For the first time in history, a state might file for bankruptcy protection.

That's what happens when you operate three years without a budget.

Illinois has a full-fledged financial crisis on its hands. Not even the lottery is safe.

Republican Gov. Bruce Rauner went so far to say Illinois is entering "banana republic" territory.

With billions in unpaid bills and pension obligations, the state has a cash crunch, the likes of which has never been seen.

Rauner has called for a special session of the Democratic-led General Assembly to pass emergency legislation.

If not, Illinois will – literally – lose the lottery and bus services, among other things.

The state's problems are years in the making. Beginning with a poorly-funded pension system, Moody’s downgraded the credit rating to the lowest of any state.

Illinois has $130 billion in unfunded pension obligations.

A backlog of unpaid bills worth $13 billion.

The state could be the first to attempt to declare Chapter 9 bankruptcy -- but under the law, that’s impossible unless Congress gets involved.

“Nobody here in Illinois is considering bankruptcy—first of all, it’s not allowed,” said Steve Brown, press secretary for Illinois House Speaker Michael Madigan. “Second of all, it would damage the reputation of the state and it’s just not necessary.”

Rep. Peter Roskam from Illinois was more pointed and political in his criticism.

“Illinois is the fiscal model of what not to do, this avoidance in behavior toward dealing with our challenges is what leads to the devastating impacts we are seeing today,” he said.

Illinois has a deadline looming. If the General Assembly cannot find common ground and pass a budget package, a compromise could be devastating for the state.

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