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A vote for this budget is “a vote for the tax increase”

Wednesday, May 14, 2014

* From BlueRoomStream

[GOP state Rep. Dennis Reboletti] says Dems are putting the cart before the horse by passing a budget assuming the tax hike will stay in place.

Yep.

* AP

Democratic lawmakers are moving forward with a 2015 budget that is based upon an extension of Illinois’ temporary income tax increase. […]

The move to approve the budget one of political expediency for Democratic leaders in the statehouse, as passing a budget before endorsing a tax increase could serve to force the hand of several vulnerable lawmakers who are on the fence about voting for a permanent tax rise. […]

“I think that a vote for this budget is effectively a vote for the tax increase,” state Rep. David McSweeney, a Barrington Hills Republican said.

All true.

* Finke

Rep. Jack Franks, D-Marengo, an opponent of extending the tax increase, said House leadership has been polling members to gauge support for extending the tax.

“I don’t think they have the votes,” Franks said. “I’ve been doing my own polling and talking to members. I think they’re short.”

Franks also said he doesn’t see how the budget plan “has any validity whatsoever” since it is based on a tax extension that hasn’t been approved.

Yep.

* Dave Dahl

An idea floating around the Capitol is to pass the larger budget now, then save the tax vote for after the election and let whoever is elected governor then deal with it.

State Rep. Frank Mautino (D-Spring Valley), a member of the House Revenue and Finance Committee, is not on board with that. “I would hope that before we left here on May 31 and voted on the budget that we would have our revenues set for next year,” he said, adding that the uncertainty, to say nothing of the reduction of income, would damage school districts expecting state money.

Let’s hope they don’t leave town with a completely phony baloney budget.

* Illinois Public Radio

[Democratic Rep. Greg Harris] says the revenue aspect of the budget will be handled separately. Extending the tax hike has been controversial, but Harris says the focus ought to be on what he calls the “important government services” that are at risk.

He also has a point.

- Posted by Rich Miller        


31 Comments
  1. - DuPage - Wednesday, May 14, 14 @ 10:41 am:

    Even Rauner now says things like “gradual and steps” when he talks about the tax reduction. I think it would be a safe bet the tax will be there at least an extra year or two. Maybe permanent.


  2. - Walker - Wednesday, May 14, 14 @ 10:47 am:

    “If this is what you want, this is what you have to pay for it.”

    or

    “If this is all you want to pay, this is what you have to lose.”

    Two different approaches. At least they provide some clarity on the table. And they can highlight how much many legislators want to avoid the realities and just look good.

    But both give and get should be decided this month.


  3. - dupage dan - Wednesday, May 14, 14 @ 11:05 am:

    It’s hard to do your job with so much scrutiny, isn’t it? Do it anyway.


  4. - A guy... - Wednesday, May 14, 14 @ 11:14 am:

    This crew is notorious for spending money they don’t have. Now it’s as transparent as it could ever be. If you support them with your votes, you deserve more of this. Every business person who has to triple collateralize to get a loan to grow business must be dizzy at the sight of this.


  5. - Ahoy! - Wednesday, May 14, 14 @ 11:22 am:

    Eventually maybe someone will start talking about a phasing out of the income tax over a longer period of time? Might be more palatable, it certainly is to me as a voter and taxpayer.


  6. - independent - Wednesday, May 14, 14 @ 11:32 am:

    The budget as being considered is rational, the extension of the income tax must be passed. Illinois economy cannot take the blow that rolling back the tax will cause. Just 2% to maintain the state funding in education, health, human services and public safety is a good deal. Without it it we will become like Kansas which cut taxes and thier economy is tanking even faster.


  7. - Arizona Bob - Wednesday, May 14, 14 @ 11:33 am:

    @ahoy
    =Eventually maybe someone will start talking about a phasing out of the income tax over a longer period of time? Might be more palatable, it certainly is to me as a voter and taxpayer.=

    There already is a “phasing out” period in the current tax increase package. The GA had a couple of years of 5% tax to get current on Bills and pare down deferrable and unnecessary spending, and they just used this period to increase spending and avoid real reform and making the hard decisions on the least painful budget cuts.

