* The AP explains the deficit…

A deficit of $11.5 billion would amount to $917 for every man, woman and child in the state. That’s roughly the same amount that Illinois schools get from the state.

If officials wanted to tax their way out of the hole, they would have to double the income tax. If they wanted to cut spending, eliminating the Transportation Department, the Environmental Protection Agency and the child-welfare department would just about do it.

Like families trying to pay bills and save for college, state government has seen its costs climb steadily. Medicaid costs ballooned as health care grew more expensive and more people turned to the state for care. Employee salary and health costs rose, and the law required bigger and bigger contributions to retirement funds. In addition, officials approved new programs, such as the health care expansions championed by former Gov. Rod Blagojevich.

At the same time, the state gets most of its money from taxing income and sales. That means less money is available in a recession, when incomes drop and people cut back on shopping.

And has an anti-taxer suggest a solution…

John Tillman, chairman of the Illinois Policy Institute, argues there is no reason the entire deficit must be erased at once. What can’t be handled through spending cuts can be rolled over to future years until the economy improves, he said.

That was done before (by Jim Edgar, especially) and will undoubtedly be done again. But you can’t do that with the entire $11.5 billion. It’s just too much. California is a case in point…

Some hints of what may be coming, for other states as well as Illinois, lie in the experience of California. California, like Illinois once a bellwether state, but now solidly in the Democratic camp, thumped residents solidly with taxes. Sales tax up. Income tax up, too. Vehicle license fees doubled. Child care deductions cut.

On the other side of the equasion, California cut $15 billion in costs, more than half coming from education. The state cut two holidays and forced employees into one unpaid day a month.

As serious as all that sounds, it wasn’t enough. It made up only two-thirds of the hole — or about as much as the voters could choke down.

The other one-third of California’s budget hole was patched with borrowing.

What about rolling back Rod Blagojevich’s Medicaid expansions, including All Kids? Progress Illinois takes a whack at that…

The former governor’s FamilyCare expansion may have been reckless from a constitutional standpoint, but there’s no evidence that it’s weighing down the budget significantly. Only about 4,000 additional families managed to enroll under the expanded guidelines, which translates to less than $20 million per year.

* And how big of a bite will the tax hike take? The Trib explains…

…families of four earning about $56,000 a year or less would get an income tax cut or at least pay no tax increase because of the higher personal exemption he also was proposing. […]

Quinn is considering raising the state’s personal income tax rate, to 4.5 percent from 3 percent. Quinn aides have said the standard exemption may rise from $2,000 to as much as $6,000. Such a plan would mean families of four with a $75,000 income would pay $285 more in taxes and a family earning $100,000 would pay an extra $660 to the state, based on gross income and absent any other credits or deductions.

* The Tribune editorial board takes the populist route…

Many are the reasons why the State of Illinois’ accumulating deficits could total some $11 billion by the summer of 2010. But taxpayers shouldn’t feel guilty. For two decades, they’ve been increasing their payments to Springfield at roughly double the rate of inflation.

Perhaps, but if you look at taxes collected since 2002 and factor in the revenue crash currently predicted by the governor, it’s almost flat. So, the Trib is being disengenuous. Also, the income tax has not been raised in 20 years. And then there’s this…

Illinois’ total state and local tax and fee burden as a percentage of personal income is among the lowest of all states, according to 2006 data collected by the Federation of Tax Administrators and distributed by CTBA

And this…

Illinois now has one of the country’s more regressive tax systems. It’s time to shift the burden to those who can pay more. Quinn looks headed in that direction, saying Friday his plan includes a tax cut for lower income workers.

But without giving the governor an opportunity to explain any of his proposed budget cuts, the Trib lays into him…

We expected his teaser remarks in advance of his budget address this Wednesday to be odes to economizing: calls for higher benefit contributions from employees, moving Medicaid patients to managed care and other bold tactics for modernizing practices that are grounded in two prior centuries.

But then, with our optimism stoked and our pompoms at the ready, we heard about … the prisons, the teachers and the tax hike

What the Trib fails to understand is that, most likely, the governor is trying to assuage the interest groups before he lowers the boom on the cuts…

Quinn will try to cut $850 million from programs financed through the state’s general fund, the all-purpose checking account that pays for most state services. How Quinn will do that was not answered

$850 million may not seem like a lot in comparison to an $11.5 billion deficit, and it isn’t. But, as we’ve found here and as explained above, unless you want to cut aid to schools or throw people off Medicaid, there’s not a whole lot you can do.

* Good point…

Adding to the political intrigue is how helpful [House Speaker Michael Madigan] will be in ushering the tax hike through the legislature. The increase undoubtedly could be used by Madigan’s daughter, Atty. Gen. Lisa Madigan, against Quinn should the two face off next year in the Democratic primary for governor.

* Meanwhile, I told subscribers about this plan last week…

You may pay more for license plates as a way to improve state roads and bridges.

Exactly what’s under consideration will be revealed Wednesday when Gov. Pat Quinn unveils his budget proposal for the fiscal year that begins July 1.

On Friday, chief of staff Jerry Stermer acknowledged the state was considering fees to bring in more money. […]

Illinois charges a set $78 fee annually for license plate registration renewal. The fee was increased by $30 in 1999 to help pay for a statewide construction plan. The Illinois Secretary of State’s office said increasing the $78 fee by $10 would produce $90 million in additional revenue.

* Related…

* CTBA: To Counter the Current Recession, Illinois State Government Should Maintain or Enhance Spending—Even if it Means Progressive Tax Increases—Rather Than Cut its Budget

* Mike Lawrence: Put the governor in charge of education

* Quinn faces $11.5 billion budget question

* To fix fiscal crisis, Quinn must go for broke

* Quinn tax hike: Gov. Pat Quinn to detail tax increase

* Deficit, recession challenge Gov. Quinn

* Budget deficit, recession challenge gov

* Gauging political price of tax plan

* Syverson: Budget cuts should come first

* Most local lawmakers say raising state taxes is not an option

* Suburban lawmakers talk taxes, sacred cows

* Sen. Dick Durbin: Gov. Pat Quinn ‘has no choice’ but to raise state income tax: Quinn has ‘no choice,’ he says; Daley not ready to approve or condemn

* Sen. Dick Durbin: Gov. Pat Quinn ‘has no choice’ but to raise state income tax

* Illinois budget: Plenty of problems, few solutions

* What’s the tax plan?

* Quinn parades $26 bil. state construction plan

* PJStar: Road program’s only problem is paying for it