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As Pritzker warns of cuts and layoffs, let’s take a quick look at other states

Tuesday, Sep 15, 2020

* From today’s press conference…


* Pritzker also mentioned other states today when asked about the failed US Senate bill

As you know, they put this skinny CARES Act bill in the Senate up. It didn’t have enough votes to avoid a filibuster because frankly it’s not a robust enough bill. It does not take care of state and local funding that is vitally important.

States like Florida have more than $5 billion of a hole in their budget. Texas has said their hole is a historic deficit. And those are two Republican-controlled states, it’s true all across the nation. This is a problem affecting everybody.

It’s clear that the President hasn’t wanted to move forward on this, for some reason. From my perspective, this would be good for him if he moved forward on a [crosstalk].

* Here’s some info on Florida

Forecasters believe the state will have $3.4 billion less revenue than anticipated to support the state’s general fund this fiscal year due to the severe effects of the coronavirus pandemic particularly on tourism, the state’s top economist said.

In fiscal 2022, there’s expected to be $2 billion less revenue to spend and in 2023 the deficit will be $1 billion, Amy Baker, coordinator of the Legislature’s Office of Economic and Demographic Research, told lawmakers in a Sept. 10 presentation. […]

The government watchdog group Florida TaxWatch also warned that if the $5.8 billion in CARES Act funds can’t be used for traditional appropriations the state’s expected “deficit will be bigger.”

* Texas

The economic contraction associated with the spread of COVID-19 and recent volatility in oil markets warrants an update to the Certification Revenue Estimate (CRE) we published in October 2019. We now estimate the state will have $110.19 billion in General Revenue-related (GR-R) funds available for general-purpose spending for the 2020-21 biennium, down $11.57 billion, or 9.5 percent, from our October estimate. This results in a projected fiscal 2021 ending deficit of $4.58 billion, a substantial downward revision from our previously projected surplus of $2.89 billion.

The original projection was a $2.9 billion surplus.

* Problems in Georgia and Maryland

In Georgia, policymakers approved a 10 percent cut for 2021, including a nearly $1 billion cut for K-12 public schools and cuts to programs for children and adults with developmental disabilities, among others. Maryland’s governor has proposed nearly $1.5 billion in cuts; some have already taken effect, including large cuts to colleges and universities.

More at NCSL’s website.

* The big picture from the National Association of State Budget Officers

(S)tate revenue forecasts for fiscal 2021 (and fiscal 2022 for those states that have released estimates) are projecting more significant losses, especially without additional federal aid. Overall, state revenue losses resulting from the COVID-19 recession are expected to exceed the 11.6 percent drop states experienced over two years during and following the Great Recession, with some states anticipating revenue declines of 20 percent or more. Moody’s Analytics released an analysis on stress testing state budgets based on its latest economic forecasts, which estimates budget shortfalls through fiscal 2022. According to that analysis, state budgets could experience a fiscal shock (revenue declines plus increased Medicaid expenditures) of $498 billion due to a prolonged economic recovery and continuation of COVID-19 cases in the fall. This analysis assumes flat spending by states with no increases to combat the epidemic or address other needs. […]

State and local governments are major economic drivers. Their spending totaled $3.1 trillion in 2019, representing 14.7% of gross domestic product. As states continue to experience high unemployment rates, the trends seen in the fourth quarter of fiscal 2020 are expected to further depress state revenues in fiscal 2021 and beyond. Without additional federal aid to mitigate these revenue losses, states will be forced to make deeper cuts to services and spending, as well as turn to tax increases, creating a drag on economic growth at a time when the nation’s economy is attempting to recover.

- Posted by Rich Miller        

61 Comments »
  1. - Cool Papa Bell - Tuesday, Sep 15, 20 @ 1:39 pm:

    Time for Congress to at least go back and fix how existing CARES Act money can be used. Allow those funds to flow to state and local govs for now.

    Might be a little easier lift before November.


  2. - Lucky Pierre - Tuesday, Sep 15, 20 @ 1:44 pm:

    Did the Governor and his high priced staff not see that allowing a 261 million dollar pay raise to be implemented 3 months into a pandemic and then 3 months later threatening layoffs speaks to the dysfunction in Illinois government?


  3. - thoughts matter - Tuesday, Sep 15, 20 @ 1:48 pm:

    So why isn’t there a special session being called right now to deal with this while we are still in the first quarter of the fiscal year? The gap between budget and actual revenues and expenses is only going to increase and require more cuts if we wait until later. On top of that, the veto session will be at a much worse time for flu and Covid.
    But instead we want to have the legislators go do their campaigning. We don’t want to rock the boat by having them make unpopular decisions before the elections. We want to pin all our hopes on the fair tax referendum.


