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But city won’t play hardball with state on overdue bills

The Springfield City Council has approved a resolution aimed at convincing the state to pay delinquent utility bills.

But city officials say it’s unlikely that the city will shut off service to state facilities.

“At this point, I don’t see it happening,” said Mayor Jim Langfelder after Tuesday’s council vote.

The state is City Water, Light and Power’s largest customer, and there’s no end in sight to a budget impasse that is preventing the state from paying utility bills that are piling up at the rate of $1.7 million per month. The Secretary of State paid $1.3 million in December after receiving a supplemental appropriation from the legislature, but it wasn’t nearly enough to pay the entire debt to CWLP, which now stands at about $10 million. Of that total, $6 million is considered past due and immediately payable.

City officials say they’re concerned that pulling the plug until the state pays up could result in state government offices being closed, which might result in economic hardship to the city and perhaps local businesses.

Langfelder said the state doesn’t necessarily need to pay what it owes now, but the city doesn’t want the amount of debt to increase.

If the state’s debt continues to rise, CWLP at some point would have to borrow money to pay operating costs, Langfelder and Doug Brown, CWLP chief utilities engineer, said. Neither could pinpoint the exact threshold at which the amount owed would force the city to borrow. That, they said, depends on power markets. If demand is high and the price of electricity doesn’t drop, that improves CWLP’s financial position, Brown said. If CWLP has to borrow to make up for the state’s lack of payment, the city could not recover interest costs from the state, Langfelder said.

Langfelder said that he’s working with local legislators in both the House and Senate to get the state to pay its power, water and sewer bills. State Sen. Andy Manar, D-Bunker Hill, on Jan. 13 filed a bill that would provide money to pay CWLP.

Manar said there are no guarantees. “I think it (the bill) has a difficult road ahead,” Manar said. “Some would argue that it is no more or less important than bills owed to other vendors.”

Perhaps stating the obvious, the city resolution approved Tuesday asks that the state declare utility service as being essential to keeping buildings open. On Tuesday, Langfelder told the council that if the resolution wasn’t approved, the state won’t act.

The state isn’t going to act anyway, according to Ward 6 Ald. Cory Jobe, the sole “no” vote on the resolution that passed with six aldermen in favor and three voting “present.”

“The resolution really doesn’t mean anything,” said Jobe. “This isn’t the first time the state has been late on its bills.”

Brown said that the state once went a year without paying CWLP. He said it happened about 2006 and that money was shuffled between various funds to make up for the state’s lack of payment. The matter received little or no publicity.

“They probably kept it pretty quiet,” Brown said.

Jobe, who is director of the state’s tourism office in the Rauner administration, said the resolution provides “false hope” and could set a precedent for the city relying on resolutions to compel large customers to pay delinquent bills.

Ward 2 Ald. Herman Senor and Ward 10 Ald. Ralph Hanauer, who both hold management positions in state government, said that they voted “present” because of the potential for a conflict of interest between their state jobs and their positions as aldermen. Ward 8 Ald. Kris Theilen, who works for the state Department of Commerce and Economic Opportunity, voted “yes.” He said that he was free to vote because he is a union member as opposed to a manager who works in an at-will position and has a role in setting policy. Ward 5 Ald. Andrew Proctor, who is director of legislative affairs for the state Department of Employment Security, declined comment when asked why he voted “present.”

Ward 7 Ald. Joe McMenamin, who voted “yes,” praised Langfelder’s approach.

“We have to take action now before the debt grows much larger,” McMenamin said.

Cutting off power isn’t an option, McMenamin said.

“That would do long-term harm to the city in terms of our relationships with the General Assembly, with the governor, and it could also impair our local commercial activities if local state government office buildings were closed and payrolls were shut down as a consequence of no one working,” McMenamin said.

At least two service providers have cut off the state due to nonpayment of outstanding bills. The city of Vienna, about 200 miles south of Springfield, shut off water to a pair of Department of Transportation buildings in September. Service was restored last month after the state paid its outstanding bill of $322.34 to the city, which has a population of 1,450. The Secretary of State’s office is still waiting for Comcast to reconnect cable television service after paying its bill of $2,324. Dave Druker, secretary of state spokesman, said that the office uses cable television to monitor the news.

Contact Bruce Rushton at [email protected].

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