Blago blocked: Judge rules state can't siphon off funds

Only days after state treasurer Judy Baar Topinka announced she'd no longer longer approve Blago's orders to transfer money from special funds to the state's general checkbook over concerns the maneuver may be illegal, a downstate judge has granted a preliminary injunction blocking the Gov from paying day-to-day state bills with funds skimmed from special accounts earmarked for the regulation of financial institutions.

The state has hundreds of such funds, filled by special assessments and fees, that were set up to bankroll conservation programs, scholarships, financial regulation and a variety of other narrow missions.

But Blagojevich, with legislative backing, has drawn more than $400 million out of the special accounts over the last 18 months to pay day-to-day bills of government, ease the state's cash crunch and avoid a general tax increase. In his budget for the coming fiscal year, Blagojevich proposes to tie all increases in spending for schools to the so-called fund sweeps.