  4. - LakeCo - Tuesday, Sep 15, 20 @ 1:49 pm:

    Nothing Republicans like better than voting against their own interests…


  5. - Just Me 2 - Tuesday, Sep 15, 20 @ 1:52 pm:

    While I feel bad for state employees who may get laid off, the purpose of the State of Illinois isn’t to provide employment. Instead of focusing on the people who will lose their job, focus on the services that will get cut when those people aren’t there.


  6. - Rich Miller - Tuesday, Sep 15, 20 @ 1:53 pm:

    ===allowing===

    You wanna inform the class how he’s supposed to violate a union contract? Governors aren’t dictators. The last one tried that stuff and the state had to pony up.


  7. - Grandson of Man - Tuesday, Sep 15, 20 @ 1:59 pm:

    One thing we can set our lives to, that’s more reliable than the daily sunrise, is the desire of certain right wingers to cut public sector workers. They just can’t and won’t let go of it.


  8. - Blue Dog Dem - Tuesday, Sep 15, 20 @ 1:59 pm:

    Me wonders if the progressive tax revenue was included in the 10%.


  9. - Lucky Pierre - Tuesday, Sep 15, 20 @ 2:01 pm:

    Did the Governor think to inform the union that the state could not afford the pay raise and implementing it would result in more layoffs and furloughs?

    Of course not, the union thinks the money grows on trees.

    Other states with Democratic Governors and unionized state work forces were able to work together but in Illinois it is always the tail wagging the dog.


  10. - Mary - Tuesday, Sep 15, 20 @ 2:02 pm:

    Yes. We DO want public sector workers to feel the same pain we do. It’s only fair. PS workers are a protected class of people, apparently. You have to face reality just as we non-PS workers have had to do. Talk about privilege…the PS workers have plenty of it.


  11. - SAP - Tuesday, Sep 15, 20 @ 2:03 pm:

    ==The original projection was a $2.9 billion surplus.== Surplus? What’s a surplus?


  12. - Rich Miller - Tuesday, Sep 15, 20 @ 2:04 pm:

    ===special session being called right now to deal with this===

    To do what?


  13. - striketoo - Tuesday, Sep 15, 20 @ 2:06 pm:

    It is well past time to restructure Illinois government at all levels. Eliminate all township governments and special taxing districts in the state and transfer their duties to the appropriate municipality or county. Consolidate small counties. Close Eastern, Western and Chicago State Universities and consolidate those remaining under the University of Illinois. Put every existing state agency and program under a microscope and shrink or eliminate those providing services no longer relevant to the bulk of the population. Why do we have state fairs attended by a tiny fraction of the population? The voting public will not tolerate the increase in taxes needed to maintain the current bloated structure. There will be no help coming from the Feds, it is up to us.


  14. - Fixer - Tuesday, Sep 15, 20 @ 2:16 pm:

    Yep, LP, let’s do the same things Rauner did. It worked so well last time, after all. And as far as public sector workers being a “protected class”, maybe the folks complaining about the benefits folks in the public sector have should push their employers to offer some of those same things instead of trying to take it away from others.


  15. - Oswego Willy - Tuesday, Sep 15, 20 @ 2:16 pm:

    Governing is difficult.

    If your glee is measured in *anyone* getting laid off during this pandemic, I feel sorry for your cold soul. You should maybe rethink how you measure happiness in your life.

    To the post,

    Personnel is policy, and any time you lower headcount, policy also suffers. It’s a fact. This idea of “equated efficiency” is met with lower headcount and better managing more work for fewer workers, keep in mind… DCFS… as an example. Don’t be someone aghast when overworked case workers have tragedies. The unions will need to ensure the challenges and the necessary work can be accomplished without endangering this state or her people.

    I don’t envy the Governor, or his staff and crew.

    Those also making this a “Red or Blue” equivalency need to get their crayons ready to talk “Green” as in which states give more, and which states take more… of federal monies to help the states themselves.

    So, like most things these past 6 years…

    Thank you.

    … thank you for showing who you are. I believe you. I believe those seeing challenges and trying to make Illinois better, and those with child-like glee with layoffs, and pushing “Red vs. Blue” thinking, because in a global pandemic it’s important to celebrate pain, and reduced services for the most vulnerable.

    Good luck to the Governor.


  16. - BlueDogDem - Tuesday, Sep 15, 20 @ 2:18 pm:

    I am glad we already had the 6.5% ideas in hand. That will expedite the process.


