A watchdog group says Illinois' current state budget represents a "lost opportunity" because legislators didn't prepare for even more grim financial realities in the years ahead.

The Chicago-based Civic Federation released its analysis Wednesday of the $35.4 billion budget that took effect July 1.

The report notes lawmakers didn't address Illinois' nearly $100 billion pension crisis. The state also continues to have billions in unpaid bills, just as a temporary income tax increase is scheduled to be rolled back on Jan. 1, 2015.

Laurence Msall is Civic Federation president.

He says legislators made some progress in paying down the bill backlog thanks to an unanticipated increase in income tax revenue. But he says they "failed to prepare for the extreme financial challenges everyone knows are on the immediate horizon."

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