The Illinois Vendor Payment Program (VPP): What It Covers — and What It Doesn't

The Vendor Payment Program is the most useful thing the State of Illinois offers a vendor it has not paid, and the most commonly misunderstood. Two things are worth establishing before anything else:

1. It is a real, statutory program, codified at 30 ILCS 540/8 by Public Act 100-1089, effective 24 August 2018. Before that it existed only as an administrative rule, 74 Ill. Adm. Code 900.125. The program itself commenced in March 2011.
2. It is a State-receivables program only. If the body that owes you money is the City of Chicago, Cook County, a park district or a school district, VPP is not available to you, and no Qualified Purchaser can make it available. The mechanism for that is set out at the end of this page, because it is the part nobody explains.

What VPP actually is

Under VPP, a vendor with an old unpaid State invoice assigns it to a state-approved private buyer — a Qualified Purchaser — and gets paid now instead of waiting. The purchaser collects from the State later, and keeps the late-payment interest.

The asset being sold is defined identically in the rule and the statute. A "qualified account receivable" is one that is:

"due and payable by the State that is outstanding for 90 days or more, is eligible to accrue prompt payment penalties under this Act and is verified by the relevant State agency."

Note that those are independent conditions, not one condition. Ninety days old is not the same as penalty-eligible: 74 Ill. Adm. Code 900.120 excludes whole categories of payment from prompt-payment interest — among them State employee salary, awards and grants, construction contract retainers, payments to contractual employees, tax refunds, and workers' compensation claims payments — and that list describes itself as non-exhaustive. A receivable can be a year old and still fail the second test.

CMS states the vendor-facing version as three conditions: the receivable must be "Eligible to accrue Prompt Payment Penalty interest under the State of Illinois' Prompt Payment Act," "At least 90 days past due," and "Free of any liens or encumbrances." Medical Assistance and Medicaid receivables are excluded outright — federal law restricts assigning the right to receive those payments.

The carve-out that makes it legal

This is a small point with large consequences. Assigning a State receivable to someone else normally destroys its prompt-payment interest eligibility — 74 Ill. Adm. Code 900.120(m) excludes any payment "assigned or sold by that Vendor to a different payee." The exception is written into the same subsection: "except for assignments or sales made pursuant to a vendor payment program approved by the Department of Central Management Services and the Comptroller."

In other words, VPP is the only route by which an Illinois State receivable can change hands without losing the interest that makes it worth buying.

The money, precisely

CMS markets VPP as delivering "100% value of their receivables free of cost." That is true, and it is not the whole timing picture. Both halves matter:

The advance. Per CMS's "How VPP Works", the Qualified Purchaser "will advance 90% of the invoice value to you. The remaining 10% will be paid once the State pays the invoice and prompt payment penalty to the Qualified Purchaser."

The precise version. The Program Terms define the Initial Payment as 90% of the Purchase Price, not 90% of the gross invoice — and Purchase Price is "100% of the base invoice amount associated with an assigned receivable minus: any deductions against the assigned receivable arising from State offsets," plus, at the purchaser's option, amounts you owe that purchaser for offsets applied against your other assigned receivables. State offsets include statutorily required administrative fees under the State Comptroller Act.

So: you receive 100% of the base invoice less any State offsets, in two parts.

The timing. The Initial Payment is contractually due within 10 days after the Qualified Purchaser receives the State's acknowledgement of the assignment. CMS separately tells vendors to expect a check "approximately 7 to 10 working days" after the purchaser approves the invoice. The remainder is due within 5 days after the purchaser receives full payment — base invoice plus the assigned penalty — from the State.

The cost. CMS is unusually direct: "There are no costs incurred by the vendor other than giving up the prompt payment interest accrued on the base amount." When you assign, you assign "all of its rights to payment of the qualified account receivable, including all current and future prompt payment penalties." Under 30 ILCS 540/3-2(1.05) that interest runs at 1.0% per month, or 0.033% per day, after day 90. That forgone interest is the price.

Practical mechanics

• You register with a Qualified Purchaser, not with the State. As of this writing CMS lists three on its registration page: Vendor Assistance Program, Vendor Capital Finance LLC, and Payplant.
• You may use only one. CMS states vendors "may choose only one Qualified Purchaser for the duration of the program," and the Program Terms make the lock-in contractual — you are barred from assigning to another purchaser unless yours stops participating.
• Participation is voluntary and per invoice. "The vendor may choose any number, or none, to assign to the program. Invoices are not automatically assigned."
• A purchaser's right to refuse is limited, and if it does refuse, it must give you and CMS written notice with its reasonable basis — and you have an express right to appeal that determination to CMS. That appeal right is in the Program Terms and is easy to miss.
• The purchaser must chase the interest, not you. The rule obliges each purchaser to "diligently pursue receipt of assigned penalties ... including, if necessary, seeking payment of assigned penalties through the Illinois Court of Claims." Failure is grounds for CMS and the Comptroller to terminate it from the program — without prejudice to your own right to enforce the assignment agreement against it.
• Contact CMS through the Vendor Payment Coordinator at CMS.VPP@illinois.gov or CMS.VPPInfo@illinois.gov. Use email: the phone number published on the CMS VPP pages reads "447-448-0638," which is not a valid North American number and appears to be an error on the State's own page.

