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“It’s not even close to being balanced”

Thursday, Jul 28, 2016

* Illinois Issues has a new story on the stopgap budget. Most of it has already been covered here, but this is new

“It’s not even close to being balanced,” says Richard Dye, co-director of the Fiscal Futures Project at the University of Illinois Institute of Government and Public Affairs. “What was passed was with either optimism or ignorance of what revenues were actually flowing in. So it’s not clear that everything that was approved in the stopgap budget can be funded because the cash flow through the state through the comptroller’s office is just not sufficient.” […]

“I come at this somewhat pessimistically. … It’s hard to be optimistic. Even if there were new revenue sources, are they sufficient to pay down the backlog? Are they sufficient to catch up … the extent to which different agencies have not been funded for a year and a half?”

Dye says he expects that if a budget deal is reached after November, it will rely on accounting gimmicks and push some costs into future years because trying to completely tackle the deficit would be virtually politically impossible. “We really are in a position where things have gotten so bad that we can’t have expectations of taxing and spending levels kind of what they were like in recent years. Things have to change in terms of the nature of government and what people expect to have to pay or expect to get. “

- Posted by Rich Miller        

43 Comments
  1. - @MisterJayEm - Thursday, Jul 28, 16 @ 9:50 am:

    “What was passed was with either optimism or ignorance of what revenues were actually flowing in.”

    To be fair, it could have been passed with optimism AND ignorance…

    – MrJM


  2. - Waffle Fries - Thursday, Jul 28, 16 @ 9:51 am:

    Much of the appropriations (all of it, I think) for human services came from a fund that has a cash balance - meaning checks can be written as soon as bills land on the comptroller’s desk. THere was over $400 million in that fund when the stopgap passed - it’s expected to generate over $200 million more by the end of the calendar year.

    Cashflow shouldn’t be a big issue for those types of bills.

    However, the theme of the story is correct, not a balanced budget, not even close.


  3. - Joe M - Thursday, Jul 28, 16 @ 10:03 am:

    But my state representative keeps sending me flyers saying that the stopgap budget solved Illinois’ problems and the state universities’ problems, and also saved us from Democrat’s tax increases.


  4. - CharlieKratos - Thursday, Jul 28, 16 @ 10:08 am:

    The beast, it is squeezed. /s


  5. - Ghost - Thursday, Jul 28, 16 @ 10:11 am:

    no problem, Goc just needs to anounce where he is going to approve soending based on his revenue stream. Budget is just permission to spend. spending choice is all the govs.


  6. - Norseman - Thursday, Jul 28, 16 @ 10:13 am:

    What’s sickening thing is that short of a wholesale decimation of a party’s caucus the problems will continue to grow as Rauner continues his hostage strategy.


  7. - illini97 - Thursday, Jul 28, 16 @ 10:23 am:

    Joe M -

    Not only does my rep say he saved me from Democratic tax increases, he also voted for a stopgap. Gee, what a low bar he has set as a legislator.

    Worse yet, he claims that he stopped that evil bailout of Chicago schools. Funny, I thought CPS was getting help as part of the stopgap deal.

    Maybe the Illinois Republican Party (who paid for the mailer) need to clarify what is and what is not a “bailout,” because I thought it was previously claimed that any deal that gave CPS one extra cent was a bailout. Pick a lane, guys.


  8. - Last Bull Moose - Thursday, Jul 28, 16 @ 10:23 am:

    This has been known for months. The State does not have the cash flow to pay for legally required expenses.

    Instead of term limits, could we require all elected officials to pass basic accounting and finance courses from an accredited MBA program?


  9. - CCP Hostage - Thursday, Jul 28, 16 @ 10:28 am:

    The beast is still being squeezed–most human services providers still haven’t received any stopgap money, despite the availability of funds through the Fund for Human Services.


