CHICAGO — While its revenues have picked up, Illinois still faces "staggering long-term financial challenges" as it carried $7.4 billion in unpaid obligations — including $3.8 billion in bills owed to schools, transit agencies, health care providers and others — into the new fiscal year, according to Comptroller Judy Baar Topinka.

The amount of unpaid bills at the close of the fiscal year on June 30, $3.8 billion, is down from $4.7 billion a year earlier, The state saw a pickup of revenues thanks in large part to an income tax hike approved midway through the fiscal year, according to the comptroller's quarterly report published Friday.

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