Pritzker asked why he didn’t propose tax cuts
Friday, Feb 17, 2023 - Posted by Rich Miller
* From yesterday…
* Pritzker’s response to the first question…
Well, let’s start with we did cut taxes last year when we had a surplus that we could put toward temporary tax break for everybody when inflation was going up. We did that. And I’ll continue to look for ways to put money back into peoples’ pockets with tax breaks. I also want to point out we’ve underfunded our education system, we’ve underfunded early childhood education. And so we’re trying to do things simultaneously as resources are made available. But remember, none of this can be done, I want to point this out and make sure everybody pays attention, can’t be done if you don’t balance the budget and make sure you’re allocating if you have surplus resources, allocate them properly when we thought those were one time funds over the last couple of years because some of it came in from the federal government. We said we’re only going to put them toward one time expenditures. And that meant for example, paying down debt for the state, we paid down almost $11 billion of debt for the state as a result of those excess revenues or surpluses that we saw, because we weren’t sure about whether we were going to see continued increases in our state sources of revenue. We now are looking at the state sources, we’re not seeing any federal revenue to augment that and yet we’re still running surpluses. That’s why we have surpluses here in FY23. It’s allowed us to pay down more debt. But and some of it will go to, for example, the pensions. We’re seeing that as a stable level of revenue. We dropped the revenue estimate by about one and a half billion dollars for next year. Because again, being prudent, I’ve been very conservative about revenue estimates. And so going into the next year, we’re actually proposing less revenue and lower spending overall than we had in FY23. And we’re dedicating that to trying to uplift our children across the state.
Please pardon all transcription errors.
* And here’s his response to the second question…
Oh, believe me, I want to make any tax cuts that we could propose permanent. Let’s start with that. I would like to lower everybody’s taxes. That’s number one. I’d love to do that. We also as you know, have deficits that have been run. I’m talking about infrastructure, investment deficits, deficits and investing in education that we need to work on simultaneously with trying to get more money back into people’s pockets. We’ve not raised taxes. In fact, we’ve held taxes the same. What we’ve seen is a level of economic activity in the state and our GDP rising, and that has brought in more dollars in our regular you know three big sources of revenue and that sales tax, individual income tax and corporate income tax, and we’re trying to put those in the right places. We’re getting to where we want to be in Illinois, again, rising in the rankings. And one thing to point out to you is that today, we’re number six in the country in K-12 education according to US News and World Report. And we’re number one among the most populous states in the country, the 10 most populous states we’re number one. I want us to maintain that I want us to make sure we’re investing in the right things. I have to say early childhood is absolutely the best place.
The only USNWR state rankings I could find use data that’s four years old.
* But here’s a good point from Ralph Martire of the Center for Tax and Budget Accountability…
(A)round 95% of all General Fund spending on services goes to the four core areas of Education (Pre-K, K-12, and Higher Education), Healthcare, Human Services, and Public Safety. For too long, the state’s structural fiscal problems have forced decision-makers to cut Illinois’ real, inflation-adjusted investment in those core services. Just last year, Illinois’ funding for those services was collectively 16% less in real terms than it was in FY 2000, resulting in inadequate funding for schools, and inadequate capacity to meet the health, safety, and human service needs of everyone from senior citizens to individuals with disabilities, mental health concerns, or who have suffered from domestic violence. [Emphasis added.]
There’s more in Ralph’s report, but I went over it with subscribers earlier today, so I’ll just leave it at that.
