Unable To Pay Bills, Illinois Sends "Dear Contractor" Letter Telling Firms To Halt Road Work On July 1

Tyler Durden's picture

Authored by Mike Shedlock via MishTalk.com,

The state of Illinois has not passed a budget for close to three years.

Arguably it’s just as well because Illinois budgets for decades have been nothing but a moth-eaten collection of lies, one time deficits repeated endlessly, and financial wizardry statements designed to disguise Illinois’ real problems: failure to rein in spending coupled with a very business unfriendly environment.

As Illinois’ bond rating careens towards junk, Illinois Unpaid Bills Jumped to $14.3 Billion. Today, the state told contractors to halt roadwork other than that required for safety.

Dear Contractor

I do not have a link, but here is the letter in image form.

This does not raise much alarm in Illinois has these kinds of letters went out last year as well. It’s simply business as usual in Illinois.

My IDOT contact, who wishes to be left unnamed, reports …

Hello Mish


Last year when they did this the extra work bill to the state cost millions of taxpayer dollars. At the last minute, the shutdown was averted but not until the shutdown measures were employed and thus extra cost was due to contractors and consultants.


Look out for the Road Builders Association to come out with an estimate of what it will cost this time around after the letter today.


Last year, the supplier for paper and toilet paper had not been paid and thus various offices were reportedly cut off of supply. IDOT employees were going to have to work from home due to the potential unsanitary conditions.

Five Illinois Universities Rated Junk

Yesterday, the Illinois Policy Institute reported MOODY’S DOWNGRADES 7 ILLINOIS UNIVERSITIES, 5 ARE JUNK.

Everybody wants to blame the downgrades on the state’s current budget impasse. The stalemate of nearly two years has led to cuts in state appropriations to Illinois universities. But the universities’ financial difficulties started before the state’s budget gridlock and are largely of their own making. Illinois colleges and universities have long overspent on bloated bureaucracies and expensive compensation and benefits, prioritizing administrators over students.


For years, university and college officials across the state have hiked tuition to pay for administrative hiring sprees, generous executive compensation and out-of-control pensions. Their spending priorities distorted university finances long before the budget impasse began.


The number of administrators in Illinois’ universities grew by nearly a third (31.1 percent) between 2004 and 2010. At the same time, faculty only increased 1.8 percent, and the number of students only grew 2.3 percent.

Illinois Tuition Fees

Retirement Costs Soars

Blame Who?

It is easy to blame Governor Rauner, but he is last on my list. Illinois has been in trouble for decades. The state’s only solution has been to tax, and tax, and tax.

That is precisely the same position as Chicago Mayor Rahn Emanuel.

The result is easy to predict.

Illinois’ Economic Growth is Worse than During the Great Depression

Illinois’ total state economic activity has increased by only 4 percent since 2007, which is lower than the U.S.’ 10 percent GDP growth during the worst decade of the Great Depression according to the Illinois Policy Institute.

Illinois Employment

Feed Me

Illinois Debt Backlog

It took $31.6 billion of new tax revenue to reduce the backlog of bills by $1.3 billion. But the complete picture is much worse as Illinois’ pension debt rose more than $25B from 2010 through 2015.

Failed State

  1. On June 4, 2017, Politico reported How Illinois became America’s failed state.
  2. The Heratige Foundation beat Politico to the idea by a mile with its September 28, 2015 analysis Illinois: The Anatomy of a Failed Liberal State.
  3. The Chicago Tribune is behind the times with its January 3, 2017 analysis, Illinois in danger of becoming a failed state.

Illinois is not in danger of becoming a failed state, it is a failed state. I have been talking about this for years.

Five Desperately Needed Reforms

  1. Municipal bankruptcy legislation
  2. Pension reform
  3. Right-to-Work legislation
  4. End of prevailing wage laws
  5. Workers’ compensation reform

Number one on my list of Illinois reforms is bankruptcy legislation. It is the only hope for numerous Illinois cities whose hands are also tied by union-sponsored prevailing wage laws.

