Statement from the office of Illinois Senate President John J. Cullerton. Please attribute to spokesman John Patterson.
The Illinois Senate will be in session Tuesday morning to vote on a balanced budget.
The Senate President attended a leaders meeting this afternoon with the expectation of finalizing an agreement on workers compensation and property tax relief legislation as part of the ongoing effort to win the governor’s signature on a balanced budget. Unfortunately, the Republican leaders skipped the meeting.
The Senate is committed to finishing the work it began in January and hopes to finally find bipartisan agreement to put an end to this chaos and restore stability to our state.
I think what you saw with Republicans engaging in bipartisan support of the [tax hike] bill, in my judgement, was a reaction to the positions adopted by Gov. Rauner; the tactics employed by Gov. Rauner and his staff over several months.
So, we have not had a normal legislative process in the Illinois legislature. There’s been an undue level of intimidation by the governor and his staff relative to people in the legislature. […]
Despite what the Tribune says about me, I only engage in persuasion. I work with my members. We thoroughly discuss these issues in our caucus. My method is to use intellectual persuasion, to persuade Democratic members and sometimes Republicans on the wisdom of a position or a vote. I don’t engage in intimidation. I don’t engage in threats. And you won’t find one member of the legislature who would ever tell you that… I’ve been here long enough to know that it doesn’t work.
“Persuasion” can sometimes be in the eye of the beholder. Also, he doesn’t have to issue threats because people already know what crossing him entails.
I will veto Mike Madigan’s permanent 32% tax hike. Illinois families don’t deserve to have more of their hard-earned money taken from them. pic.twitter.com/7F9xkl2S5X
Moving forward, this vote shows that if the legislature is willing to pass the largest tax hike in state history with no reforms then we must engage citizens and redouble our efforts to change the state.
* Speaker Madigan told reporters today that he “would move to override” all three bills the House has passed over the past couple of days. Those would be the tax hike, the approp bill and the BIMP.
Those are all Senate bills, however, so the Senate Democrats would have the first crack at an override motion, and they have their own issues right now. But Madigan predicted the Senate would approve the bills.
* Madigan said he thought the two Republican leaders “should have been here” for today’s scheduled meeting of the four tops.
The House Speaker said he would schedule another meeting tomorrow at 10 o’clock in the morning..
“We’re continuing to work on what we call the ‘off-budget’ issues,” Madigan claimed. “We will continue to work with [the Republicans] until it’s resolved.”
* Senate President John Cullerton just told reporters that the two Republican leaders did not attend today’s leaders’ meeting, which had been scheduled to begin at 1 o’clock.
I told subscribers earlier today that this might happen. After yesterday’s tax hike vote, the Republican leaders wanted to avoid “negotiating the terms of their own surrender.”
Cullerton told reporters that he was still very willing to work on non-budget issues like workers’ comp and a property tax freeze. “We are still ready to move legislation regarding reforms, not just what the House has acted on, pending caucus talks,” Cullerton said.
* When asked whether he had enough Democratic votes to pass the tax hike on his own, Cullerton said he’d have to ask his caucus first, but said it would be “very difficult” to do it without GOP votes. The Senate Democrats put 32 votes on SB 9 in May, but they’ll need 36 to pass it this time around.
As I also warned subscribers, Cullerton said he had some missing members today.
Below is a statement from State Rep. Steve Andersson (R-Geneva) on his support of the budget compromise that passed the House on Sunday with bipartisan support.
Yesterday I voted to create a balanced budget for the State of Illinois for the first time in more than 2 years by voting for SB 6 and 9. In addition to reducing spending by approximately 3 billion dollars, we needed to also increase revenue, which required an income tax increase to slightly lower than what Illinoisans were paying in 2014. I did not want to vote for a tax increase, and like my fellow Illinoisans, I do not want to pay a tax increase. However, it was, at this juncture, the only viable option.
