FAIRVIEW HEIGHTS • The Illinois Governor's budget director assured Southwestern Illinois mayors today that the state's dire financial and budgetary woes are improving. 

"We're not about to go off the cliff anymore, but we have a ways to go," said David Vaught, director of the Governor's Office of Management and Budget.

Vaught held the session with area mayors and business leaders to discuss the state's economic climate. 

Several mayors voiced concern over state delays in turning over tax money to cities. 

Tom Smith, the mayor of Waterloo, said the state is behind at least three months on income tax disbursements. 

Gail D. Mitchell, the mayor of Fairview Heights, asked Vaught about the problem on Thursday. 

"Is there any light at the end of the tunnel?" Mitchell asked. 

Vaught said the state is working to get current on its payments, but remains focused on fostering growth.  He said the top challenges for the state are pension reform, Medicaid cost containment, and economic growth.  

In addition to a multibillion-dollar backlog of unpaid bills, the state currently has an $85 billion long-term public pension shortfall and a roughly $500 million operating budget deficit, despite last year's 67 percent income tax hike.

Gov. Pat Quinn will delivered his State of the State Speech on Wednesday, and will give his annual budget speech in three weeks.

Vaught said the state is trying to "achieve a balance between cutting the budget, raising taxes, and economic growth."