Despite massive gains in the stock market since 2009, Illinois pension plans have gotten deeper and deeper into the hole.

Even a modest pullback in the stock market will sink numerous Illinois pension plans. I expect much worse than a modest pullback.

Tax hikes are not the answer. Reform is the answer, and bankruptcy reform is at the top of the list.

Required Pension Contributions to Double or Triple

Inquiring minds will also wish to consider Required Pension Contributions of California Cities Will Double in Five Years says Policy Institute: Quadruple is More Likely.

The same fate or worse faces Illinois.

Madigan Sponsored Problem 

The problem is on Speaker Madigan’s side. He insists on tax hikes first and reforms second.

Governor Rauner has held out and I support that policy. Once the governor agrees to tax hikes, no reforms will ever take place.

Illinois is Bankrupt

Illinois is essentially bankrupt. Unfortunately, there is no provision for states to declare bankruptcy.

States can default, however, and default is an easy prediction for Illinois’ public union pensions.

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agNau's picture

Illinois gave us Abe Lincoln
James Hodginkson
And now.....a new stepchild for federal taxpayers....
Federal debt creators.

Lost in translation's picture

Can't WAIT for this to hit CA.

markar's picture

As soon as tech and RE crashes. There's nothing else holding up the entire house of cards here.

deimos178's picture

I'm glad most of the ghetto rats are too poor to move out,they deserve what they voted for all these years. 

Rhetorical's picture

IIL res. Here Chicago and some of the St. Louis metro carry the state for dems but the rest of the state is red. Im not for team red or blue but  IL residents I talk to are very aware that Il is in a horrible financial situation even if they dont know how bad. Though many more are completely ignorant and wouldnt be able to even name theeir governor I know of several people wh have held off buying property in the state in favor of misourri because of its better finances. I have a small house here and will not buy any more property in the state until its budget and tax situation changes despite half of my family living here. Its just not worth it when you pay property  taxes  that excede the amount you pay for your mortgage.

Rabbi Chaim Cohen's picture

Yep ChiRaq is pretty much a black hole to all that is good and decent in this world. Amazing that one city can suck the whole state dry.

zuuma's picture


Reynolds v. Sims , 1964 - made state legislatures' districts proportional based on population vs. geographical.

That's why ShitCongo controls the fate of all other Illinois residents. To their detriment.

Everett Dirkson saw it coming & proposed a Constitutional amendment to prevent it, allowing legislative districts based on land area, similar to the US Senate.

Too bad it failed.


scintillator9's picture

If one travels away from Chicongo, Illinois is actually not too bad.

The closer one gets to Chicongo, the more the gravitational pull one feels on one's money into a black hole from "fees", "tolls" and taxes for anything and everything imaginable.

chubbar's picture

My sister, who is a FLAMING liberal, has lived in the northern suburbs for the past 40 years. About 4 years ago she called me complaining that her property taxes doubled to 20K/yr. She was going to file an abatement to see if she could get them lowered, which I'm sure didn't happen. Anyway, they have to be in the 24K range by now which is 2k/month. That's pre-fallout tax rate without the additional taxes/pension issues factored in.

Of course I mentioned in that phone call that she is getting to pay for the programs that she voted for. All those liberal programs have to be paid for by someone, guess she figured it wouldn't be her.

DocBerg's picture

Sadly, they are spreading out into the hinterlands via Section 8.  So, now our smaller and more rural towns can celebrate the same Rich Tapestry of Diversity that is destroying Chicongo.  In my town, when Daley The Younger was trying to gentrify his city for the Olympics, they were moving folks out from the projects in limousines to my town. 

deimos178's picture

landlords do not have to accept section 8. If only the smaller ones would refuse, it would be slightly less money but more freedom to accept decent paying tenants and the ability to keep the property clean and neat.

oddjob's picture

Some General contractors told me they don't pay for extras, my response was not to worry, because our company doesn't do extras. That always got some puzzled looks.

aloha_snakbar's picture

Maybe Detroit and Gary could annex IL...turn it into one hugenormous Tri-State ghetto...

motorollin's picture

Can't they auction off more senate seats?

sunkeye's picture

Just reposting b/c this made me LAUGH out loud. Love a bon mot. Bravo bud ...


motorollin Jun 15, 2017 10:17 AM

Can't they auction off more senate seats?

imapopulistnow's picture

Office of Business and Workforce Diversity......