    Any temporary extension would accomplish nothing. They’d just kick the tough decision can down the road.

    Now’s the time to get a sustainable,honest and comprehensive financial plan in place. The only way this happens is if the GA is forced to do it this year because the money won’t be there next year, or the year after.


  8. - Formerpol - Wednesday, May 14, 14 @ 11:36 am:

    Revenues up $1.8 billon; budget ‘hole’ without tax increase is about $1.8 billion, per the Tribune. SO what is the problem? Let tax increase sunset as promised, and NO NEW SPENDING!


  9. - Westward - Wednesday, May 14, 14 @ 11:43 am:

    Reminds me of the conundrum of younger years: I can’t get a job w/o experience and I can’t get experience w/o a job!! I love hearing the term “fiscal cliff” 20x a day when debating the budget and short term fixes. It’s not my job to offer up solutions. But I will offer this: political side shows and blaming each other gets nothing done. Taxes suck. But so do no public services, crappy roads, and “fiscal cliffs!” Quit worrying about re-election, do the right thing, and quit grandstanding. Do your job, everyone.


  10. - Robert the Bruce - Wednesday, May 14, 14 @ 11:44 am:

    Could they pass two versions of the budget - one version that would take effect if the tax hike expires and one version that would take effect if the tax hike stays in place?

    Then the version that assumes that the tax hike expires would be so draconian that, post-election, they could keep the tax hike in place.


  11. - Rich Miller - Wednesday, May 14, 14 @ 11:50 am:

    ===Revenues up $1.8 billon; budget ‘hole’ without tax increase is about $1.8 billion, per the Tribune. SO what is the problem?===

    Your numbers.


  12. - Arizona Bob - Wednesday, May 14, 14 @ 11:54 am:

    What should any SERIOUS plan include?

    Educational spending reform legislation to get the rate of increase of cost per student in K-12 down to inflation rate, or less. This involves “sunsetting” some mandates, limiting teacher strike powers, and shifting pension cost for new employees, excessive salaries, and end of career “spikes” that unfairly add pension expenses for decades without appropriate retiree and employer contributions back to schools and municipalities.

    Reducing medicaid costs by eliminating those who should be ineligible from the rolls, and actually verifying Obamacare Medicaid applications. Also put in a system to check for fraud before medical bills are paid, dumping the “pay and chase” policy. If DHS can’t get results by these checks within 6 months, lay them off and outsource the work again.

    Clearly identify grant spending as “need” vs “want”. I suspect most of the grants are just pork that the communities can do just fine without.

    Seriously look at road maintenance issues and move forward with those that need urgent attention and defer those that are deferrable. Stop pork “revenue sharing” beyond sales and motor fuel taxes to commmunities.

    No new “tollroads to nowhere” or expansions with Illinois funding until the budget is sustainable.

    Require higher education to validate that they are running efficiently and productively. Colleges like Chicago State that have lousy grad rates and have had certification problems either need to change or be closed down. A decent JC may provide better ed than some, and maybe those patronage driven bastions should be shut down if they can’t get the job done.

    Higher ed also needs too smartly stick to their core functions of instruction and research and be something less of local pork fests for former terrorists (Ayers and that guy a NIU come to mind)

    Student tuition and fees should be paying the true cost of their instruction, not the bloated patronage careers of people like jim edgar and friends and money losing research that doesn’t deserve, and can’t get, outside funding.

    These are just common sense actions anyone serious about solving Illinois fiscal problems would take.

    That means we’ll see little of that with the current GA.


  13. - Anonymous - Wednesday, May 14, 14 @ 12:02 pm:

    If the top state income tax for people

    in Iowa is 8.98% on income over $68000,
    6% in Kentucky for incomes over $75000,
    6% in Missouri for income over $9000, and
    7.65% for income over $225000,

    it might be argued that Illinois’ 5% income tax is a little on the low side for some people.


