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July 21, 2010; Source: Crain’s Chicago Business | If you want to see how a state’s fiscal crisis affects the nonprofit sector, just look at the list of 136 nonprofits that are owed $1,000,000 or more by the state of Illinois.  Illinois Partners for Human Services got the list through a Freedom of Information Act request submitted to the Illinois comptroller.  As of July 12th, these nonprofits were due a combined total of $490,314,860.75 from the state.

We’ve long known that Catholic Charities, owed $8.6 million, headed the list.  Other big organizations such as DePaul University—$7.2 million—are owed big sums. But many of the groups on the list are much smaller, like the Ounce of Prevention Fund (owed $2.3 million) and Proviso Family Services ($1.5 million).  According to the Heartland Alliance, an additional 465 organizations are owed $100,000 or more.  Heartland says that the total owed to groups that provide services to families, children, the elderly, and the ill are owed a cumulative $1.3 billion as of June 30th.

The state owes money to other governmental agencies, such as the Chicago Transit Authority and the University of Illinois, but those institutions have recourse such as raising fares or raising tuitions to cover their temporary shortfalls.  Most of the human service nonprofits have less palatable options, cutting back or shutting down programs.

The solution isn’t to make it easier for nonprofits to access lines of credit so that they can float these unpaid bills.  The solution is for the state to get its fiscal house in order, pay what it owes to nonprofit service deliverers, and forgo the annual process of playing budget politics with nonprofit services.—Rick Cohen