Secret Weapon's picture

This is actually the crux of what is wrong with that state.  All form and no function.

ShrNfr's picture

"Department of Business and Workforce Diversity"? That title speaks volumes as to why there is a problem to begin with.

Stuck on Zero's picture

They are all under the direction of the Redundant Department of Redundancy.

gregga777's picture

Well, they have to have some place to put all of those incompetent Affirmative Action, know-nothing, do-nothing nothing burgers.  Right?

Pork Rind's picture

I got out of Illinois just in time. People are running away from the violent Jew mobster Rahm Emannuel, the Jew mayor of Chicago and all his Israeli trained police. I fled to south Tennessee 3 years ago. I had some dumb Jew-lover on this site tell me that there was no such thing as south Tennessee, the dumb Jew-lover  thought that Tennessee was two-dimensional

Spine of Ruprecht's picture

Folks, Rahm Emannuel is Chicago's first Jewish mayor.  Fact.  Mr. Pork Rind could add "ish" to the end of "Jew" and sound a little less incindiary, but he's right.

Crash Overide's picture

I am trying to get out of Illinois now, Wisconsin, Tennesse, or Kentucky maybe...

Pork Rind's picture

Where you want to move is somewhere no one wants to move to, and where no one wants to move away from. I believe I found it here.

Ricki13th's picture

The next financial/economic crisis is already here. But hike away Yellen.

how_this_stuff_works's picture

She gotta bump raise up before she can lower them again.

2banana's picture

In the end...

There will be cities/states that having growing populations, growing economies, affordable taxes and curtailed public unions.


There will be cities/states that have declining populations, decimated economies, insane taxes and thousands and thousands of abandoned homes.

BeepBeepRichie's picture

welfare and unions... works great!

2banana's picture

The Free Sh*t Army - The voter base of the democrat party.

Unions - Especially public unions - The money base of the democrat party (unions are 7/10 of the top all time donors to political parties and nearly 100% of that money goes to democrats)


Top All-Time Donors

OpenSecrets.org's historically researched organizations

1              Service Employees International Union $275,412,282

2              Fahr LLC               $165,892,107

3              National Education Assn               $120,014,556

4              Las Vegas Sands               $113,640,508

5              American Fedn of St/Cnty/Munic Employees      $108,716,015

6              American Federation of Teachers             $92,701,401

7              Renaissance Technologies           $92,588,914

8              Carpenters & Joiners Union        $92,079,559

9              Laborers Union $84,977,603

10           National Assn of Realtors             $84,197,517






cn13's picture

I left Chicago in 2010 and laughed all the way down to Georgia.

Except here in Atlanta I found this city is just as broke as Chicago.

My property taxes just went up 60% overnight.

I am no longer laughing.

gregga777's picture

Well, you discovered that there is no difference between a northern big city and a southern big city.  Avoid all of the big cities in all states because they are bastions of Demo-Marxist communism.  Almost every big city has their very own captive Free Shit Army that votes for them as long as they keep the welfare benefits rolling in every month.  The political parasites tax the crap out of working, productive people until they vote with their feet and leave.  Look at Chiraq, Illiinois, Baltimore, Murderland, New Jack City, New York, Atillanta, Georgia, LACALIFUSA, Kalifornia, etc.  

Rabbi Chaim Cohen's picture

Stay away from big cities. Find a small city and reside at least 50-100 miles from it whenever possible. Hint: you're looking a the lower mid-west and the middle southern states. Coastal states are completely off limits for the time being.

CJgipper's picture

That's why you go to a free state like TN that doesn't have a large non-native population.

