* The Civic Federation carefully analyzes state budget proposals every year. So, while you may think this is a bit late to the game, it’s actually about right on time, considering the ongoing budget talks in the Senate…
The Civic Federation on Tuesday blasted Gov. Bruce Rauner’s recommended budget in a report that say it relies on “uncertain savings, one-time revenues” and the passage of the always in flux Illinois Senate “grand bargain” plan — while also blaming lawmakers for a “spectacular failure” for not enacting a budget.
The Civic Federation’s Institute for Illinois’ Fiscal Sustainability on Tuesday said it can’t support Rauner’s budget because it has an operating deficit of $4.6 billion and doesn’t address the state’s backlog of bills. The group also cites concern over the reduction of pension contributions by $1.25 billion and the reduction of group insurance payments and nursing home placements caused by a new at-home care program for seniors not eligible for Medicaid.
The group also warns that “one-time resources” from the sale of the James R. Thompson Center may do nothing for next year’s budget and shouldn’t be used to help balance the budget. The governor last week said he hoped the sale would provide “long-term” help for the state — saying he supports Republican-sponsored measured to send property tax revenue from the site to Chicago Public Schools.
Rauner in February presented his proposal that presses for revenue, reforms and cuts to fill a gaping hole. But it was deemed “balanced” by the state’s budget director because it was reliant on the Senate plan passing. Within the budget proposal is a mixture of spending cuts, revenue and projected economic growth to try to reach a magic number of nearly $4.6 billion. The administration said in February it was seeking to fill the remaining $2.7 billion plus by getting legislative authority to make cuts. In terms of the state’s massive debt, state budget director Scott Harry said “the governor would be open to financing” to get the backlog down.
Declaring that budget to be balanced when it obviously was not was one of the biggest tactical mistakes the governor’s office made this year.
* With emphasis added, here is the Civic Federation’s press release…
For nearly two years, Illinois has operated without a comprehensive budget, during which time the State’s credit rating has fallen to near-junk status and unpaid bills have continued to climb. Judicial mandates, full-year appropriations for elementary and secondary education and the questionable payment of State employees without appropriations have removed pressure on lawmakers to compromise on a full spending plan.
“Operating Illinois on autopilot is not a solution, nor is it sustainable. Rather, it represents an abdication of the most basic constitutional responsibilities of proposing and passing a balanced budget,” said Civic Federation President Laurence Msall. “The Governor and General Assembly need to end this unacceptable stalemate by passing and enacting a comprehensive plan. Cherry-picking certain areas of government to fund while pledging to work toward a complete budget sometime in the abstract future has not and will not end the crisis and in fact is making it worse.”
Unfortunately, Governor Bruce Rauner’s recommended budget for FY2018 does not offer a sufficiently detailed plan to address the State’s immense financial problems. To close the deficit of $4.6 billion, it relies on uncertain savings, one-time revenues and a bipartisan agreement in the Illinois Senate, the provisions of which are in flux and likelihood of passage is unclear.
Further, the Federation cannot support a budget proposal that would allow the backlog of unpaid bills to increase to $19.7 billion if the gap is not closed. Because of the backlog, the State begins each fiscal year in a hole, using revenues from the current year to pay off the previous year’s obligations. A $19.7 billion backlog at the end of FY2018 would represent more than half (58.1%) of estimated FY2019 General Funds revenues.
The Civic Federation continues to recommend a comprehensive plan including spending restraints and increased revenues. Spending controls are at the center of the Federation’s plan, but significantly more revenue is needed to help reduce the deficit in FY2017 and close the gap in FY2018 without drastically changing the scope of State government.
The full report can be read by clicking here.
…Adding… Greg Hinz…
In fact, [Msall] continued, the situation has gotten so bad that the state now has to spend the first six months’ worth of revenues paying off bills that accumulated in the prior year.
Let that sink in a bit.
*** UPDATE *** From the Pritzker campaign…
“Illinois needs a leader who can bring people together to put an end to this budget crisis,” said JB Pritzker. “While Bruce Rauner has decided to hold the state hostage for his teardown agenda, millions are suffering the consequences and future generations will inherit the mess he’s created. As governor, I will propose a balanced budget to protect middle class families and get Illinois back on track.”