Senate passes bill that would include late-payment interest penalties in budget
Legislation to account for late-payment interest on Illinois' unpaid bills has been approved by the Senate.
The bill, which passed the Senate unanimously in a 57-0 vote, was spearheaded by Sen. Tom Cullerton (D-Villa Park) and crafted with the help of Rep. David McSweeney (R-Barrington Hills). The bill would require the governor’s budget to include an estimate of late-payment interest penalties beginning with fiscal year 2019.
“We are paying hundreds of millions of dollars in late-payment interest and failing to factor that into the budget process,” McSweeney said in a news release. “I appreciate the hard work of Sen. Cullerton in getting this common-sense bill passed. It is time we addressed the interest payments and get the state budget under control.”
Under the bill, late-interest payments wouldn’t be paid if the underlying contract has been voided by a chief procurement officer, an audit is being conducted or the contract is being held for review. In addition to late-interest payment estimates for the upcoming fiscal year, the governor’s office would also provide an estimate of late-interest payment projections for the next four fiscal years.
A Debt Transparency Report released by the state comptroller in January revealed that taxpayers were responsible for approximately $1 billion in late-payment interest penalties as of December of last year.