Historic Budget Balance Creates Opportunity For Rainy Day Fund
FOR IMMEDIATE RELEASE
July 1, 1999
SPRINGFIELD -- Governor George H. Ryan said today that the record year-end general funds balance of $1.35 billion for Fiscal Year 1999 gives the General Assembly an opportunity to create a "rainy day fund" without changing any budget plans for Fiscal Year 2000.
The Fiscal Year 1999 balance is the highest end of year cash balance in state history, breaking the old record by $149 million. Ryan said the state expects to end Fiscal Year 2000 with a balance of $1.3 billion.
Fiscal year 1999 marks the eighth consecutive year that the end-of-year general funds balance has improved, and the third consecutive year that the balance is sufficient to pay lapse period spending, resulting in a positive budgetary balance.
"In light of this historic balance, I again urge the General Assembly to create a "rainy day" reserve fund for times when the state and national economies are not as strong as they are today," Ryan said.
"We have a golden opportunity in Fiscal Year 2000 to do a lot of good for the people of Illinois -- to improve education, create jobs, enhance social services and bolster public safety. But we also will be prudent fiscal managers, and I believe part of that obligation is to start saving in case the economy weakens," the governor added.
During the spring legislative session, Ryan joined State Treasurer Judy Baar Topinka and Comptroller Daniel W. Hynes in calling for the creation of a rainy day fund, however the concept stalled in the General Assembly.
"I agree with Governor Ryan on the establishment of a "rainy day" fund. I believe this is a wonderful opportunity to set money aside should the economy decide to change directions, especially when it will not drastically cut into programs and services. I appreciate Governor Ryan's support of this fund and hope that we can work toward that end in the next legislative session," said Treasurer Judy Baar Topinka.
Ryan noted that the Illinois FIRST initiative approved this spring by legislators is designed, in part, to enhance and strengthen the Illinois economy by creating jobs, improving schools and supporting infrastructure improvements to make the state a more attractive site for new and expanding businesses.
When the legislature adjourned in May, the Fiscal Year 1999 balance was projected to be $1.0 billion. The higher balance can be attributed to revenues exceeding estimates by about $110 million, $140 million in lower-than-projected spending and another $100 million in spending that is expected to occur during the lapse period.
Fiscal Year 1999 lapse period spending is now projected to be $850 million, similar to the Fiscal Year 1998 level. Lapse period spending is spending that occurs during the first 60 days of the fiscal year from prior appropriations.