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Contracts Without Appropriation: DHS Owes More Than $350 Million to Service Providers

Illinois owes 800 service providers more than $350 million under contracts the state issued but lacks the appropriations authority to pay, according to Department of Human Services data obtained by the Fiscal Policy Center. The state issued these contracts even though Governor Rauner vetoed spending bills that would have allowed the state to make good on these contracts. Without payment for the services they have provided, many organizations are struggling to survive.

In an attempt to get desperately needed emergency funding to human service programs after more than 10 months without a state budget, the General Assembly last week approved by overwhelming margins a bill for more than $700 million in funding to social services. The nearly $250 million designated for DHS programs would allow the state to pay a sizable portion of the what the state owes under these contracts. Governor Rauner has not yet said whether he will sign this bill.

Pay Now Illinois, a coalition of 64 Illinois-based human and social service agencies and companies, is suing Governor Rauner and agency heads seeking payment of more than $100 million for services provided in FY16. The lawsuit seeks to begin immediate payments of the most overdue bills. The coalition notes that the lawsuit is the “only possible basis of preventing an even more serious cutback of services” and that once “these services and programs are cut or eliminated, it will be difficult to resume them.”

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