  17. - Pundent - Tuesday, Sep 15, 20 @ 2:19 pm:

    =Yes. We DO want public sector workers to feel the same pain we do. It’s only fair.=

    So defund the police?


  18. - TheInvisibleMan - Tuesday, Sep 15, 20 @ 2:21 pm:

    ===and special taxing districts===

    Finally you said the quiet part out loud on what is driving this blanket push to eliminate taxing districts.

    The wealthy areas with SSAs would love nothing more than to dissolve their neighborhood SSA and roll it into a larger district where the poorer people in the town would now be paying for their luxury amenities in their gated communities.

    The masks are coming off now.


  19. - Blue Dog Dem - Tuesday, Sep 15, 20 @ 2:21 pm:

    $25 million in civil unrest repairs. That ought go over big in the suburbs and downstate.


  20. - SIU - Tuesday, Sep 15, 20 @ 2:21 pm:

    Personnel is policy, and any time you lower headcount, policy also suffers. It’s a fact.

    Please show your work (facts) to back that up


  21. - TheInvisibleMan - Tuesday, Sep 15, 20 @ 2:23 pm:

    ===So defund the police?==

    plainfield just added 3 more police officers in their board meeting last night.

    That MRAP isn’t going to drive itself after all.


  22. - Grandson of Man - Tuesday, Sep 15, 20 @ 2:24 pm:

    Are the people who want to cut state employees the ones who oppose the graduated income tax and the richest paying more?


  23. - Oswego Willy - Tuesday, Sep 15, 20 @ 2:26 pm:

    - SIU -

    As an example, it was made “clear” to me overworked DCFS workers with an overburdensome caseloads were part of the AJ Freund case.

    If that’s true, policy suffered, its mission failed, and a child died.

    Now we’re are going to lay-off more workers, understandably so.

    You don’t think agencies with those missions for children, seniors, special needs, they’ll be “good”

    Now who’s naive?


  24. - Bud's Bar Stool - Tuesday, Sep 15, 20 @ 2:33 pm:

    It’s curious that nobody is asking the administration whether it intends to make partial or full use of the $5 billion in MLF borrowing that is built into the FY 2021 budget.

    Sure, there are very good reasons NOT to do that borrowing - absent a dramatic economic recovery in the short term, it would only compound the problem in the coming fiscal year. It may also be good politics for the administration not to talk about it - the state doesn’t want the feds to think for a second that the state doesn’t desperately need more money from the feds.

    But nonetheless, that $5 billion in MLF borrowing IS a major component of this budget. And nobody is asking about it.

    It should be asked of the administration whether it plans to borrow part or all of that $5 billion to get the state through the fiscal year in the absence of additional stimulus funds from the feds.

    That is the plan that was put forward by the budget. That $5 billion in MLF borrowing is how the budget was balanced.


  25. - Ducky LaMoore - Tuesday, Sep 15, 20 @ 2:34 pm:

    If you really want to talk about a “protected class,” look no further than Jim Oberweis. He got bailed out. Tell me that he deserves it more than rank and file workers and people that rely on state services.


  26. - Mama - Tuesday, Sep 15, 20 @ 2:43 pm:

    - Lucky Pierre - Tuesday, Sep 15, 20 @ 1:44 pm:==
    It was the first pay raise they had in 4 years so it is not out of line..


  27. - SIU - Tuesday, Sep 15, 20 @ 2:44 pm:

    Media reporting there were DCFS employees involved, who failed to do there jobs. Under staffing is a built in response to government service failures.


  28. - Oswego Willy - Tuesday, Sep 15, 20 @ 2:47 pm:

    === Under staffing is a built in response to government service failures.===

    So you’re saying… that overworked caseloads aren’t happening already, AND making caseloads worse won’t be a problem?

    Or are you in the “state workers are lazy and inept” camp.

    Just say where you are so I can move on.


  29. - illinifan - Tuesday, Sep 15, 20 @ 2:47 pm:

    Just me 2 “the purpose of the State of Illinois is not to provide employment” So if they do not employ people tell me who will staff State Police offices, Secretary of State, state mental health facilities, prisons, unemployment offices etc. The state has to provide employment to ensure services we the citizens want and expect are provided. If the state is not the employer it will need to contract with private industry to provide all these services and often this costs more than what the state pays.


  30. - Mama - Tuesday, Sep 15, 20 @ 2:59 pm:

    The governor asked for a 5% cuts from all state agencies for the current fiscal year. The Unemployment Office can’t afford to cut anyone.


  31. - M - Tuesday, Sep 15, 20 @ 3:03 pm:

    “The state has to provide employment to ensure services we the citizens want and expect are provided. If the state is not the employer it will need to contract with private industry to provide all these services and often this costs more than what the state pays.”== Private business expects a good profit - - moved state services to private business will not save the state money.


