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Illinois governor agrees to sell bonds to pay off bills

Illinois governor agrees to sell bonds to pay off bills
From Reuters - September 7, 2017

CHICAGO (Reuters) - Illinois Governor Bruce Rauner said on Thursday the state will sell $6 billion of bonds to reduce an unpaid bill pile that ballooned to more than $15 billion during an unprecedented two-year budget impasse.

The Democratic-controlled legislature included the general obligation bond authorization in the fiscal 2018 budget it enacted in July over the Republican governors vetoes.

But Rauner last month expressed reluctance to tap that authorization despite a push from Illinois Comptroller Susana Mendoza, who contended the move was more cost-effective than continuing to accrue late bill payment penalties of as much as 12 percent a year.

Acknowledging that the state has been borrowing from its vendors and service providers, the governor said in a statement he will use the bonding authority because its better to have Wall Street carry our debt than Main Street Illinois.

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