Democrats in Illinois might be letting a very winnable Senate seat go away. The latest poll from Public Policy Polling shows Alexi Giannoulias, the state Treasurer who was leading this race a month ago, now trailing Rep. Mark Kirk by 37-33.

A PPP survey taken a week and a half before the primary found Giannoulias up 42-34 on Kirk. But the closing stretch of the campaign did not go well for the Democratic nominee, with the attacks on him resulting in a final margin of victory that was a good deal less than what he had shown in earlier polls. Since then most of the news for him has been bad.

The main reason Giannoulias is behind is that he’s getting only 54% of the Democratic vote while Kirk is winning 77% of the Republican vote. It’s not that a lot of Democrats are planning to cross over and vote for Kirk, but 36% of them are undecided right now compared to just 16% of Republicans. That suggests Democratic voters don’t really know what to make of Giannoulias’ problems right now so they’re just taking a wait and see approach to the race.

It’s clear that the movement in Kirk’s direction over the last two months has nothing to do with him and everything to do with Giannoulias. A majority of voters in the state have no opinion of Kirk and his favorability spread of 24/23 is almost identical to the 27/22 he sported in late January. Giannoulias has seen his favorability drop from 31% to 21% and his unfavorability increase from 19% to 28% in that period of time.

The bad news for Giannoulias almost entirely considers his family’s Broadway Bank, which could collapse at any moment. Most recently, an extremely damaging story in the Chicago Tribune detailed the bank lending $20 million dollars to two Chicago crime figures, while Giannoulias was the senior loan officer. Giannoulias has not sufficiently explained his side of these stories to the public.

There’s clearly some time for Giannoulias to rebound, and if Democrats come home to him, he should be able to win. However, PPP’s Tom Jensen says that the top of the ticket of Giannoulias and Gov. Pat Quinn is perhaps the worst for Democrats in the entire nation. And it could lead to blowing a blue seat.