Story from the State Journal Register on the state deficit growing day by day.

Tony

Without a budget, Illinois’ spending — and deficit — balloon

By Sara Burnett, The Associated Press
Posted Aug. 16, 2015 at 9:13 PM
Updated at 9:14 PM

CHICAGO — Illinois Republicans and Democrats alike wailed when the Democratic-controlled
legislature approved a state budget last year that was more than $1 billion out of balance.
Then-gubernatorial candidate Bruce Rauner called the spending plan “phony,” while the party
in power acknowledged it was “incomplete” and riddled with gimmicks.

But the state is now on course to dig itself a far greater budget hole through either
unwillingness or inability to act on the current fiscal year’s budget. One estimate puts the deficit
at $5 billion, thanks to court- and statute-mandated spending already underway at levels that
both sides say are unsustainable.

Lawmakers say they’re not even sure how much money is going out the door. They agree that
the situation is leading Illinois — already billions in debt — to rack up more. They acknowledge
that balancing the budget gets more difficult with each passing day. Yet, like most everything
else at the state Capitol these days, they’re split along party lines as to who’s to blame and how
to fix it.

The effect on residents and businesses is clear: There’ll be a dramatic increase in what the
state will eventually have to raise in taxes, cut in spending — or both, said Laurence Msall,
president of the Civic Federation, a nonpartisan research organization.

“This is an incremental path down the road of fiscal recklessness and irresponsibility,” Msall
said.

At the center of the problem is a disagreement between the Republican governor and
Democrats over what should be included in the budget.

Rauner, a former private equity investor negotiating his first state budget, wants a package
that includes changes to curb public employee unions’ influence and reduce costs for
businesses. He says he won’t consider a tax increase until the legislature gives into some of
those priorities. But Democrats say Rauner’s agenda will hurt the middle class, and they want
to raise revenue to balance the budget without severe spending cuts.

Democrats approved a budget in May that spent almost $4 billion more than the approximately
$33 billion Illinois is expected to take in this year. Rauner signed the piece of the budget that
funds schools but vetoed the rest, saying he was trying to put Illinois on the road to “fiscal
sanity.”

He also deemed the one-month stopgap budget Democrats sent him unconstitutional because,
if applied over the full fiscal year, it would lead to an unbalanced budget.

Meanwhile, dozens of consent decrees issued by federal courts kicked in, mandating Illinois
continue to spend money on services like the Department of Children and Family Services and
Medicaid. Plus, payments to pension funds, debt service and tax refunds also are automatically
authorized by law. And Rauner and labor unions were granted a court order requiring the state
to continue to pay its employees at their normal salaries; Democratic Attorney General Lisa
Madigan had objected.

Ninety percent of what the state usually spends has been authorized despite having no
approved budget, an analysis by Senate Democrats concluded. They say if spending continues
at this rate, Illinois is on track to spend about $38 billion this year, leading to a $5 billion deficit.

The Rauner administration didn’t dispute the numbers but blamed House Speaker Michael
Madigan and other Democrats for supporting a “failed status quo.” Rauner this week called the
situation “very tragic.”

“We’re spending at levels that are unaffordable … racking up more debt, more liabilities, more
unpaid bills, that’s raising our interest costs and our overall costs,” he said Thursday in Peoria.

Madigan says it’s Rauner who has forced the state to spend money by seeking pay for state
workers and approving the schools budget. The House revenue committee will continue
hearings Monday to try to determine how much the state is spending — something all involved,
Rauner’s staff included, acknowledge is a mystery.

“Are we spending money at a $32 billion rate per year? Or $34 billion rate per year or a $38
billion rate per year?” asked GOP Rep. David Harris of Arlington Heights.

When and if the two sides do reach a budget deal, they will have to raise taxes, cut spending
retroactively or make 12 months’ worth of changes in a condensed time period — making any
action both more painful and more politically difficult.


Tony Paulauski
Executive Director
The Arc of Illinois
20901 S. LaGrange Rd. Suite 209
Frankfort, IL 60423
815-464-1832 (OFFICE)
815-464-1832 (CELL)
Tony@thearcofil.org