  10. - Demoralized - Thursday, Jul 28, 16 @ 10:54 am:

    ==despite the availability of funds==

    Those funds aren’t never ending. There isn’t enough money in that fund to cover what everyone is owed. I think the biggest problem with the stopgap budget was the everyone assumed they would be paid. That is far from the case. There may be some who still don’t get any payments. And that’s just sad. It was sort of a cruel joke to get hopes up when they knew that they wouldn’t be able to pay everyone everything they are owed.


  11. - NorthsideNoMore - Thursday, Jul 28, 16 @ 10:55 am:

    Some Spanish saying about bull fights “it is one thing to talk of balanced budgets (bull fighting) , It is another altogether different thing to balance budgets (get in the ring)”


  12. - Anonymous - Thursday, Jul 28, 16 @ 10:56 am:

    I dont see why we have a problem with Gov shake up Sfld. Where are his cuts to bal the budget, OR, his revenue enhancements if s/ necessary.


  13. - Harry - Thursday, Jul 28, 16 @ 11:12 am:

    Not really news, more like another credible source confirming what we knew.

    I don’t think they’ve passed an honest budget since before Blago, and given the nature of the pension ramp-up at the time, and the lack of any attempt at responsible pension funding before 1995, one could argue they haven’t passed an honest budget for well over a century. In Heaton, the Sup Ct cited a Pension Study report from 1916 and the pension funding problem was already decades old at that time.


  14. - Anon221 - Thursday, Jul 28, 16 @ 11:18 am:

    For service providers another question needs to be answered- how many vouchers/invoices are being purposely held up by the Agency heads??? The Comptroller can’t pay until submissions are made. The stopgap did not solve this squeezing tactic.


  15. - walker - Thursday, Jul 28, 16 @ 11:39 am:

    Everyone should have known this for 18 months now. It’s not “news.” Two budget proposals by Rauner, and two budget proposals by Madigan, and every significant stopgap spending bill, we’re not covered by expected revenues. The issue has remained that every party knows more taxes are required for their own budgets, and are unwilling to take the bulk of the heat for that reality.

    What’s news is the realization that this is substantially harder to fix now than it was 18 months ago. Any foreseeable required tax increase, even when it finally occurs, will not be enough to fullycover either sides’ gap. We wil be stuck again with balancing the budget with gimmicks and “borrowing.”


  16. - blue dog dem - Thursday, Jul 28, 16 @ 11:42 am:

    This is exactly why I say higher ed needs budget Cuts. Really? It took our esteemed state university Institute of Govt and Public Affairs to come to this determination? Can somebody help me out with how much this guy makes a year?


  17. - Federalist - Thursday, Jul 28, 16 @ 11:45 am:

    “Dye says he expects that if a budget deal is reached after November, it will rely on accounting gimmicks and push some costs into future years because trying to completely tackle the deficit would be virtually politically impossible.”

    Yep, that’s the “Illinois way” for many decades no matter party affiliation.


  18. - Ron - Thursday, Jul 28, 16 @ 12:01 pm:

    Spending simply needs to be cut. The state can’t afford to offer many things anymore. We have the third highest tax burden in the nation and are losing people faster than any state other than West Virginia.


  19. - Norseman - Thursday, Jul 28, 16 @ 12:11 pm:

    === Spending simply needs to be cut. The state can’t afford to offer many things anymore. We have the third highest tax burden in the nation and are losing people faster than any state other than West Virginia. ===

    “Simply?” We’re waiting for Rauner’s cut budget. Maybe you can advise him on how to put it together.


  20. - CCP Hostage - Thursday, Jul 28, 16 @ 12:54 pm:

    Of the companies about whom I have personal knowledge, one has had roughly $12,000 out of the $1.2 million they’re owed sent to the comptroller. The other, less than $100 out of the $300k they’re owed. It’s hard to believe that it is anything less than more beast squeezing.


  21. - Honeybear - Thursday, Jul 28, 16 @ 12:58 pm:

    Ron please move out now. Loving God move. Either that or volunteer for meals on wheels and explain to a homebound senior why they may start to get less meals or no meals at all.


