CHICAGO, March 22 (Reuters) - Illinois’ general fund budget deficit grew by 52 percent in fiscal 2017 to a record $14.6 billion as political feuding pushed the state deeper into the red, according to a report released on Thursday by the Illinois Auditor General.
The ballooning deficit, as measured on a generally accepted accounting principles (GAAP) basis, underscored the cost of an impasse between Illinois’ Republican governor and Democrats who control the legislature. That tussle left the state without complete budgets for an unprecedented two straight fiscal years.
For an interactive graphic of the deficit's growth, click: (tmsnrt.rs/2HW3mhM)
The stalemate, which also pushed Illinois’ unpaid bill backlog to a record $16.67 billion, ended last July when the legislature enacted a fiscal 2018 spending plan and $5 billion income-tax hike over the vetoes of Governor Bruce Rauner.
The comprehensive annual financial report for the fiscal year that ended June 30 showed the deficit more than doubling on a budgetary basis, to nearly $8 billion from $3.54 billion in fiscal 2016. Fiscal 2017 also marked the 16th straight year of deficits for the nation’s sixth-largest state.
Illinois’ deep financial woes have left it with the lowest credit ratings among U.S. states.
It is also paying more to sell debt than any other state. The so-called credit spread over Thomson Reuters’ Municipal Market Data benchmark triple-A yield scale was 208 basis points for Illinois’ 10-year bonds on Wednesday. That is well above the 75 basis-point spread for New Jersey, another fiscally challenged state.
On a total assets versus total liabilities basis, Illinois also fared the worst among the 43 states that had released their fiscal 2017 annual audits by mid-March. The Illinois auditor’s report showed the state at -$141.7 billion. Texas fared the best at a positive of nearly $102 billion.
Reporting by Karen Pierog; Editing by Daniel Bases and Matthew Lewis