SPRINGFIELD, Ill. – A $4.5 billion federal loan that helped the state get through the COVID-19 pandemic is officially paid back.
The loan, according to the Governor’s office and Comptroller Susana Mendoza, was used to help the state’s unemployment insurance fund, which was rapidly depleting in the early days of the pandemic.
“Paying this (remaining $1.4 billion) off early saves $20 million in interest costs for taxpayers, that they would have been on the hook for in September, had the loan not been paid off. So, this is really great news,” said Mendoza.
Mendoza says her office had been putting money aside until she got the word legislators passed a budget bill that would make the early repayment happen.
“Interest payments are money that we will never get back or be able to reinvest in economic growth, or in education, or in healthcare,” said Mendoza. “Having an extra $20 million that doesn’t have to go out the door in interest is certainly a benefit to Illinois taxpayers.”
Mendoza says other bigger states like New York, California, and Connecticut haven’t paid their COVID loans back yet.
According to a news release from Mendoza’s office, the repayment was part of a supplemental budget approved during the lame duck legislative session that involved negotiations with business and labor groups. That deal is also putting more money into unemployment and rainy day funds.
