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Where does the budget come up short?

Wednesday, Jul 5, 2017

* Tribune

In his Tuesday veto message, Rauner asserted that the budget package was $2 billion out of balance. His office says the legislation counts $500 million in savings on pension costs that aren’t guaranteed and fails to account for $1.5 billion in spending from the budget year that ended Saturday. That money would have to be paid out of the current budget year funds, Rauner’s team contends.

I went over the governor’s veto in detail with subscribers today, but since this is in the public domain, let’s look at it.

* If you click here, you’ll see that the Republicans’ “Capitol Compromise” plan (labeled “Brady June” in the document) booked $1.25 billion in pension savings. As we’ve discussed many times before, the governor’s first budget proposal booked a whopping $2.2 billion in immediate pension savings.

So, spare me the outrage.

* Now, on to the second point. The governor spent a ton of money without any appropriations. He signed contracts for goods and services knowing that there was no legally authorized cash to pay for them. And, now, after spending that unauthorized money, he wants the General Assembly to pay off his bills.

Despite my snark, the state does need to pay those bills. But if the governor wants that revenue, he needs to go negotiate with the leaders to generate it, or make cuts on his own. And that would’ve been much easier to do if he had used his line-item and reduction veto powers instead of vetoing the whole budget in one fell swoop.

* Meanwhile, the comptroller sent out a press release late yesterday describing her new role in life…

While Rauner’s agency directors have never named a cut they are willing to accept, this budget will force $3 billion in cuts to the state budget, finally bringing back some adult fiscal discipline. The imperfect, but thankfully, bipartisan political compromise does not solve all the problems Governor Rauner’s recklessness created, but it helps us stop the haemorrhaging and begin digging Illinois out of his pit.

The Office of the Comptroller has served as the chief trauma center for the state, trying to keep our schools, nursing homes and social service agencies alive. This legislation would lead us to being more of a recovery room, with a trauma unit to deal with the remaining bill backlog.

- Posted by Rich Miller        

21 Comments
  1. - Carpentersville Christy - Wednesday, Jul 5, 17 @ 10:50 am:

    Isn’t an unbalanced budget illegal according to the Illinois Constitution? Can’t it be challenged in the courts, much like pension reform?

    This would seem like a maneuver for the Illinois Policy Institute or Governor’s Office.


  2. - Slippin' Jimmy - Wednesday, Jul 5, 17 @ 10:51 am:

    Leading in Absentia


  3. - Norseman - Wednesday, Jul 5, 17 @ 10:52 am:

    Do I hear Rauner kicking himself for not putting way more money into Munger’s campaign?


  4. - Rich Miller - Wednesday, Jul 5, 17 @ 10:52 am:

    It doesn’t appear to be constitutionally unbalanced. They’re adding expenses from last fiscal year. It has to balance revenues and spending for this fiscal year, which it appears to do along with paying off as much as $8 billion in overdue bills from previous years.


  5. - Anon - Wednesday, Jul 5, 17 @ 10:54 am:

    Mendoza is just destroying Rauner now-a-days with her talking points.

    Rauner’s response “But But But she bough an SUV”

    In all seriousness Rauner has to see that 2018 isn’t looking good at all for him and he will be wasting a lot of money on his reelection


  6. - Mr. K. - Wednesday, Jul 5, 17 @ 10:57 am:


    In all seriousness Rauner has to see that 2018 isn’t looking good at all for him and he will be wasting a lot of money on his reelection

    I know there’s very little chance, but I’d love to see Rauner drop the mic and walk away.


  7. - Oswego Willy - Wednesday, Jul 5, 17 @ 10:59 am:

    I would think, in a moment of honesty to the politics…

    … Raunerites would trade almost all the GA wins, if not all, if they got Munger across the finish line.

    It was the sole race, none even close, that had the biggest impact on everything since Mendoza took the oath.


  8. - The Captain - Wednesday, Jul 5, 17 @ 10:59 am:

    Mendoza has been far more visible and confrontational than the three other Democratic constitutional officers and she seems to be benefiting from it politically. I’ll be interested to see heading into the upcoming election cycle if the other three follow suit.


  9. - RNUG - Wednesday, Jul 5, 17 @ 11:01 am:

    == His office says the legislation counts $500 million in savings on pension costs that aren’t guaranteed ==

    Yes, they aren’t guaranteed because it will depend on several factors, primarily how many people voluntarily take the offered deals / buyouts.

    That’s what happens with voluntary deals. Look back at the 2002 ERI; CMS initially planned for 2,500 - 3,000 partipants and ended up with over 11,000.

    These aren’t as good a deal as that, but they are better offers than the previous rules. They limited the participation to only 10% this time, so they wouldn’t get any big surprises … but that also limits some potential savings.

