Investing to Reduce Illinois' Backlog

Cutting the backlog, earning enhanced investment returns, and savings taxpayers money

Overview

Under Public Act 100-1107, initiated by Treasurer Frerichs and signed into law in August 2018, the Illinois State Treasurer can invest up to $2 billion in State Comptroller-issued debt at a reduced, market-based rate. This enables the Treasurer's Office to:


  • Help the State of Illinois offset significant late payment penalties;
  • Generate enhanced investment returns for the State; and
  • Assist the Illinois Comptroller in paying vendors on a timely basis.

By offsetting payment penalties required under the State Prompt Payment Act, the Treasurer's investment program is expected to save Illinois residents up to $200 million each year when fully funded.


Currently, late-interest penalties on the bill backlog are as high as 12%. Under the new program, the Treasurer's Office can purchase State debt at a more reasonable, market-based rate, thereby helping pay off the bill backlog and saving hundreds of millions for Illinois taxpayers over a five-year period.

Picture of the Illinois State Capitol

Rep. David Harris, a Republican from Arlington Heights, called this “one of the most creative and innovative programs to save money that has ever come before the House.”

Matured investments table