From the Institute for Truth in Accounting…
Illinois Reps. Karen May & and Tom Morrison Support The Truth in Accounting Act
Illinois Rep. Karen May (D-58th District) and Rep. Tom Morrison (R-54th District) joined Sheila Weinberg, CEO and founder of Institute for Truth in Accounting at a December Legislative Workshop in Highwood. The group discussed the Illinois budget, governmental accounting rules and the use of ‘political math’ to balance the budget.
Weinberg highlighted how ‘political math’ is used to disguise Illinois’ true ‘Financial State of the State.’ ‘Over the years budget shenanigans have been used to hide more than over $120 billion of state employees’ retirement and other costs,’ Weinberg added.
Rep. May supports the work of the Institute and stated ‘Part of the legislative process is education.’ She recommended the Institute work with Rep. Carol Sente’s (D-IL-District 59) Performance Based Budgeting Committee, as the Illinois legislature needs a better understanding of the true costs of government.
Rep. May called for hearings of the Pension Committee in the Illinois legislature after allegations of municipal employee salary ‘spiking’ in her home town of Highland Park. She developed a 7-point plan to stop these pension abuses, which includes the idea of a new Inspector General to look at local pension systems and the creation of an ‘accountability portal’ on municipal websites to provide transparency on pension issues.
Rep. Morrison is a newly-elected state representative from Palatine, and supports the Truth in Accounting Act in the Illinois legislature.
Without the true numbers, you, as our elected officials, do not know the true financial consequences of your decisions. You are making decisions without all the facts!
Most state and local governments have balanced budget requirements. For decades elected officials have used accounting shenanigans to claim that they have met this requirement. As a result most state and local governments are millions, if not billions of dollars in debt, including enormous retirement promises. Citizens cannot figure out how governments can claim balanced budgets, but go into debt at the same time.
It all depends on how you count. When calculating a balanced budget elected officials often misidentify loan proceeds as revenue; create revenue by moving money from one fund to another; and overestimate revenues and underestimate expenses.
Most governmental budgets are calculated on a cash basis. This basis is good for keeping track of cash and works well for incumbents who fail to plan beyond the next election. Cash budgeting allows them to promise expensive programs without identifying how to pay for them. The full cost of future benefits, especially those promised employees, is ignored.
To promote financial transparency and to provide the public and elected officials with a comprehensive picture of the total activity of government and the long-term effects of current policy, the Truth in Accounting Act would require governments to prepare their budgets using F.A.C.T. (Full Accrual Calculations and Techniques). Most important this legislation would strengthen the elected officials’ ability to determine compliance with the intent of their balanced budget requirement, which is to preserve inter-generational equity.
What Can You Do?
How can you help stop the use of political math?
1) Educate yourself about federal and state revenues and spending — ask your legislators for the real numbers.
2) Help bring F.A.C.T. based budgeting into your governments.
3) Support the Institute for Truth in Accounting by volunteering with us or providing a donation. We need funding to help calculate true state deficits, and to provide the resources needed to spread the word about F.A.C.T. based budgeting and accounting.
About the Institute for Truth in Accounting
The Institute for Truth in Accounting (IFTA) is dedicated to promoting honest, accurate, and transparent accounting at all levels of government and business. As a non-partisan, non-profit organization, the IFTA works to expose accounting deficiencies while promoting better, more accessible delivery of accurate government financial data—and, in turn, providing a foundation for more informed public policy. The IFTA provides its expertise to develop more effective accounting standards and deliver accurate government financial information to policymakers, opinion leaders, and citizens, so they can all work for a more secure financial future. To learn more, please visit our website at www.TruthInAccounting.org.