Comptroller Quarterly

              Through the first half of fiscal year 2009, the
state’s cash flow position continued to deteri-orate
in spite of receiving $1.4 billion from a
short-term borrowing on December 22, 2008.
At the end of December, the backlog of
unpaid bills in the Comptroller’s Office stood
at $1.844 billion while last year payables
totaled $1.720 billion. Just as important, the
delay in paying bills was 48 business days at
the end of December compared to 34 days at
this time last year. Both the backlog and the
number of days delayed are record highs for
the mid-point of the fiscal year.
The chart of adjusted General Revenue Fund
(GRF) balances shows the balance on
December 31, 2008 to be a negative $1.710
billion. This is the lowest end of December
balance in history and throughout the first six
months the adjusted balances have been con-sistently
lower than previous years. A few
factors have had a major impact on the cash
flow position – the state’s economy-driven
revenues have weakened significantly,
including gambling revenues, and spending
has continued to grow.
Base spending through December was up
5.8%. This growth was due to a $764 million
increase in education grants (including teach-ers
retirement), and growth of 5.2% in opera-tions
spending which includes increased
retirement contributions.
While base revenues decreased 3.6% in the
first half of fiscal year 2009, it is the decline
in economic revenue sources that presents the
greatest threat to the state’s financial stability.
Corporate income tax receipts were down
4.1% and sales tax receipts decreased $81
million or 2.2% with December receipts
accounting for most of the decline.
Base Revenues
At the end of the second quarter of fiscal year
2009, base revenues decreased $477 million
or 3.6% for a total of $12.942 billion. State
sources of revenue were down $453 million
or 4.1 % while federal sources decreased $24
million (1.0%). The growth in income taxes
that began years ago has ended. At the end of
December, income taxes had increased $3
million with individual income taxes up $29
million (0.7%) while corporate income taxes
declined $26 million (4.1%).
With the recession impacting economy-driv-en
revenues, December sales tax receipts fell
$68 million. Sales tax receipts through six
months decreased $81 million or 2.2%. In
addition, a minor adjustment to sales tax
deposits last year accounted for some of the
decrease in December receipts this year.
Cash receipts from other sources decreased
$118 million or 7.3% due primarily to expect-ed
declines in investment income (down $84
million or 71.8%), inheritance tax receipts
(down $56 million or 28.0%), Cook County
IGT (down $22 million), and corporate fran-chise
tax (down $10 million).
★★★★★ ★★★★★
DECEMBER REVENUES FAIL AS
RECESSION IMPACTS FINANCES
CQ
THE ILLINOIS STATE
DANIEL W. HYNES, COMPTROLLER Edition 30, January 2009
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