  14. - Anonymous - Wednesday, May 14, 14 @ 12:04 pm:

    (and 7.65% for income in Wisconsin over $225000)


  15. - Westward - Wednesday, May 14, 14 @ 12:10 pm:

    Has it ever occurred to anyone but me, maybe the vast majority of us live outside the means of what we really need to exist? It’s simple economics to me: buy what you can afford. Quit going to the bank and asking for something you really have no business buying. The bank would give me a loan for an Escalade. But is that logical given my income? Heck no. The phrase, it’s always been this way, needs to stop. Real and hard solutions need to be made and I don’t think our legislators, nor the general voting population, realize real sacrifice is needed across the board. Talking about cutting this or that but having no effect on you is wrong. Wake up.


  16. - Montrose - Wednesday, May 14, 14 @ 12:21 pm:

    Arizona Bob Said:

    “Clearly identify grant spending as “need” vs “want”. I suspect most of the grants are just pork that the communities can do just fine without.”

    I will leave it to others to refute other aspects of his plan, but this type of comment is exactly why we have the divide we have. There is an assumption that most grant dollars are unnecessary, as though there are a clear, objective definitions of “want” and “need.” There is no acknowledgement that such decisions are necessarily complex. Also, it speaks to Bob’s fundamental belief that government should have a different role than it is playing now.

    This is not an analysis based in facts and data. It is ideology pretending it is back by facts. You cannot start a conversation about a fair budget with this as a starting point.


  17. - east central - Wednesday, May 14, 14 @ 12:23 pm:

    Making the tax increase permanent now seemed like a good move for the Democrats because otherwise Rauner could campaign that a vote for him is a vote to prevent a tax increase. Better for it to be a done deal. Leaving the tax increase up in the air seems like it could cost Quinn the election, which in turn would put the Republicans in a much better position to concentrate on GA seats over the next eight years.

    I could see an extension that drops the rate 1/4 percent each year starting Jan 2015, with the permanent rate at 4% in 2018. This might keep the bond raters somewhat happy. If (When?) the pension changes are tossed, the GA could enhance revenue by for example broadening the tax base, saying the courts made them do it.


  18. - VanillaMan - Wednesday, May 14, 14 @ 12:54 pm:

    So here is the deal
    You let us keep the money or we make you move out of your house, because we decided you cannot live in your house anymore without you giving us more of your money.

    Welcome to Illinois!


  19. - Bill White - Wednesday, May 14, 14 @ 1:15 pm:

    Calling the budget first requires people to specify and vote on the expenditures they want deleted.

    Too many are willing to pander and say “We can find things to cut” without being willing to attach their names to any specific line item they want removed from the budget.

    Even Bruce Rauner said it was irresponsible to close certain facilities, when at those facilities.

    Therefore, Walker is spot on, IMHO

    ===

    “If this is what you want, this is what you have to pay for it.”

    or

    “If this is all you want to pay, this is what you have to lose.”

    ===


  20. - Precinct Captain - Wednesday, May 14, 14 @ 1:49 pm:

    ==The GA had a couple of years of 5% tax to get current on Bills and pare down deferrable and unnecessary spending, and they just used this period to increase spending and avoid real reform and making the hard decisions on the least painful budget cuts.==

    Another fact free diatribe and I saw scrolling down to the comment box you’ve got another. The “real reform” was actually paying the employer portion of pensions.

    http://capitolfax.com/2014/05/06/fun-with-numbers-34/


  21. - Yellow Dog Democrat - Wednesday, May 14, 14 @ 2:25 pm:

    @Westward:

    Yes, it occurred to someone besides you.

    Around this time of year, it becomes very folksy to say things like “Illinois needs to roll up its sleeves and balance its budget just like Illinois families do around the kitchen table every month.”

    The average U.S. household has $200,000 in debt.

    $150,000 or so in mortgage debt. Which really puts Quinn’s $500 check in political perspective.

    $15,000 in credit card debt on average, which works out to $72.5 billion in consumer debt for all Illinois households. Which really puts that $4 billion in unpaid bills in perspective.