  32. - Anonymous - Tuesday, Sep 15, 20 @ 3:20 pm:

    Forecast?…Doom


  33. - Cook County Thinker - Tuesday, Sep 15, 20 @ 3:28 pm:

    Financial support for higher education is a very small part of the budget. Cuts will have to come from somewhere else.


  34. - allknowingmasterofraccoodom - Tuesday, Sep 15, 20 @ 3:47 pm:

    OK, if the problem is everywhere, where does the money come from?


  35. - City Zen - Tuesday, Sep 15, 20 @ 3:48 pm:

    Just re-amortize this year’s budget over future years’ budgets. Low repayments at first that ramp up much later.


  36. - Skeptic - Tuesday, Sep 15, 20 @ 3:59 pm:

    Maybe term limits are the answer after all. /s


  37. - Collinsville Kevin - Tuesday, Sep 15, 20 @ 4:08 pm:

    Kick the can down the road, repeat. Kick the can down the road, repeat. Kick the can down the road, repeat. Obviously state politicians have no intention whatsoever of making the state live within its means.


  38. - Norseman - Tuesday, Sep 15, 20 @ 4:14 pm:

    Add to this the failure of Fair Tax. I’ve seen nothing from Fair Tax down here. It’s all the no campaign’s baloney. I’m wondering if I missed the Rich post that JB hired Brad Parscale to run the Fair Tax Death Star.


  39. - Oswego Willy - Tuesday, Sep 15, 20 @ 4:18 pm:

    === Add to this the failure of Fair Tax.===

    If the Fair Tax fails…

    … it will arguably be in the colossal failures of Illinois political lore.

    Sitting on $50+ million for weeks upon weeks, 1.3+ million absentee ballot requests, and not meeting the threshold?

    It could be a colossal failure, burning daylight.


  40. - Ducky LaMoore - Tuesday, Sep 15, 20 @ 4:33 pm:

    “OK, if the problem is everywhere, where does the money come from?“

    I don’t know, maybe the place that was already spending a trillion more than it was taking in during, “the best economy ever.”


  41. - Last Bull Moose - Tuesday, Sep 15, 20 @ 4:43 pm:

    State government was hollowed out under Rauner. Now Pritzker has to cut further.
    I think the Feds should cover the COVID revenue losses. If they don’t, I see both tax increases and the state having to cut services.


  42. - Chicagonk - Tuesday, Sep 15, 20 @ 4:52 pm:

    @City Zen - That comment had me chuckling. Only in Illinois can you have an industry pop up that makes money based off the state government being unable to pay bills on time.


  43. - SIU - Tuesday, Sep 15, 20 @ 4:57 pm:

    You have not shown any facts, just your opinion.


  44. - Just A Dude - Tuesday, Sep 15, 20 @ 5:17 pm:

    “I’ve seen nothing from Fair Tax down here. It’s all the no campaign’s baloney”
    Been wondering that myself. Saw my first pro TV ad,(metro east market), just a bit ago. I have seen the “farmers saying to vote no” ad many times over the past couple of weeks. Hope it is the start of a fair tax TV blitz. I had been fairly confident it would pass, though expected more pro support before now.


  45. - IT Guy - Tuesday, Sep 15, 20 @ 6:31 pm:

    Here’s a quote from a NY Times opinion article. I’ve included the URL for the entire article as it also touches on increasing taxes for those that can afford it. One of the authors is a Nobel laureate in economics.

    “Using conservative estimates, these ripple effects mean that each dollar of spending the state cuts leads to a drop of at least $1.50 in the gross domestic product, and there are reasons to believe that the drop is as much as $2.50. With state budget shortfalls forecast to approach $300 billion this fiscal year, a spending-cut-only approach to balancing state budgets will cause at least a $450 billion reduction in G.D.P.— more than 2 percent.”

    https://www.nytimes.com/2020/09/03/opinion/sunday/progressive-policies-taxes.html?searchResultPosition=6


  46. - Anon - Tuesday, Sep 15, 20 @ 8:01 pm:

    Gov JB covid playbook destroyed Illinois’s economy.


  47. - Oswego Willy - Tuesday, Sep 15, 20 @ 8:06 pm:

    ===…destroyed Illinois’s economy.===

    You can’t have an economy without first handling the virus.

    The virus is wrecking things.

    Get people to wear masks, social distance and quarantine if necessary.


  48. - Southern Dude - Tuesday, Sep 15, 20 @ 8:21 pm:

    Get people to wear masks, social distance and quarantine if necessary.

