In a sign of Illinois’ ongoing fiscal challenges, its net assets deteriorated by $8.4 billion in fiscal 2010, pushing its deficit in that category of financial reporting up to a negative $37.9 billion, according to a new report from state auditor general William Holland.If you've been reading this website for a while: we've warned you about owning Illinois state government debt:
The deficit tops all other states in the nation, according to Holland’s opinion released late last week on the state’s fiscal 2010 financial results, which are prepared by the state comptroller’s office.
The state’s asset deficit has steadily grown. Looking back to fiscal 2003, the deficit stood at $12.8 billion, rising to $20.8 billion in fiscal 2007 and $29.5 billion in fiscal 2009.
The deficit in the statement of net assets reflects the difference between Illinois’ liabilities and assets on an accrual basis. The figure takes into account the state’s accounts payable that were $9.1 billion in fiscal 2010 and $55.1 billion of debt obligations, including outstanding bonds and pension obligations. The figures provide a wider view of a state’s overall long-term fiscal health than the snapshot provided by annual budget numbers.
Illinois fares worse than any other state in an assessment of net assets of governmental activities, even among states facing sizeable general fund deficits. Only California with a $4.2 billion asset deficit, Connecticut with a $13.7 billion deficit, and New Jersey with a $28.2 billion deficit joined Illinois in the red.
Texas enjoys the largest surplus at $94.9 billion. The auditor compiled the information from the fiscal 2010 comprehensive annual financial reports of each state with the exception of Hawaii, which was not then available for review.
Barack Obama's Illinois, where a 67% state income tax increase fails to work the Keynesian magic.