    And another $30K or so in student loans. Which is okay if you are a salesman like Bruce Rauner, but not so good if you dedicated your life to serving as a public school teacher.

    How’d I do, Rich?


  22. - Demoralized - Wednesday, May 14, 14 @ 2:27 pm:

    I thought this was goofy but the more I think about it the more I agree with @Bill White. I think it’s good to vote on the budget before the tax vote. If this is the budget they want then fine. Now you have to pay for what you just voted for.


  23. - Yellow Dog Democrat - Wednesday, May 14, 14 @ 2:28 pm:

    To summarize: we have been balancing the state budget the way most families run their finances, and as polling shows they want state government run: increase services — or at least don’t reduce them — but don’t raise taxes.


  24. - A guy... - Wednesday, May 14, 14 @ 2:31 pm:

    Precinct Captain; you’re pretty angry all over the site today. It seems to me in this thread, it comes down to Democrats who are not supporting the continuation of the income tax increase. I guess you’re for this budget exercise or whatever mechanism comes along to make the tax permanent. I’m not certain why you think this crew would be better stewards in the future than they have in the past. Apparently this is only a courageous vote if the lack of an opponent offers you the courage to vote for it. I’ve seen very little, almost none really, of these folks being called out. It seems there’s a place for that outrage to be directed, why not aim there?


  25. - Yellow Dog Democrat - Wednesday, May 14, 14 @ 2:36 pm:

    @Demoralized:

    Do not count on lawmakers to come to conclusions on their own. Better hope that all of the organizations that perceive drastic reductions in services if there is no tax increase can get deliver that message effectively.


  26. - Anon - Wednesday, May 14, 14 @ 3:14 pm:

    I wonder how many profiles in courage will vote against both budgets and the tax extension? Why is it so difficult for non-targets to say what they are for and against?


  27. - CapnCrunch - Wednesday, May 14, 14 @ 3:33 pm:

    “The average U.S. household has $200,000 in debt”

    Got any idea of how much of this debt was incurred without the borrower knowing the level of household income?


  28. - A guy... - Wednesday, May 14, 14 @ 3:47 pm:

    ===CapnCrunch - Wednesday, May 14, 14 @ 3:33 pm:

    “The average U.S. household has $200,000 in debt”

    Got any idea of how much of this debt was incurred without the borrower knowing the level of household income?===

    And YDD states 75% of the debt is mortgage- in most cases an equity earning asset. I understand the math exercise and comparison, but few families I know of are as careless and cavalier about their spending habits as the state. The ones that are usually find themselves in court….hmmm, another coincidence. lol


  29. - Yellow Dog Democrat - Wednesday, May 14, 14 @ 3:58 pm:

    @A guy -

    You’re kidding, right?

    The average American household has $15K in credit card debt, about 25% of the average household income, but you don’t know any of them?

    Do you know anyone in Plainfield or Kennilworth, because last time I checked those relatively well-educated communities were leading the state in foreclosure rates.

    Again, look at the last ten years or more of public policy polls. Voters have overwhelmingly opposed cuts in spending. At the same time, a slight majority or plurality have opposed raising revenue. It is how we got here.

    When Illinois saw a windfall in our state budget in 1999, did we use it to pay down our pension obligations.

    No sir.

    George Ryan, with the Tribune cheering him on, dedicated 51% of all new revenue to an increase in education funding and he launched a $30 billion borrowing program for capital projects.

    No one. Criticized. Him.


  30. - Soccertease - Wednesday, May 14, 14 @ 8:02 pm:

    Just got around to reading this thread. I can’t believe the insanity! You cannot budget if you have no idea what your revenue stream will be. Why not do it right for a change and vote on the tax extension, then vote on the budget bill accordingly?


  31. - Quinn T. Sential - Wednesday, May 14, 14 @ 8:45 pm:

    [Let’s hope they don’t leave town with a completely phony baloney budget.]

    Are you kidding? That’s what happens every year.


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