*** UPDATE *** I missed this one…

[Illinois State Superintendent of Schools Christopher Koch] once again told lawmakers that schools across Illinois will be looking at $500 less per-student next year in general state aid. Koch reiterated that the 13,000 layoffs he talked about last week is the best-case scenario. He said if lawmakers ordered cuts for the last three months of this school year, or Gov. Pat Quinn followed through with a billion-and-a half dollars in cuts to education, the number of layoffs could triple.

But the newest warning from Illinois’ school chief is that he cannot tell local schools when, or if, they’ll get money for the mandated categorical of special ed and transportation, or for early childhood education programs.

[ *** End of Update *** ]

* Not encouraging news from the Senate Democrats…

“I’d not be comfortable saying [the governor’s proposed budget is] dead on arrival. But if I was simply assessing how I thought it would fare in the Senate, we’d have to assume we’d have to get Republicans on board to the idea of borrowing . . . and I do not see that happening,” said Rikeesha Phelon, a spokeswoman for Senate President John Cullerton (D-Chicago).

Borrowing beyond a fiscal year requires a three-fifths majority, and that means Republican involvement. It’ll be tough, for sure.

More on the borrowing and the deferral…

Even if lawmakers go along with Quinn’s cuts, the state still would be $11 billion short next year, Quinn budget officials said.

That’s where the options of a tax increase or borrowing come in.

Quinn aides said the administration will propose borrowing $4.7 billion and carrying over $6.3 billion of the state’s debt.

“Carrying over” means “not paying bills anywhere near on time.” That’s the biggest component of the Quinn plan, but it got the least media attention today.

* The GOP leaders speak…

Senate Minority Leader Christine Radogno (R-Lemont) and House Minority Leader Tom Cross (R-Oswego) issued a joint statement urging ruling Democrats to cut spending and rein in Medicaid expenses and state pension costs before asking taxpayers “to invest more of their hard-earned money into a state government that has not and is not serving them well.”

There aren’t nearly enough Medicaid and pension cuts in this proposed budget to satisfy the GOP. Then again, I kinda doubt that satisfying them is possible at this stage of the game. Going in relatively low leaves room for negotiations.

More on pensions…

Stermer also said there was “an agreement in the works” within the legislature that would institute a two-tier pension plan with lesser benefits for future state workers. Such a plan, he said, would provide up to $300 million in savings in the budget proposal. While pushed by prominent politicians in both parties, a two-tier system has been fought by state labor unions.

* As I told subscribers this morning, Murphy proposed borrowing as a solution when he was a gubernatorial candidate, so this is more than a bit disingenuous…

“They want to borrow their way past the election so they can pass the tax increase without risk of retribution from the voters, and that’s what this is set up to do,” said Sen. Matt Murphy (R-Palatine).

* If you watched the briefing videos, you know that the governor’s people had to be pushed and prodded over and over to come clean on just what some of this stuff meant. One of the big questions was about the missing tax hike component…

“The General Assembly has not acted on a tax increase and has given symbols that they don’t want to act on a tax increase,” said Jerry Stermer, Quinn’s chief staff. […]

As to whether Quinn would propose a specific revenue increase in his budget address, or divulge what he plans to do with the money that would come from one, no one in the room would answer that question.

“Quinn’s not included a tax increase in this budget, and that’s a conversation that has to happen,” Stermer said. When pressed on the issue, Stermer said, “The governor will talk about that tomorrow — noon sharp.”

* Here’s the skinny on the K-12 cuts…

About $1.2 billion in cuts will come from aid to local grade and high schools — a reduction of 17%

House GOP Leader Tom Cross is at least partially right…

“I don’t think he intends to cut a billion dollars out of education… He’s doing it to get the education community upset and to call lawmakers and say, ‘Vote for a tax increase so we don’t have this cut.’”

There have to be cuts, but education’s share is disproportionate to its budget size. The Sun-Times also rails against the education cuts today…

But we think his education cuts are too severe. We prefer a plan by the conservative-leaning Civic Federation to exempt from cuts Medicaid and a significant portion of the state public school budget, known as general state aid. The Civic Federation recommends across-the-board 7 percent cuts to bring Illinois back to 2007 spending levels, given how revenues have been whacked by the recession. Quinn also will propose a two-tier pension system today, with less generous benefits for new hires. This is both the right thing to do and a good way to bring around recalcitrant Republicans who refuse to support an income tax increase without pension reforms and budget cuts.

As I said earlier, I’m not sure those pension reforms are quite enough yet. The Republicans don’t really want to get in front of this issue because they also fear upsetting the unions. They’ve been content to hang back and demand the Democrats take the lead, which is what the minority party does. So, we’ll just have to wait and see what the actual agreement looks like, if they ever get one.

* The very conservative, anti-tax Daily Herald appears to be coming around on tax hikes…

Solving this crisis surely must involve a creative mixture of revenue increases and spending cuts from which no person or group can be exempted.

* And Jim Edgar gets the last word…

“Anything meaningful is gonna be very politically unpopular. You’re gonna be cutting programs, eventually you got to look at a tax increase, I just don’t think that’s gonna happen during an election year. What worries me is I’m not sure that’s gonna happen after the election. I’ve become very pessimistic.”

Edgar says his biggest hope is that politicians don’t make the state’s budget mess worse during the upcoming legislative session.

* Related…

* Quinn budget to mean painful choices for Ill.

* Governor’s budget plan calls for painful choices

* Quinn budget: Borrow more, cut more

* No tax hike? Then it’s loans under Quinn’s budget

* Quinn will propose budget with over a billion in cuts

* Quinn to Unveil Budget With No Tax Hike

* State Capitol Q&A: Quinn’s budget speech

* Municipalities Losing Revenue in FY 2011 Budget

* Illinois mayors upset with Governor Quinn

* Daley Reiterates Support for Quinn, Disdain for Budget Proposal