* Subscribers were told about this idea earlier today, but it turns out that the Sun-Times also has an editorial on the subject…
The state has been cutting appropriations for higher education for years, but it was not until this year that the state stopped regular payments altogether.
Since July 1, the state has made only sporadic payments on no particular schedule. At Southern Illinois University, for example, the state has paid only 23 percent of the appropriated funds. At campuses throughout Illinois, the state is $735 million behind, and as a result — just as they teach in Accounting 101 — the universities don’t have the money to pay their own bills.
The influx of second-semester tuition money in January is keeping the schools going at the moment, but that will work only until about the end of the month. That’s when the universities hit the falling-off point, the time when all the budget tricks have been played, the furloughs and hiring freezes have been announced, and there still isn’t enough money.
It doesn’t seem likely that the Legislature will suddenly find a way to balance the state’s declining revenues with its mounting pile of overdue bills. So the Legislature should approve a measure now before the Senate to allow public universities to keep going by borrowing against the money appropriated by the state but not yet paid. So far, Southern Illinois, Eastern Illinois, Western Illinois and Illinois State universities have asked for the borrowing power, and others may do so before the bill is acted on.
It’s not an ideal solution. The universities will have to pay interest on the loans, an extra cost they don’t need right now. And there’s a worry that once the universities can get money through loans, the state will divert additional dollars away from them to put out fires elsewhere.
* The Question: Should universities be allowed to borrow money based on unpaid state appropriations to help them get through this rough patch? Explain fully, please.