In the spirit of promoting clear and accurate fiscal information, Truth in Accounting has once again assessed the transparency of state governments’ financial reporting. While state budgets receive most of the public and media’s attention, their outcomes are detailed in each government's Annual Comprehensive Financial Report (ACFR), which is audited annually by certified public accountants. Our transparency score is based on key criteria outlining best practices, offering government officials and citizens a roadmap to enhance fiscal transparency and accountability.

In 2013, the Securities and Exchange Commission (SEC) charged the State of Illinois with securities fraud for misleading municipal bond investors about its pension funding obligations. The SEC’s investigation found that Illinois, between 2005 and 2009, misrepresented the risks associated with its pension funding schedule when offering more than $2.2 billion in municipal bonds. The state failed to disclose that its statutory plan significantly underfunded pension obligations, thereby increasing financial risks. In 2013, Illinois agreed to a cease-and-desist order to resolve SEC charges under Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933. (link to the SEC Cease-and-Desist Order)

Public Affairs’ Jeff Berkowitz sits down for a conversation with Sheila Weinberg, Founder and CEO of “Truth in Accounting,” since 2002 and whose mission is to compel governments to produce financial reports that are understandable, reliable, transparent and correct. Sheila Weinberg received her Certified Public Accountant, also known as a CPA, credential in 1981, along with a Bachelor of Accounting degree from the University of Denver, which she attended on an academic scholarship. Ms. Weinberg’s research initiatives include “The Truth about Balanced Budgets, a Fifty State Study,” the Financial State of the States and the Financial State of the Union.

Illinois’ tardiness with its ACFR is part of why Truth in Accounting graded it an ‘F’ in its most recent Financial State of States. From that report:

The burden of debt and public pensions could soon push Chicago into bankruptcy.

Illinois certainly has its attractions: a stable workforce, world-class universities, a vast interstate highway system and one of the world’s leading airports in Chicago.

Then again, its reputation for rampant political corruption, high taxes and fiscal irresponsibility that has left the state deeply in debt don’t exactly impress job creators looking for a financially stable, business-accommodating environment in which to operate.

The unemployment rate isn’t the only disquieting news Illinoisans have received of late.

Truth-in-Accounting, the Chicago-based financial watchdog group, recently examined the financial health of the 50 states and ranks Illinois near the very bottom — No. 48.

There they go again.

The carnival barkers are on the attack, sharing more bad financial news about Illinois than some people want the public to know.

In its latest report on the financial health of the 50 states, Truth-in-Accounting, the Chicago-based financial watchdog group, ranks Illinois near the very bottom — No. 48.

As of August 31 2024, Illinois had not released its fiscal year 2023 annual financial report. Based upon the state’s last audited financial report for the fiscal year 2022, it had a Taxpayer Burden of $37,000, earning it an “F” grade from Truth in Accounting. At that time, Illinois needed $175.4 billion to pay its bills. Unfunded pensions and other employee retirement obligations continued to plague the state in 2022, and we expect the same occurred in 2023.

Our fifteenth annual Financial State of the States (FSOS) report provides a comprehensive analysis of the fiscal health of all 50 states.

According to Ives, she cited a report from Truth In Accounting to note that every taxpayer in Chicago would have to pay $42,900 to pay off the city’s debt. She also urged Democrats to "spend big in Chicago, where the sales tax rate is 10.25%, and don’t forget to visit the pot shops where sales taxes can exceed 30% on some products!"

Chicago Public Schools reported a budget gap of $500 million this year, and Mayor Brandon Johnson did not rule out a high-interest loan to cover it.

Truth in Accounting Founder and CEO Sheila Weinberg told The Center Square that the city needs to make cuts or add revenue, and she does not consider a loan as revenue.

One-party rule in action: According to the group Truth in Accounting, Chicago continues to live up to its moniker “Second City” in at least one respect: it has thesecond-worstdebt load of any big city in America—about $43,000 per taxpayer, or almost $40 billion in total.

Thus, a family moving to Chicago suddenly becomes the inheritor of almost $85,000 in liabilities. By this metric, Chicago is no longer second but has by far the worst debt burden of any major city.

— GRADING CHICAGO: Truth in Accounting, an Illinois-based group that works to improve accounting standards in government, is out with its annual “Financial State of the Cities” report today. Among the findings: Chicago’s financial condition worsened more than $206 million despite increased tax collections and federal Covid relief funds.

Truth in Accounting has once again created a transparency score for the financial reporting by state governments to encourage the publication of transparent and accurate government financial information.

"In fiscal 2022, 28 states didn’t have enough revenue to pay all of their bills, according to the 14th annual Financial State of the States report, published by the Chicago-based nonprofit Truth in Accounting.

The report provides a comprehensive analysis of the fiscal health of all 50 states based on the latest available data from states’ fiscal year 2022 annual comprehensive financial reports.

New Jersey ranked last for having the worst fiscal health and the greatest taxpayer burden. Not far behind was Connecticut, followed by Illinois, Massachusetts, Hawaii, Kentucky, Delaware, Louisiana, California and Vermont in the bottom ten.

By contrast, 22 states reported surpluses, the majority of which are led by Republican governors."

"Illinois is touting its rainy day fund, which has recently passed the $2 billion mark. However, some financial analysts say the state is lying to itself about its finances.

After an $11.5 million deposit, Illinois' Rainy Day Fund is now $2.005 billion, up from $48,000 in 2017, which would have only allowed the state to run properly for 30 seconds."

Now Available

Our annual report on state fiscal health. Debt among the states improved slightly. Going from $1.2 trillion down to $938.6 billion. 

What happened? 

How did your state do? Read the full report below. 

https://www.truthinaccounting.org/news/detail/financial-state-of-the-states-2023

Every year, for the past fourteen years, Truth in Accounting has released its Financial State of the States report which examines the financial status of the fifty states. This year our report was released on October 11, 2023. One of the data sets we reviewed is the auditors’ reports. Did the state receive an unmodified report for  their Annual Comprehensive Financial Report? Last year I wrote an article for Accounting Today explaining which states did not meet auditing standards for 2021. This is a follow-up to that article.

On Tuesday, August 1, 2023, Greg Bishop of WMAY Springfield's Morning News interviewed me. We discussed the recently unveiled budget summary for FY2024 by the Illinois Commission on Government Forecasting and Accountability (COGFA). This is a bi-partisan Commission that includes Democratic and Republican state senators and house members.