 million that is locked up in the governor’s budget standoff with Democratic lawmakers.

The reviews will examine the schools’ vulnerability to the state budget stalemate and the ability of each to operate with no state funding or reduced assistance.

Rather, the decision to allow temporary tax increases to expire and the subsequent failure to develop a budget that aligns revenues with expenditures have resulted in a marked deterioration in the state’s finances during this time of recovery. Fitch Ratings, which already rated IL at BBB+ placed the state on negative watch Thursday.

Previously, S&P had dropped only three states into the low-investment grade triple-B level: California in 2003, MA in 1989 and Louisiana in 1988. IL is roughly one-notch above junk bond status.

BlackRock Inc., the world’s largest money manager, said Wednesday that the municipal market should consider denying the state market access because of its fiscal woes. She says even more businesses and organizations that have signed contracts with IL are planning to head to court in order to receive their money.

Gov. Bruce Rauner, a millionaire businessman in his first term, is holding out for changes in law to cut business costs and restrict the power of labor unions. Democrats, led by House Speaker Michael Madigan, have rejected that.

“When the General Assembly adjourned without passing a balanced budget, the administration warned the super majority in the legislature there would be consequences”, Catherine Kelly, a spokeswoman for Rauner, said in an e-mailed statement. Case-in-point: the State is suffering from a cash-flow crisis from years of deficit spending, leading to a current bill backlog of more than $7 billion. And Moody’s downgraded the state’s worst-in-the-nation rating on Thursday, too.