(The Center Square) – A think tank that promotes fiscal transparency is calling on state and local governments to come clean when reporting their so-called balanced budgets.
Truth in Accounting released an update on their “State of the States” report, and also their “Financial State of the Cities.”
Illinois ranked 48th in the report with a per-taxpayer debt burden of more than $41,000. Chicago also fared poorly, ranking near the bottom of U.S. cities for taxpayer burden. The taxpayer burden is calculated by the total debt of a state or local government by the number of taxpayers within that state of municipality.
Truth in Accounting CEO Sheila Weinberg said the pandemic showed how Illinois state government uses smoke and mirrors when reporting budget numbers.
“Their credit was so bad that they couldn’t go to the bond market to borrow money when they needed it so the federal reserve actually opened up a special borrowing facility for them and they borrowed $3.2 billion, and the governor still claimed that he balanced the budget,” Weinberg said.
Illinois has been adding to its Rainy Day Fund, reaching $2 billion last year, but Weinberg said it can be misleading.
“I think a lot of times they promote those rainy day funds that have all this extra cash,” said Weinberg. “For example, California has a big rainy day fund, but they have $250 billion of debt.”
The report noted that 28 states, including Illinois, didn’t have enough money to pay their bills in 2022 with a combined $938 billion of debt.
In the newly released “Cities” report, 53 cities didn’t have enough money to pay their bills.
Pension debt totaled $175.9 billion for cities nationwide, and other post-employment benefits, mainly retiree health care, totaled $135.2 billion.
Weinberg stated, “Our findings show that these cities are facing significant financial challenges, and it is crucial for taxpayers to be aware of the true state of their city’s finances.”
The top three cities with a taxpayer surplus were Washington D.C., Irvine, California and Plano, Texas. The bottom three cities for taxpayer burden were New York City, Chicago and Honolulu.
