* I told you about this problem last month. And now, CoGFA is saying the same thing…
It would take a no-growth spending plan over the next three years to put the budget into the black, according to a new report from the bipartisan Commission on Government Forecasting and Accountability. Keeping a balanced budget when the tax hike expires will be a struggle, especially because Illinois continues to lug billions of dollars in overdue bills.
And, as I told you before, the Democratic leaders and the House GOP Leader are not proposing enough cuts to ensure that the tax hike goes away…
Allied with Democrat Madigan is Rep. Tom Cross, the House Republican leader. The Madigan-Cross spending plan is $33.2 billion out of the state’s main checking account. That’s about $1 billion less than what the Cullerton-led Senate Democrats want to spend and about $2.2 billion less than Quinn’s version.
At this point, the House plan would come closest to the first-year level the state’s budget forecasting commission says is needed to right the financial ship and eventually allow some of the tax hike to go away.
But Cross says there are no worries…
Cross is more confident. “There’s a path there to not continue the tax increase,” he said. “We feel pretty good about that.”
There are worries. Plenty of them. For instance, the Civic Federation’s new report…
Quinn’s budget overestimates revenues by $976 million because it doesn’t set aside enough money for income tax refunds, Msall said. That makes the total budget shortfall $2.4 billion — far more than the $1.45 billion caused by the governor’s added spending alone.
So, the House’s cuts may not be quite enough to even balance next fiscal year’s budget.
* Meanwhile, legislators are now seriously looking at cutting funding to local governments…
About $2.5 billion in outlays aren’t part of the budgets that are being considered by the various General Assembly appropriations committees. The biggest part of that is money the state sends to local governments to prop up their finances.
Gov. Pat Quinn has proposed suspending that revenue-sharing unless lawmakers approve a borrowing plan to pay off old bills. Sen. Donne Trotter, D-Chicago, a Senate budget expert, said the idea of cutting revenue-sharing would be on the negotiating table regardless of the borrowing plan.
“We could take it all, take a percentage, suspend it for a year,” Trotter said of the options open to lawmakers.
* At least one legislator, Rep. Sara Feigenholtz, has come up with an idea to get more money for the budget…
Feigenholtz’s measure, an amendment to House Bill 2934, would authorize short-term borrowing $900 million from existing state funds for the purpose of paying down Medicaid health care bills in order to snag extra federal money.
The House voted, 118-0, to approve the bill and send it the Senate for consideration.
Currently, the federal match for Medicaid is 57%. After June 30, the match will drop to 50%. By paying Medicaid bills early, Feigenholtz estimates that the state could save $90 million.
The Illinois Department of Healthcare and Family Services alone will have $1.3 billion in Medicaid bills on hand at the end of the state’s fiscal year on June 30, 2011. Currently, there is insufficient money to pay the bills. By utilizing $400,000,000 from the Water Revolving Fund and $500,000,000 from the General Obligation Bond Retirement and Interest Fund or other state funds from June 25 to July 30,the state could reduce its Medicaid bill by $90 million.
The state funds would be repaid by August 31, 2011.
* But individual Democrats are still balking at the cuts…
Last week, state Sen. William Delgado complained that his colleagues on the Democratic side of the aisle in the Senate were trying to sneak through a series of budget cuts to a variety of social service programs.
“I thought this would be a more open process,” he griped. “I wasn’t part of this.”
Turns out, the Senate Democrats did outline the proposed cuts during two meetings — one in a closed-door session in Springfield and the other via a conference call. […]
Senate President John Cullerton, D-Chicago, had hoped to get the budget ball rolling in his chamber last Tuesday with an eye on finishing things up for the spring by the end of the month.
By the end of last week, however, the ball was no longer moving and lawmakers began to murmur about blowing their targeted May 31 adjournment date, forcing them to spend the summer in Springfield.
* Sen. Donne Trotter gets the quote of the week…
“This is what the rank and file asked for,” Trotter said of budgets being drafted by committees rather than a handful of lawmakers. “They asked to come into the kitchen. They’re finding out it’s hot in the kitchen.”
* And Gov. Quinn is still mostly irrelevant…
Gov. Pat Quinn notched a rare legislative victory last week, when his last-minute veto threat apparently played a role in the defeat of a proposal to allow people to carry concealed handguns in Illinois. Otherwise, however, observers say Quinn hasn’t been closely involved with General Assembly deliberations this spring – even on proposals Quinn himself initiated.
When Quinn gave his budget address in February, he called for saving money by reducing the number of school districts from 868 to 500, eliminating regional school superintendents, getting rid of legislative scholarships and borrowing billions of dollars to refinance the debt the state owes to local governments, schools and vendors.
As the General Assembly enters the final three weeks of its regular session, none of those ideas have gained much traction. Meanwhile, both legislative chambers seem intent on slashing Quinn’s budget proposal by $1 billion or more.
“I don’t think there has even been any request for bills,” said Steve Brown, a spokesman for House Speaker Michael Madigan, D-Chicago, about Quinn’s proposals to consolidate schools and eliminate the state’s regional school superintendents. When he made the budget speech, Quinn estimated school consolidation would save $100 million, while axing the regional superintendents would save $13 million.
* And even the Peoria newspaper is noticing that the Senate Republicans have taken themselves out of the game…
On that score, while we cheered Senate Republicans a month ago for coming up with a series of proposed cuts, it is fair to note that they have yet to introduce any of them as bills. Over on the House side, the GOP is actually working with Democrats to craft a budget. If their Senate colleagues aren’t up to doing the latter, could they at least try the former to get more deeply involved in the process?
The bottom line is that everybody in Springfield must get serious about passing a responsible budget that might hurt more than Illinoisans would like, but is vital to setting the state on a course toward solvency. Anything short of that means a future meltdown for everybody. Lawmakers who can’t accept that and who aren’t willing to say no when necessary ought to rethink why they’re in the Legislature.
* Apparently uttered without irony…
“[Gov. Quinn] should be looking to try to shape the product as it’s being formed in the legislature so we don’t have an issue of him getting a budget that passed the General Assembly that he’s decided to veto,” [Senate Republican Matt Murphy] said.
* Related…
* Speaker, Cross work on budget together
* Budget work getting messy
* The hidden (federal) costs of Illinois budget cuts: Here’s how it works. Illinois receives over $35 million in ongoing annual federal funding for rental subsidies and other operating costs, and about $7 million in Medicaid reimbursements through supportive housing programs. Those funds come on the condition that Illinois matches 25% (ie, for every dollar Illinois puts in, the Federal Government puts in four). That means any dollar cut at the state level actually costs supportive housing five dollars in the end. This problem hits Continuum of Care and Neighborhood Stabilization Programs especially hard, threatening their ability to provide homeless services and neighborhood development efforts in every county in the state.
* Illinois House takes budget behind closed doors
* Protest at Normal nursing home decries proposed Medicaid cuts
* Cuts could take another stab at the elderly
* It shouldn’t be easy to sweeten state pensions
* School districts not phased by union protests to education reform
* Legislature targeting for-profit universities for grant cuts in state budget
* House committee backs plan for funding higher ed, but changes may be ahead
* Continental Tire gets tax break from Illinois to hire more workers
* Quinn threatens to withhold funds from local governments - Evanston officials outraged, issues advocate action alert
* State workers would have more choices if Health Alliance is dropped, independent physicians group says
* Word on the Street: Health insurance ‘timing‘ questioned
* A do-over needed on state insurance
* Christie Clinic can’t take all those whose insurance would change
* Bernard Schoenburg: IDOT not content to drop firings fight
