Metro-East News

May 30, 2014

Tax increase in the fall? Senate sends 'incomplete' budget to governor

The Illinois Legislature sent a new state budget to Gov. Pat Quinn Friday that majority Democrats acknowledge puts off tough decisions about whether to slash spending or find new sources of revenue -- including possibly making Illinois' temporary tax increase permanent -- until after the November election.

Senate Democrats approved the approximately $35.7 billion 2015 spending plan, which the House passed earlier in the week, with no GOP support. The vote came as the Legislature faced a Saturday deadline to adjourn.

Democratic Sen. Dan Kotowski, a Senate budget negotiator, described the plan as "incomplete" but the best lawmakers could do this session. He said legislators will have to either find additional funds in the next year or cut at least $4.4 billion in expenses -- an amount some lawmakers say could lead to thousands of layoffs, closing facilities and slashing programs.

"I'm not trying, nor is anybody trying to hide from the fact that we face challenges," Kotowski said. "We'll need to have options on the table ... to either fill this hole or wreak havoc."

Republicans called the plan irresponsible and warned the Legislature is headed toward a repeat of 2011. That's when Democrats returned to Springfield after the fall election and voted to increase Illinois' income tax by 67 percent with the help of so-called "lame duck" legislators who were finishing out their term after not being re-elected.

"We can see what's coming like having the other team's playbook," said Sen. Dale Righter of Mattoon. "We can see this team is in the same situation that they were four years ago and they are going to run the same play."

During debate, Sen. Kyle McCarter, R-Lebanon, said Democrats were using budget gimmicks.

"And you wonder why we're not wholeheartedly participating in your shenanigans?" McCarter said. "Perhaps we just can't do math like you."

Quinn and other Democratic leaders wanted to extend Illinois' temporary income tax increase, which is set to roll back in January. But House Democrats -- all of whom face re-election in November -- couldn't get enough "yes" votes to do so this session.

Instead, legislative leaders drafted a budget that keeps funding levels flat next year for schools and most state agencies but doesn't account for increased costs.

It relies on many of the same practices that have been blamed for causing Illinois' bleak financial situation. They include relying on future increases in revenue that may or may not be realized, borrowing money from special funds to pay for day-to-day operations and delaying paying bills -- adding to Illinois' roughly $4.2 billion backlog.

The temporary tax increase raised the rate for individuals from 3 percent to 5 percent. It is set to drop to 3.75 percent on Jan. 1 -- a decrease Senate GOP leader Sen. Christine Radogno said would put about a week's salary back into the pocket of the typical Illinois family. The tax is costing the typical taxpayer about $1,100 this year.

Radogno, during a news conference Friday with Sen. Dave Luechtefeld of Okawville and other Senate Republicans, called on Democrats to pledge that they wouldn't extend the tax after the November election.

Luechtefeld said, "In 2003, the legislative majorities and Gov. Blagojevich began a 12-year saga of unbalanced, fiscally irresponsible budgets, which have now driven a backlog of bills to more than $5.4 billion. This fiscal year 2015 budget will push that bill backlog to even higher levels. Sadly, the legislative majorities have decided to pass a budget plan which simply kicks the can down the road."

He added, "This budget effectively guarantees that the legislative majorities and Gov. Quinn will force a permanent tax extension on Illinois taxpayers because of their fiscal mismanagement."

Quinn issued a statement saying lawmakers "didn't get the job done" on the budget.

"In March, I submitted a balanced budget plan that continued paying down the state's bills, protected education and public safety and secured Illinois' long-term financial future," Quinn said. "Instead, the General Assembly sent me an incomplete budget that does not pay down the bills but instead postpones the tough decisions."

Republican gubernatorial candidate Bruce Rauner said lawmakers "refused to make structural reforms needed to fix state government."

Rauner added, "This phony budget is an unsurprising, yet tragic, conclusion to five years of failure under Pat Quinn."

Related content



Editor's Choice Videos