CBS – June 16, 2017: Illinois residents may feel some solidarity with the likes of Puerto Rico and Detroit.
A financial crunch is spiraling into a serious problem for Illinois lawmakers, prompting some observers to wonder if the state might make history by becoming the first to go bankrupt. At the moment, it’s impossible for a state to file for bankruptcy protection, which is only afforded to counties and municipalities like Detroit.
Chapter 9 bankruptcy protection could be extended to states if Congress took up the issue, although Stanford Law School professor Michael McConnell noted in an article last year that he believed the precedents are iffy for extending the option to states. Nevertheless, Illinois is in a serious financial pickle, which is why radical options such as bankruptcy are being floated as potential solutions.
Adding to the state’s financial pain is a shrinking tax base. For the last three consecutive years, Illinois has lost residents. Its population is now at its lowest in a decade. Tepid wage growth on top of fewer residents puts a strain on the state’s ability to grow its tax revenue. Link: Read Complete Article
References – Links:
[ Massive hikes for Illinois | Republican-dominated states RAISING taxes | Illinois Blows Budget Deadline, Pushing Closer to Junk Rating | Republican leader resigns amid budget crisis | Illinois credit watch | Illinois Credit Watch: On Track To Be First ‘Junk’ State | UPDATE: ILLINOIS FINANCES IN ‘MASSIVE CRISIS MODE’ ]
NJ, Maine Shut Down Govts Amid Impasses
WSJ – July 2, 2017: Governors in New Jersey and Maine shut down state government after lawmakers in their states failed to reach budget deals before Friday’s midnight deadline.
Republican New Jersey Gov. Chris Christie, who is in his final year of two terms running the state, called the Democratic-led legislature back to Trenton for a special session on Saturday. In Maine, Republican Gov. Paul LePage put in place a partial shutdown until Monday afternoon. Link: Read Complete Article