Ill. House Passes Bill Allowing Borrowing by State Universities
The Illinois House on Thursday approved giving public universities the authority to borrow money to pay bills. The schools are owed hundreds of millions of dollars from the state.
The controversial change is being viewed as a temporary solution to university cash flow problems. The State of Illinois owes more than $700 million to universities... putting some in jeopardy of being unable to make payroll.
Under this proposal... the universities could borrow based on how much the state owes for the current fiscal year... which expires June 30th. When the state finally comes through.... the schools would be required to quickly pay off the loans.
Urbana Democrat Naomi Jakobsson endorsed the measure.
" When universities are able to do this short term borrowing, able to pay their staff and employees, our young people will continue to receive the world class education they should get from Illinois and that they will be able to get from Illinois", said Jakobsson.
Danville Republican Representative Bill Black concurred. Black says he understands there are concerns about schools taking on the debt ... but he sees no other available option.
"Unless you want the universities to close before the fall semester starts, I suppose you could vote no", said Black. "If you want them to stay open, I suppose as distasteful as it might be to some of us, I have no other alternative. I intend to vote for the bill."
Several lawmakers say they are concerned about allowing the schools to take on the debt... but others argue there is no alternative.
Lawmakers previously sent the Governor a plan to let community colleges establish a line of credit to also cover bills.