Results tagged “iou”

State Controller John Chiang today said the issuance of IOUs instead of paying bills can stop on September 4th. His suggestion still must be approved by the Pooled Money Investment Board, which controls the state's cash flow, according to the Sacramento Bee. In July, California began issuing IOUs because a revised budget was not in effect. So far, 327,000 totaling $1.95 billion have been sent out. "The State of California owes a debt of gratitude to the thousands of individuals and businesses that were forced to bear the brunt of the State's chronic fiscal mismanagement," Chiang said.

So California is issuing IOUs for the first time since 1992. They carry an interest rate of 3.75%, but that's apparently on an annual basis only earning about ten bucks for every thousand you're owed. But that's not stopping people from trying to buy them on Craigslist! Unlikely it's for profit, it's probably just for the kitsch souvenir factor.

Happy New Fiscal Year! To no surprise of anyone, the state once again failed to pass the budget revision before today, the beginning of the 2009/2010 fiscal year. That means 28,742 payments, many of them tax refunds, totalling $53.3 million will be sent out tomorrow as IOUs, costing the state $3.4 billion over the next 30 years due to higher interest rates.