  22. - Federalist - Thursday, Jul 28, 16 @ 2:04 pm:

    Real Question!

    I though Rauner had submitted a specific budget.

    Am I wrong?


  23. - 13th - Thursday, Jul 28, 16 @ 2:06 pm:

    Not only has human services not been paid, but the state cannot tell them what they will get for FY16 (which is over), nor what amount the stop gap will provide for FY17

    They just give a bunch of explanations that goes around in circles and blames the other government agency for delay of information


  24. - CCP Hostage - Thursday, Jul 28, 16 @ 2:29 pm:

    The agencies are using the OODA loop strategy when asked questions about when money will actually go out to providers.


  25. - Last Bull Moose - Thursday, Jul 28, 16 @ 2:30 pm:

    Federalist, I do not think that Rauner ever submitted a balanced budget with detail. He would have had to spell out the cuts required.


  26. - atsuishin - Thursday, Jul 28, 16 @ 2:30 pm:

    ==Things have to change in terms of the nature of government and what people expect to have to pay or expect to get.==

    This is 100 % true and those here calling for cuts are right. The state needs to shrink down its bloated workforce dramatically and cut back on services, only the truly needy are to be receiving taxpayer subsidy.


  27. - Anonymous - Thursday, Jul 28, 16 @ 2:50 pm:

    === Instead of term limits, could we require all elected officials to pass basic accounting and finance courses from an accredited MBA program? ===

    This is an extremely high standard. What about an elementary school math class?


  28. - forwhatitsworth - Thursday, Jul 28, 16 @ 2:51 pm:

    === Instead of term limits, could we require all elected officials to pass basic accounting and finance courses from an accredited MBA program? ===

    This is an extremely high standard. What about an elementary school math class?


  29. - atsuishin - Thursday, Jul 28, 16 @ 3:27 pm:

    ==What about an elementary school math class?==

    this is the root of the problem many of them
    “learned” elementary math from CPS.


  30. - Demoralized - Thursday, Jul 28, 16 @ 3:34 pm:

    ==cut back on services==

    Ok. Provide your list. And make sure you cut back on services enough ($10B or so) so that a tax increase isn’t necessary.

    We’ll wait for your list.


  31. - atsuishin - Thursday, Jul 28, 16 @ 3:43 pm:

    - Demoralized - Thursday, Jul 28, 16 @ 3:34 pm everything that is not constitutionally or federally mandated needs to be cut. Everything. If whole agencies need to be zeroed out so be it.


  32. - Demoralized - Thursday, Jul 28, 16 @ 3:53 pm:

    ==everything that is not constitutionally or federally mandated needs to be cut==

    I see. Make sure you go door to door telling the elderly why they can’t get Meals on Wheels anymore. I can come up with a whole list of things like that for you to do since you are just fine and dandy with cutting everything.

    I suspect you don’t have the first clue as to what you are actually cutting or (and perhaps worse) you simply don’t care who might be hurt by it.


  33. - Norseman - Thursday, Jul 28, 16 @ 3:55 pm:

    atsuishin, your list and nothing but your list.

    We keep hearing rhetoric from folks that we can cut our way out. Unsurprisingly for those of us who have a passing knowledge of state government, no one, absolutely NO ONE has put forward a credible list of cuts.


  34. - Demoralized - Thursday, Jul 28, 16 @ 3:56 pm:

    ==everything that is not constitutionally or federally mandated needs to be cut==

    And if you had the first clue you’d know that using your logic you still wouldn’t balance the budget without having to raise taxes.


  35. - Skeptic - Thursday, Jul 28, 16 @ 3:58 pm:

    [Reply deleted by the author to avoid feeding the trolls]


  36. - Steve Schnorf - Thursday, Jul 28, 16 @ 4:18 pm:

    Neither the budget working groups nor the legislative and GOMB staff were optimistic or ignorant. They were realistic about what needed to be done and what could be done


  37. - Illinois bob - Thursday, Jul 28, 16 @ 4:34 pm:

    @honeybear

    =Ron please move out now. Loving God move. Either that or volunteer for meals on wheels and explain to a homebound senior why they may start to get less meals or no meals at all=

    He’s got as much right to be here as you, bear. If there’s a more union friendly environment in which you’d rather live, feel free to pack.