It is an unusually transparent program

Worth knowing before you assign anything. Qualified Purchasers must file monthly reports with the Comptroller and CMS within 10 days of month end, itemising every receivable purchased by vendor, contract number, voucher number and State agency. They must file financial backer disclosures annually on 1 August naming everyone with a direct or indirect financial interest (30 ILCS 540/9), and disclose any lobbyist, lawyer, accountant or consultant retained to prepare them. Both sets are published — 30 ILCS 540/11 requires it, and the Comptroller hosts them on its Vendor Payment Program portal.

Public Act 100-1089 also mandated an Auditor General performance audit covering fiscal years 2019 and 2020. That audit reported five qualified purchasers operating in that period, having purchased over $2.1 billion across 6,164 receivables. Do not read those FY19–FY20 figures as current volume.

What VPP does not cover

Here is the part that sends most Illinois vendors down the wrong road.

No CMS page, Comptroller page, statute or rule says "local government receivables are ineligible" in those words. The exclusion is structural, and it is built from four layers that all point the same way:

1. The asset definition. Both 74 Ill. Adm. Code 900.125(c) and 30 ILCS 540/8(a) require the receivable to be "due and payable by the State." The rule then defines the term with no room at all: "'State' is the State of Illinois." Vendor eligibility is stated the same way — a vendor may apply "if the vendor is owed an account receivable by the State."
2. The express exclusion. 74 Ill. Adm. Code 900.120(h) removes "Payments to local government entities, including school districts" from prompt-payment interest altogether.
3. The scope of the rules. Part 900 applies "to all State agencies as defined in the Illinois State Auditing Act." That definition, at 30 ILCS 5/1-7, carries an express exclusion for "units of local government and their officers, school districts and boards of election commissioners." The same Act puts those bodies in a separate category — "Local government agencies" (30 ILCS 5/1-8).
4. The plumbing. A VPP assignment is executed inside the State Comptroller's own payment system, against a State voucher the purchaser has verified as unpaid, interest-eligible, and past voucher pre-audit. Under 15 ILCS 405/9, no payment may be made from funds held by the State Treasurer except by Comptroller warrant on an itemised voucher. A village paying its own vendor pays from its own funds — so there is no Comptroller warrant for a purchaser to be substituted into. (This last point is our reading of how the apparatus works, not a statement the Program Terms make.)

And there is no local equivalent. The Local Government Prompt Payment Act runs to Sections 1–7 and 9 — there is no Section 8 — and none of them creates a purchase program, a qualified purchaser, or any assignment mechanism. Part 900's sixteen sections contain the word "local" exactly twice, both times in the exclusions. Against a local body your statutory remedy is the 1%-per-month interest in 50 ILCS 505/4, which you must pursue yourself.

One caution about universities. Illinois public universities do fall inside the "State agencies" definition — "universities" is listed expressly. That does not automatically make a university invoice VPP-eligible: 74 Ill. Adm. Code 900.10(b) limits the rules to bills payable from funds appropriated by the General Assembly, and 900.120(k) excludes payments from non-appropriated funds, which is how much university spending is made. Ask before assuming.

Two things we could not establish from any primary source, and you should not assume either: there is no published Application Period calendar — the rule defines it only as "the time period when the program is accepting applications as determined by the Department" — and there is no published minimum or maximum invoice size for eligibility. Note also that the Program Terms CMS currently links are dated 13 December 2012, predating both the 2016 rule amendment and the 2018 statute; where they conflict with 30 ILCS 540/8, the statute controls.

Where GoVendor fits

GoVendor works with Illinois government vendors on invoice submission and tracking, and most of the vendors we talk to are owed money by cities, counties, townships and school districts — precisely the receivables VPP was never built to reach. If your unpaid invoice is a State one, ninety days past due and interest-eligible, VPP is very likely the cheapest option available to you and is worth exhausting first. Nothing on this page describes a partnership with, or endorsement by, CMS, the Illinois Office of Comptroller, or any Qualified Purchaser named.

Sources

• 30 ILCS 540 — State Prompt Payment Act, especially §§ 3-2, 8, 9, 10, 11
• 74 Ill. Adm. Code 900.125 — Vendor Payment Program
• 74 Ill. Adm. Code Part 900 (full part), especially 900.10 and 900.120
• Illinois CMS — Vendor Payment Program, How VPP Works, FAQ, Register with a Qualified Purchaser
• State of Illinois VPP Program Terms (PDF, 13 Dec 2012)
• Illinois Office of Comptroller — VPP monthly reports
• Illinois Auditor General — Performance Audit of the Vendor Payment Program (2021, PDF)
• 30 ILCS 5 — Illinois State Auditing Act, §§ 1-7 and 1-8
• 15 ILCS 405/9 — State Comptroller Act
• 50 ILCS 505 — Local Government Prompt Payment Act

Statutes, rules and agency pages read on 6 August 2026. Program details, the Qualified Purchaser list and application periods are set by CMS and change — confirm with CMS before acting. General information, not legal or financial advice.