* Keep in mind that nothing is set in stone yet. Here’s the Sun-Times’ take on what’s going on…
Gov. Quinn and the two Democratic legislative leaders honed in on a potential tax-hike deal Tuesday that could raise the state’s share of workers’ paychecks to as much as 5 percent, a 66 percent jump.
Multiple options remained on the table and nothing had been finalized, but Quinn administration sources held out hope a tax-increase pact with House Speaker Michael Madigan (D-Chicago) and Senate President John Cullerton (D-Chicago) could be struck as soon as today.
Among the proposals discussed during two rounds of closed-door meetings between the three Democrats were increasing the individual income tax rate from 3 percent to 5 percent or increasing it by as little as one half of a percentage point. In both cases, the leaders were contemplating making at least part of the increases temporary, sources said.
Publicly, no one in the talks would divulge specifics on a tax plan, though Cullerton late Tuesday characterized both tax-hike scenarios as “pretty accurate.”
The governor also is floating the idea of borrowing approximately $14 billion, to be repaid over 14 years, largely to catch up on a backlog of unpaid bills, fully fund state worker pensions this budget year and help pay the costs for next year, a key lawmaker said. The borrowing would be repaid by raising the income tax rate by a quarter- or half-percentage point, above any other tax hike lawmakers might approve.
But internal polling of Madigan’s House Democrats showed significant support for a temporary 1-percentage-point increase in the state’s 3 percent personal income tax rate, with some arguing the hike would be too small to fix Illinois’ long-term budget imbalance, said a source familiar with the vote-counting effort who was not authorized to speak publicly. […]
One factor that could hurt Democratic support is Quinn’s reluctance to agree to limit state spending at current-year levels or lower. A spending cap has been a condition for some downstate Democrats to back an income tax hike.
It’s not an argument, it’s true. If they don’t make big cuts, a one-point hike ain’t enough.
“It’s political suicide for a lot of people, and we all know that, but the right thing has to be done here,” Lyons said. “Being popular isn’t always right. Being right isn’t always popular. The old cliche is so applicable toward this thing. It’s sad.”
* Meanwhile, House Speaker Michael Madigan advanced his latest constitutional amendment yesterday…
A state constitutional amendment aimed at making it harder to sweeten public employee pensions moved to the floor of the Illinois House Tuesday, but its sponsor, House Speaker Michael Madigan, couldn’t answer key questions about the measure.
If approved by voters, the amendment would require three-fifths votes by legislators to increase pension benefits for employees of state and local governments and school districts. Such changes now take only majority approval.
The bill passed out of the House Personnel and Pensions Committee on a 7-3, party-line vote with all Republicans, including Reps. Raymond Poe, R-Springfield, and Rich Brauer, R-Petersburg, voting “no.”
The two Republicans listed, it should be noted, have a whole lot of state employees in their districts.
Lawmakers last spring and last month approved slimmed-down pension benefits for new teachers, state university employees, state workers, judges, legislators, firefighters and police officers. But Madigan said he’s worked on his proposal for the past two years so the sins of the past aren’t repeated – especially after he’s left the Legislature.
“Certain representatives of those organizations have been telling people in casual conversations ‘We’re just going to wait it out until Madigan’ s out of there, and then we’re going to run bills to repeal all of it.’ That’s their attitude, and that’s what you’re looking at going forward,” he said. “And so this is designed to raise the bar. And simply say, ‘Look we now know, given the fiscal condition of the state pension systems and the local systems, that this is an extraordinary situation. This is not something that should be handled in the ordinary course. There ought to be a high bar to move these bills.”