    He could have shut down the schools, but he chose not to. He bans indoor dining in certain regions, but sends kids to school to eat in a cafeteria. Political decision.


  49. - Oswego Willy - Tuesday, Sep 15, 20 @ 8:32 pm:

    === He could have shut down the schools===

    School districts can choose on their own how they want schooling.

    Aren’t you for local control?


  50. - Oswego Willy - Tuesday, Sep 15, 20 @ 8:34 pm:

    === He bans indoor dining in certain regions===

    … where Covidiocy seems to be winning it seems.


  51. - Southern Dude - Tuesday, Sep 15, 20 @ 8:38 pm:

    Aren’t you for local control?

    He whines about the lack of Federal response, but doesn’t have a State response to schools. Your hypocrisy is noted.


  52. - Oswego Willy - Tuesday, Sep 15, 20 @ 8:43 pm:

    === He whines about the lack of Federal response, but doesn’t have a State response to schools. Your hypocrisy is noted.===

    LOL

    Nah.

    I’m actually mocking… this idea that the lack of a federal response is now wholly ignored to a local state response, but your idea of looking for hypocrisy is comically noted.

    Remember;

    It’s a deadly virus. Deadly.

    The President of the United States purposely downplayed it, and undercut that truth. The Governor did not.

    Anything else?


  53. - billy boy - Tuesday, Sep 15, 20 @ 9:08 pm:

    you told him willy good job with out the progressive tax every one can see a major tax hike also cuts where we can not afford to have them health care child care are just starters


  54. - Pylorus - Tuesday, Sep 15, 20 @ 9:15 pm:

    Southern Dude, I’m confused by your school cafeteria comment. The students are seated 6 feet apart, they wear their mask until they sit down and put it back on when they get up. There’s no wait staff to infect and no bus boys to worry about cleaning up possibly infected utensils. All of that follows the state department of health guidelines. I doubt the restaurants in the Metro East are following all of those stipulations.


  55. - Southern D u d e - Tuesday, Sep 15, 20 @ 9:21 pm:

    doubt the restaurants in the Metro East are following all of those stipulations.

    You doubt? I guess the food serves itself, nobody cleans the cafeteria, and only kids can follow guidelines. Not much difference between a school cafeteria and a restaurant


  56. - Oswego Willy - Tuesday, Sep 15, 20 @ 9:25 pm:

    - Southern D u d e -

    Your beef is with the school boards.


  57. - Oswego Willy - Tuesday, Sep 15, 20 @ 9:39 pm:

    - Southern Dude -

    “Good luck”


  58. - thoughts matter - Tuesday, Sep 15, 20 @ 10:02 pm:

    ===special session being called right now to deal with this===

    ==To do what?==

    To adjust the budget that they passed that’s going to have a shortfall. Or does that responsibility rest solely with the constitutional officers? IDES and DCFS are overworked now. Shouldn’t some oversight be applied for the required cuts?


  59. - Nope18 - Wednesday, Sep 16, 20 @ 8:18 am:

    The same people that are criticizing state workers are the same ones throwing a fit about the unemployment office’s response and the health departments response and dcfs not protecting children and the board of education not doing a good enough job and on and on. You all decided that unemployment office’s weren’t important. There are hardly any offices left. People with 30 year careers lost their jobs, and were the people that would have known the best way to handle all this. The raises were passed years ago and would be near impossible to undo. Both of those were Rauner decisions. Cannabis sales have been in the billions though. Every school I know is eating lunch in the classrooms. Progressive tax is the most financially sound tax policy there is. No one get hurt. Rich people are still rich, poor people need less assistance. What kind of Jim Jones kool-aid do they serve in this state?


  60. - Nope18 - Wednesday, Sep 16, 20 @ 8:18 am:

    The same people that are criticizing state workers are the same ones throwing a fit about the unemployment office’s response and the health departments response and dcfs not protecting children and the board of education not doing a good enough job and on and on. You all decided that unemployment office’s weren’t important. There are hardly any offices left. People with 30 year careers lost their jobs, and were the people that would have known the best way to handle all this. The raises were passed years ago and would be near impossible to undo. Both of those were Rauner decisions. Cannabis sales have been in the billions though. Every school I know is eating lunch in the classrooms. Progressive tax is the most financially sound tax policy there is. No one get hurt. Rich people are still rich, poor people need less assistance. What kind of Jim Jones kool-aid do they serve in this state?


  61. - Colin Robinson - Wednesday, Sep 16, 20 @ 10:49 am:

    Is this a way for JB to drum up votes for Biden or is the lay-off threat real?


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