Nick13_ro's picture

Maybe next time move a corporate run area, not a municipality where people can vote in local elections. Perhaps the company has more sense in how they fleece the sheep, just saying.

lolmao500's picture

Now if California could go kaput too that would show the commies that maybe their system is bullshit?

yellowlight4570's picture

I think California has a bigger ball of string than the next failed State, Connecticut. We may even beat IL to bankruptcy. 

Everything is this story can easily said about CT.

Herodotus's picture

Illinois will thrive without a state government.

Jethro's picture

That is doubtful. Illinois voted in the government they wanted. It is a culture problem, and this is the inevitable result of 50 years of socialist programs. Most northerners seem to absolutely adore socialism, and being provided for, and guided by, the government. The mindset is one in which they feel entitled to the earnings of others, and they destroy the culture wherever they immigrate to (ostensibly to escape what they've created).

withglee's picture


Herodotus Jun 15, 2017 10:30 AM

Illinois will thrive without a state government.

Vote up!


Vote down!

[J] Jethro Herodotus Jun 15, 2017 10:44 AM

That is doubtful. Illinois voted in the government they wanted. It is a culture problem, and this is the inevitable result of 50 years of socialist programs. Most northerners seem to absolutely adore socialism, and being provided for, and guided by, the government. The mindset is one in which they feel entitled to the earnings of others, and they destroy the culture wherever they immigrate to (ostensibly to escape what they've created).

[WG] When I lived there (the first 30 years of my life), Illinois was two states ... Chicago, and downstate Illinois ... but had just one government ... Chicago's lap dog. Downstate Illinois was a very good and principled place to grow up then. Chicago created with the same kind of behavior as NYC ... really really ugly.

In time, the Chicago infestation permeated the whole state.

An ounce of prevention is worth a pound of cure. A stitch in time saves 9.

Iterative secession is the first step to fixing this: ... first from the global government, then from the national government, then from the state government, then from most county governments. Get democracy down to groups of 50 people or less. That's the only way it works. Use a hierarchy to deal with over reaching issues. With just 6 levels the entire global population can be democratically represented ... with no government at all.

HK21E's picture

Wrong. Illinois got the government Chicago liberals wanted shoved up our asses. This is a red state held hostage by that flaming piece of shit on Lake Michigan, who gets damn near 50% representation in the General Assembly by virtue of the millions of parasites that nest there. 

Downstaters are fucked, but we are just along for the ride.

Bloodstock's picture

Let's be honest. The voting is rigged in IL, just like national.

Hundreds of thousends of dead people vote in Shitcago!

Jethro's picture

One thing is certain. Hodgkinson will be voting democrat for decades to come.

silvercity's picture

Let's be honest, who you get to vote for is rigged in every county in every state so voting doesn't matter; until Donald came along and showed how it could be done.

silvercity's picture

The historic difference between Democrat and Republican politicians has been that Democrats promise some benifit to their constituants while Republicans only promise to leave their constituants alone. For middleclass and upper middleclass, being left alone was a good thing. For the poor and lower working class, the benifits offered were inticing. Been that way since the 1840s when it was decided that wages equals property and thus the working poor were given the vote. Donald Trump broke ranks and promised benifits if elected. If republicans want to continue to win they will have to promise benifits and then actually deliver. Prior to Donald the only thing that Federal Republicans had promised was more war. More war is not a winning platform.

RiverDrifter's picture

Illinois DOT is a bastion of ineptitude anyway, doubt it'll have much of an effect.  The short stretch of I-94 going from Indiana border through Chicago is, has been and always will be a cluster-fuck of epic proportions.  The roads in IL have never been in even decent shape & they've never figured out how to build a road that can hold up to the freeze/thaw cycle for more than a couple years - any work they do has to be redone in a couple-three years.  

And of course, you have corrupt politicians and $1000 handshakes that keep the construction in a never-ending loop that costs taxpayers 10x what it should.  I don't know why anyone would willingly choose to live in Illinois.  The whole state sucks.

Dead Indiana Sky's picture

Or you could take the Indiana Toll Road (which just doubled their rates), and then pay another $5 for the Skyway.  It's as if they don't want us to go there.  Or maybe they just don't want any more to get out?