Democratic House Speaker Michael Madigan introduced his long-awaited spending plan Tuesday, but didn’t offer specifics on how to pay for the $36.4 billion proposal that would direct money to schools, universities and social service programs.
That prompted Republicans backed by Gov. Bruce Rauner to accuse Democrats of refusing to “show their cards” on a tax increase, saying without details it’s impossible to tell if Madigan’s blueprint was balanced.
With a Friday deadline looming to strike an agreement before Illinois government enters a third-straight year without a budget, both political parties appear to be locked in a high-stakes game of chicken.
Rauner, his Republican allies in the legislature and the Democrats who control it agree that an income tax hike from 3.75 percent to 4.95 percent is a starting point to dig the state out of a multibillion-dollar hole. In the House, neither party wants to blink first and face the blame from voters who don’t want to fork over more of their money.
“I have said from the beginning … a revenue bill will be a joint effort,” Madigan said Tuesday.
That’s a pretty good take, except that Gov. Rauner and the Republicans haven’t introduced their own tax hike bill, either.
* Mark Maxwell at WCIA…
House Speaker Michael Madigan (D-Chicago) and Republican Minority Leader Jim Durkin (R-Western Springs) both agree the state should raise the flat income tax to nearly five percent and the corporate rate up to seven percent, but neither has presented their tax plan in bill form.
Durkin says that’s Madigan’s job.
“I don’t run the chamber,” Durkin says. “I am not running this process. I am not included in participating in the budget which we will see in the next two days. [House Democrats] control it, so they will own the introduction of the tax bill — the Democrat tax legislation.”
After you, sir. No, after you, sir. No, by all means, after you, sir. No, I must insist, after you, sir.
There’s still no concrete plan to pay back the bill backlog, as well. The state is currently paying 12 percent interest on those bills. With refinancing, the state can get that down to 4.5 or 5 percent, but they would need new revenue. In budget talks, Senate Democrats contemplated bumping the income tax to 5.25 percent to pay down the backlog, but other ideas are being discussed as well.
Rep. Greg Harris, D-Chicago, said on Tuesday that House Democrats “would be open to discussion of different revenue sources.”
“In talking to folks who are familiar with the bond market, you do need a dedicated revenue source to get the lowest possible rate,” said Harris, adding that Democrats want to pass a budget plan first, then tackle the revenue bill.
A 5.25 percent income tax rate, even if part of that rate is only in place for a few years for a specific purpose, would be a non-starter for a governor who repeatedly promised during the campaign to lower the rate to 3 percent by the end of his first term.