    So, unless you have information to the contrary, you go with your best guess. The passed budget claims less than Rauner’s budget estimated, so it is a more conservative number. I’m with Rich on this, book it and see what really happens.


  10. - David - Wednesday, Jul 5, 17 @ 11:04 am:

    If Rauner made illegal expenditures Mendoza should block them.


  11. - DuPage Bard - Wednesday, Jul 5, 17 @ 11:13 am:

    Watching this unfold, Rauner is getting his cake and eating it too.
    Call it a compromise or whatever you want it will be labeled, if you read today’s papers, as a Democrat tax increase.
    The public won’t understand bad spending without appropriation. They won’t understand the difference in pension cost savings.
    Rauner veto an income tax increase and the Dems override, so he gets the headline and the benefit of spending the money.


  12. - Robert the Bruce - Wednesday, Jul 5, 17 @ 11:28 am:

    I agree, OW, on the importance of the Munger election (as you pointed out before election day too; hats off).

    But if the House comes one vote short of override, perhaps Rauner will be satisfied with one of his house election wins…


  13. - Anonymous - Wednesday, Jul 5, 17 @ 11:28 am:

    Ballotpedia has a nice set of figures comparing Illinois’ fiscal issues with our neighboring states. FY2016 points include Wisconsin having significantly higher per capita spending (and slightly higher taxes). As a percent of the total budget, our state spends about two-thirds what our neighbors do in supporting education. And Illinois is missing out on Federal aid to state budgets.
    https://ballotpedia.org/Illinois_state_budget_and_finances


  14. - just sayin' - Wednesday, Jul 5, 17 @ 11:39 am:

    Why would Dems rush through an override before forcing Rauner to explain what cuts he would make? He says the bill on the table doesn’t cut enough, okay Bruce, what would you cut? So simple. The Dems strategy makes no sense to me. Rauner’s re-election prospects are about to go from very small to odds-on favorite. When Rauner wins next year, Dems will look back on this time as the unforced error which cost them the Mansion.

    The Rs who helped pass the tax hike may be able to tell GOP base they are the ones who brilliantly lured Democrats into a trap which will save Rauner.


  15. - Chicagonk - Wednesday, Jul 5, 17 @ 11:47 am:

    What are the chances that the House and Senate meet again in session in 2017 following the override?


  16. - Curl of the Burl - Wednesday, Jul 5, 17 @ 11:47 am:

    Bruce - to echo that sentiment could you imagine what would happen if the HRO had taken out Dan Beiser and one of the suburban targets who won? Their replacements would likely not have voted for a tax increase. Or if one of the suburban Senate Dems had lost? Same thing. I know that is revisionist history but on big votes like the tax increase and BIMP one vote could have easily tanked the whole thing.


  17. - Jocko - Wednesday, Jul 5, 17 @ 11:53 am:

    ==Rauner asserted that the budget package was $2 billion out of balance==

    That’s rich considering Bruce’s “workin’ together” line item to the tune of 4.6 billion.


  18. - Montrose - Wednesday, Jul 5, 17 @ 12:32 pm:

    Doing a line item veto to bring the budget into balance would slow things down. Rauner doesn’t want to slow things down because he wants to be overridden so we don’t get downgraded to junk bond status and he can say he did his part to stop the Madigan tax increase.

    It’s all about campaigning. It has nothing to do with governing.


  19. - Oswego Willy - Wednesday, Jul 5, 17 @ 12:40 pm:

    (Tips cap to - Robert the Bruce -)

    ===But if the House comes one vote short of override, perhaps Rauner will be satisfied with one of his house election wins…===

    If you look at the rationale of the “Brave 15″ and the local aspects of their districts and the impact on those districts without a budget, it’s difficult to see how the “Brave 15″ votes could differ if that rationale is the district, not the party affiliation.

    Tough to see if/how they’d move off those dimes now, but it’s possible. Would be really tough, for example those representing universities, now, but…


  20. - Team Warwick - Wednesday, Jul 5, 17 @ 2:05 pm:

    The only way to realize pension savings is to fully fund the backlog of missed state budget payments in previous years.
    the Constitution is very clear you cant reduce pension benefits, no matter how many people pretend otherwise.
    so any “billions” of savings attributed to that source are bogus vapor dollars as far as my opinion is concerned.
    one of the bogus tricks they pull on people is to speak of “avoided costs” as if they are something tangible? You dont gain anything incremental with an avoided cost. You just get a reallocated resource (so you pay sometime else).


  21. - Chicago_Downstater - Wednesday, Jul 5, 17 @ 2:54 pm:

    I must say I get a little giddy when Rauner gets a taste of his own medicine via Mendoza’s superb messaging skills.

    And yes, the hypocrisy of Rauner’s statement on the “magical budget math” is rather annoying. Unfortunately, I don’t think it will matter to his supporters. Everyone hears what they want to hear.


Sorry, comments for this post are now closed.


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