    Regarding seniors, fairness often dictates benefits rather than need.

    Senior real estate tax breaks, even for millionaires, are given and the tax burden is shifted to everyone else, many of whom can afford it less than the seniors. PTELL allows real estate tax increases on the total levy regardless of how many are given senior breaks. IMHO, that’s simply unfair.

    When my Dad passed a few years ago, he was fighting tooth and nail to keep the PACE door to door pickup for a flat $2 fee. The town had to stop it because they were having to lay off police and EMTs because dollars were so tight. The actual cost of the senior service was about $50 per ride. We lived close enough that we could take him anywhere he wanted to go, but he wanted the “free” service from the town instead. That wasn’t fair either.

    I know it’s anecdotal, but it illustrates some of the abuses that are out there that fairness would dictate be cut.

    Determining “fairness” in most cases isn’t that hard. The politics of implementing fairness IS…


  38. - Cassandra - Thursday, Jul 28, 16 @ 4:47 pm:

    This certainly goes along with what I’ve been wondering. There is a long list of areas of government which are in need, we are told, of not just ongoing, but additional funding-universities, k-12, social services, the state bureaucracy (when union negotiations are concluded), and others I haven’t thought of. This in addition to the fy 16 backlog. And I hope we’ve learned the pension debt has to be paid-no skipping.

    Is it realistic to think a massive tax increase to take care of this is even politically possible?
    The Democrats may be ready to get behind one right after the election, but that’s when the guv presumably will be charging up his campaign for a second term. As the 2018 election approaches, neither party will want to talk tax increase. They’ll remember Pat Quinn. And Ogilvie.

    Accounting tricks-the smoke and mirrors approach- may be the only practical approach, from a political standpoint. Maybe with a modest, temporary bipartisan tax increase…maybe not. But I sure wouldn’t expect rivers of new revenue.


  39. - RNUG - Thursday, Jul 28, 16 @ 5:29 pm:

    == Is it realistic to think a massive tax increase to take care of this is even politically possible? ==

    Before the GA allowed the 5% income tax rate to expire and Rauner dug the hole a lot deeper by causing the courts to mandate all the spending, Illinois was slowly digging out of the hole.

    The State can raise the needed revenue … and at some point Rauner and the GA will be forced to raise taxes.


  40. - Ron - Thursday, Jul 28, 16 @ 5:39 pm:

    That senior will get no meal beacuse we have outrageous pensions to pay.


  41. - Ron - Thursday, Jul 28, 16 @ 5:43 pm:

    Layoff state workers. Cut budgets across the board. Off course people will be hurt. They can call Madigan and Edgar.


  42. - cassandra - Thursday, Jul 28, 16 @ 5:59 pm:

    In addition to property tax breaks and reduced fare movie and museum tickets, seniors also get no state taxes on their retirement income. That includes required minimum distributions from even the plumpest defined contribution accounts.

    Let me bring up again that our next US President will be….a senior. Hillary will be well into her seventies when she leaves office. Or, Trump,
    even futher. All seniors are not decrepit, just as all children are not poor.

    Time to apply a more reasonable standard to our welfare programs for seniors. A growing group I might add.


  43. - Chicago Barb - Thursday, Jul 28, 16 @ 6:06 pm:

    Ron, Illinois’ head count is one of the lowest. And although our property tax is high, our income tax is one of the lowest. We have not sufficiently funded K-12 or higher education for years. Social services are expendable until you need them. Madigan will not pass a tax increase unless some Repbulicans vote for it. Rauner will not name specific budget cuts because then he gets the blame. So we are in a Mexican standoff.


Sorry, comments for this post are now closed.


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