What's Plan B? Lawmakers fail to pass budget that had no tax increase

News-DemocratMay 23, 2014 

The Illinois House on Friday rejected a "doomsday" budget that was based on an expiration of the temporary increase in the state's income tax.

House Speaker Michael Madigan said afterward that his Democratic caucus would try to put together another spending plan, and that he'll continue trying to round up enough votes to make the tax increase permanent.

The House voted down the $34.5 billion budget proposal by a tally of 107-5.

The new plan was developed after it became clear earlier this week that there aren't enough votes in the House to make permanent the temporary tax increase.

The temporary, 67 percent increase in the income tax is scheduled to roll back in January, reducing state revenue by $1.8 billion per year.

The new budget proposal was intended to motivate lawmakers opposed to the tax hike to rethink their position by demonstrating what some have called the "doomsday" impact of losing that revenue.

Madigan said afterward that he will work toward another spending plan that doesn't rely on the tax hike and that can get the 60 votes needed for House approval. The plan also will need support from the Illinois Senate.

"In short order we'll have yet another budget proposal that will provide a good level of state services without an extension of the tax increase," the Chicago Democrat said.

Gov. Pat Quinn and fellow Democrats who lead the House and Senate had been pushing for a spending plan based on making the tax hike permanent. The House last week approved a $38 billion budget that was built on keeping the temporary tax in place.

The tax increase is costing the typical taxpayer about $1,100 this year.

Quinn says letting the tax hike expire would require "massive" teacher layoffs, eliminating childcare for 41,000 children, eliminating in-home caretakers for 21,000 elderly people, and offering 50,000 fewer scholarships for college students.

Rep. Fred Crespo, who sponsored Friday's budget bill, said he didn't agree with the sharp cuts but said lawmakers need to do something before the session ends May 31.

"I'm having a difficult time reconciling people who say we don't want to extend the tax hike and then vote against this budget plan," the Hoffman Estates Democrat said.

Republicans and some Democrats oppose the tax hike. Rep. David Harris, an Arlington Heights Republican, said Friday's proposal included cuts that were unnecessarily draconian.

"We can build a better budget," Harris said.

GOP Rep. Tom Cross of Oswego said Democrats, who control both chambers of the Legislature, need to learn to live within their means. He dismissed Friday's action -- which played out in a matter of minutes because Madigan limited debate on the budget -- as purely political.

"Today is all theater," Cross said. "There's nothing substantive going on in this chamber today."

The temporary tax was approved by Democrats in 2011 and was billed as a way to improve the state's financial condition and cut its backlog of bills, which still stands at about $4.2 billion.

No House members from the metro-east voted in favor of the new budget proposal.

MILLIONAIRE TAX

After the failure of the budget vote, the House passed a measure calling for an advisory referendum on whether to increase income taxes on individuals earning more than $1 million annually.

The measure passed 64-46.

If the Senate and governor approve the measure, the non-binding referendum would be on the ballot in November. It would ask voters if people who earn more than $1 million annually should be required to pay an additional 3 percent surcharge, with the revenue going to schools.

Some Republicans said the measure would drive job creators from Illinois. The measure's sponsor, House Speaker Michael Madigan, D-Chicago, said it would raise about $1 billion annually.

Rep. Mike Bost, R-Murphysboro, argued that it's "easy to beat up on millionaires," and said a better referendum would ask voters whether the House speaker should be subject to term limits.

Madigan tried earlier this year to get a binding measure on the ballot to increase taxes on millionaires, failed to get the three-fifths majority necessary in the Legislature.

The move comes on the heels of Madigan's introduction last week of a different ballot question, asking if voters thought lawmakers should approve increasing the state's minimum wage to $10 an hour, and joins other questions on voter protections and victim's rights.

The slew of ballot questions is designed to drive voters inclined to vote Democratic to the polls and offset GOP gubernatorial candidate Bruce Rauner's own ballot initiative, which would ask voters whether the state constitution should be amended to limit the terms of lawmakers to eight years.

Here's how House members from the metro-east voted on the referendum:

* Rep. Dan Beiser, D-Alton: Yes

* Rep. John Cavaletto, R-Salem: No

* Rep. Jerry Costello II, D-Smithton: Yes

* Rep. Jay Hoffman, D-Swansea: Yes

* Rep. Eddie Lee Jackson, D-East St. Louis: Yes

* Rep. Dwight Kay, R-Glen Carbon: No

* Rep. Charlie Meier, R-Okawville: No

Contact reporter Brian Brueggemann at bbrueggemann@bnd.com or 239-2511. The Associated Press contributed to this report.

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