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Today, Governor JB Pritzker signed Executive Order 2025-05 directing state agencies to identify up to 4% of Fiscal Year 2026 General Funds appropriations to reserve in order to mitigate the impact of Trump’s disastrous economic policies while working to maintain core services. The action comes as all states, including Illinois, are forced to manage the Trump and Congressional Republicans’ budget bill that threatens state revenue streams and places pressure on Illinois’ fiscal stability.

Trump’s reckless economic policies are wrecking state economies, stifling job growth, and increasing unemployment in key sectors. At the same time, Trump’s tariffs are taxing working families, increasing the costs of everyday goods and disrupting supply chains. This chaos is making it harder for businesses to hire, expand production, or maintain payrolls. In the coming months, Trump’s budget bill will further compound these pressures, creating uncertainty over state revenues as slower economic activity directly affects the amount of revenue collected and ultimately puts funding for core services at risk. To protect the State’s fiscal stability, Governor Pritzker is directing agencies to take proactive steps to brace for these challenges and work to maintain core services.

“Illinois has built a strong economy and proven its fiscal responsibility, but Trump’s disastrous policies threaten to undo that progress,” said Governor JB Pritzker. “Trump and Congressional Republicans sealed one of the largest wealth transfers in American history, stripping health care, food assistance, and other essential supports for working families to fund permanent tax breaks for the wealthy. At the same time, tariffs are hurting our farmers and businesses, slowing job growth, and driving up costs for Illinois families. I’m taking executive action to mitigate the impact of Trump’s economic policies on our state finances, maintain critical services, and preserve our economic stability.”

Under the order, agencies under the Governor will:

- Conduct immediate budget reviews to identify efficiencies and reductions.

- Identify up to 4% of General Funds appropriations for FY26 reserves to reinforce state finances.

- Limit non-essential spending, purchases, and travel.

- Review all hiring decisions and prioritize only essential roles.

- Propose programmatic changes or appropriation transfers if FY26 budget shortfalls emerge.

Agencies must submit reports on their progress to the Governor’s Office and the Governor’s Office of Management and Budget (GOMB) within 30 days. Key obligations such as pension payments and K-12 funding, and offices outside the Governor’s authority (i.e. legislative, judicial, and other constitutional offices) will not be impacted. The Executive Order will take effect immediately.

Trump’s Budget and Tariffs Are Undermining Illinois’ Economic Growth

For years, Illinois’ economy has been on the rise. As the nation’s 5th largest economy, the state surpassed $1 trillion in GDP in 2022 and steadily grew revenues. That growth enabled Gov. Pritzker to deliver seven balanced budgets, secure nine credit rating upgrades, and eliminate a massive bill backlog. Now, Trump’s budget bill and tariffs are already undermining growth and threatening the fiscal stability Illinois worked hard to build.

- Farmers Feeling the Pinch: Illinois’ $13.7 billion agriculture industry is being pummeled by tariff-driven trade disruptions, costing farmers income and jeopardizing jobs across rural communities

- Gutting of Medicaid and Rising Premium Costs: Cuts to Medicaid and Affordable Care Act (ACA) coverage will remove healthcare access for an estimated 330,000 Illinoisans, raise premiums for those insured, and risk hospital closures in rural areas.

- State Revenues Under Pressure: Because most state tax codes are tethered to federal law, Trump’s giveaways to the wealthy automatically slash states’ revenues, including in Illinois, potentially reversing years of growth and fiscal stability. These changes
will affect Illinois as well as other states’ revenue outlooks for the foreseeable future.

- Cuts to SNAP Threaten Families: Reductions in SNAP and other supports shift costs directly onto states and will leave an estimated 360,000 Illinois families at risk of losing access to these benefits and forced to fend for themselves as costs continue
to rise.

- Cooling Labor Market: The August 2025 jobs report confirmed a national slowdown, with only 22,000 jobs created nationwide and unemployment reaching its highest level since 2021. Illinois mirrored that trend, shedding 13,300 payroll jobs in August, the
state’s largest monthly decline since July 2023 and the fifth overall drop this year with employers squeezed by tariffs and Trump’s anti-immigrant policies restricting access to needed workers, leaving businesses unable to hire, expand, or keep pace with demand.

While no state in the nation — including Illinois — can fully backfill the cuts imposed by the federal government, Gov. Pritzker remains committed to mitigating their impact wherever possible. This action echoes previous budget reserve measures including those implemented during the COVID-19 pandemic, when agencies were asked to conserve resources to maintain fiscal stability amid uncertainty.

Today’s action also builds on Gov. Pritzker’s efforts to address the economic challenges created by Trump’s tariffs on Illinois businesses and workers. Earlier this summer, Gov. Pritzker signed an Executive Order directing agencies to evaluate the scale and impact of Trump’s tariffs in key economic sectors. He has also led trade missions, signed economic cooperation agreements with the United Kingdom and Mexico, and continued engagement with international leaders, including the Canadian Ambassador to the U.S. and the Consul General of Mexico in Chicago.

Click here to read the EO.