The Association has been taking an increasing number of calls from members – and nonmembers – asking when the state will release payments. The lag in monies flowing to community human service organizations has reached a crisis point. IARF continues to work with the Comptroller’s office to expedite payments on an emergency basis but we’ve recently been told that such emergency payments are less likely because of the state’s cash shortfall.

For those of you who have been active in managing the situation in your agency, please call if there is anything more you believe we can do to assist your efforts. If you are just beginning to feel the crunch, this basic list may help organize your thoughts on how to proceed:

Determine what payments are the most critical. Of course, you will want to prioritize payroll, insurance payments, and other items vital to client/patient care.

Develop an emergency cash flow projection so that you will know what you absolutely have to have to operate for the next 120 days. As reported at Wednesday’s Meeting of the Membership, remember that payment slow downs are likely to be a problem for the next 12 to 18 months as Illinois recovers from this fiscal crisis.

If you have not been to your bank and informed them of the current situation, you should do so immediately. If you have an established relationship with the bank, they may be willing to extend – or further extend - credit to get you through this extraordinary time.

Communicate, communicate, communicate. Let vendors know that you are experiencing a slow down in payments from the state and that as a result you are unable to make your regular payments. In this time of crisis, a phone call may be better than a letter. The personal contact will let the vendor know that you are at the mercy of the state and that you will take all reasonable action to bring the account current. Be honest in these contacts so they are not surprised.

Understand that under the Prompt Payment Act, which IARF worked with Comptroller Dan Hynes’ office to pass, you are entitled to interest on payments from the state that are not paid within 90 days. On July 1^st, that will change to 60 days for FY03 payments. Financial officers should monitor closely the timing of your payments to make sure you are receiving the interest when it’s due to your agency.

A short-term borrowing plan will take three weeks for Illinois officials to complete. Sources tell us that an agreement between the Governor, Treasurer, and Comptroller will be reached by today.

To advocate for community organizations:

IARF is calling for a special meeting with Comptroller Hynes’ staff to understand exactly how the short-term borrowing will impact the financial crisis in community agencies. We have worked this spring to keep the Comptroller advised of the looming crisis and met with him in May to urge his approval of short-term borrowing during the spring legislative session. Members will be notified immediately when we have the details of when to expect payments.

IARF is meeting with the Bureau of the Budget to seek their assistance in allowing the Department of Human Services and the Department of Public Aid to expedite the processing of payments to community human service organizations.

IARF is meeting with the Treasurer to discuss options such as the Link Deposit program whereby their office deposits sums of cash in local banks that can be accessed by non-profit organizations.

IARF is meeting with the Illinois Economic & Fiscal Commission to determine how long they project this fiscal crisis will continue. From their forecasts we will keep members informed about how payments will likely be made over the next 12 to 18 months.

IARF is updating our "Human Services In Crisis" section of the website. It is here that we are immediately posting any information that will update service providers about what is going on.

IARF will continue to work with you on an individual basis to assist you through the crisis.

These are extremely difficult times, and members – and nonmembers – should remember that IARF is here to help. If there is any way that we can be of assistance, please do not hesitate to call. We can be reached at (217) 753-1190 or by e-mail. Staff e-mails are the first initial last name (all one word) @hso.net. For example, my e-mail address is jstover@hso.net.