Why? Here are the realities that we faced that led us to this place:
1. If we had not acted, as the bond markets opened today, the State would be downgraded to junk status- the first time for any state in the entire country. “Junk” is more than just a clever name. With a junk rating, most institutions legally cannot buy our bonds. This makes our ability to borrow virtually non-existent which is essential to even keeping minimal state services functioning. Without funding, our universities and community college faced de-accreditation. This would gut our institutions of higher education which not only are commercial drivers in the state, supporting entire communities, but provide education and opportunities keeping our students in Illinois to help build the future of our state. Instead, those students would be uprooted in the middle of their education, and they would have to find alternatives, if that is even possible.
2. The Comptroller advises that starting in July the state’s cashflow will enter a stage where we won’t have enough money to pay our core bills (these include items such as bond interest payments, state employees’ salaries or anything else) because we will only be paying back due bills. In other words, Illinois will have no money at all for expenditures, and being in junk bond status, no ability to borrow. Further, last week a Federal Judge ordered the state to prioritize payment of back due Medicaid payments to the tune of 600 million dollars a month in addition to everything else we are required to pay. It is not an exaggeration to say that there was the very real possibility that the state of Illinois would not be able to survive this added burden.
Simply put, the state was out of money and about to actually shut down and we were out of time as key financial raters threatened to reduce the credit rating of the state as soon as Monday. Yesterday was the absolute last chance to avoid this catastrophe and absolutely, the last and final resort we had.
Of course, nobody wants a tax increase.
Some have argued to “hold out” and pass a better designed budget with just budget cuts. This would require cutting as much as 45% of anything that was “cutable”. This means police, fire protection, schools, higher education and social services. The reality is “cuts only” did not have the votes. Without the votes, even the best budget will never become a reality. And in this case those votes simply did not exist and would not exist.
So, we were left with two bad choices and only two bad choices. As your legislator, I was sent here to govern and I had to pick the least bad of the two horrible choices. I chose to save the state first and continue to fight for reforms. The other option was to me unthinkable, irresponsible, and immoral. To allow the state to fail was in my eyes, just not an option. If I allowed that to happen, the resulting damage would spell disaster for our state and be decades in the recovery, if at all.
Now as a result of this action, the State can live on. More negotiations can and are happening and we continue to have a chance to improve our state. The other choice effectively ended the State of Illinois. As my friend Rep. David Harris said, I was not elected to preside of the destruction of our great state. That was not an option for me, either - I chose survival for the State of Illinois. And I believe I made the right choice given the circumstances.
* Meanwhile, Rep. John Cavaletto (R-Salem) explained his vote for a tax hike to a local radio station…
Cavaletto said the turning point for him came when the Republican caucus was given information on the devastating impact and scary situation the state’s bond rating being reduced to junk status would have on Illinois. He questioned how the state could build itself back from the bankrupt situation and said an increase in the income tax didn’t worry him as much.
Cavaletto said you could have heard a pin drop in the Republican caucus after the presentation.
“I hate tax increases, hate them, and it will hurt small business to do this, but I also think it hurts small business when you ask them to do business with the state and then you don’t pay them,” she said. “We must have a balanced budget, and if that means that we must increase taxes right now to do it, I, like one of my other colleagues, know I’m probably going to get primaried on this,” she said, referring to the possibility of losing her seat in the next primary election.
“Do I want to raise taxes? Absolutely not. Do I think it’s the right thing to do down the road? Absolutely not. But I want you to remember what we’re doing here today. We’re paying the bills for our bad behavior, even before I came here.”
“There are a couple of organizations in the state that are extremely far right, and their preference is to burn the place down and then build it back up again, and they are never going to think it’s ok to vote for a tax increase. “
If Rauner does veto the plan, he will be able to run for re-election without the albatross of having been the Republican responsible for permanently bringing the income tax rate up from 3.75 to 4.95 percent—a 32 percent jump.
That’s only if the GA successfully overrides him (or even tries). But, yeah. I and others have been saying this for weeks and weeks. A veto override gives the governor all the benefits of the new state revenues and the anti-tax political issue.
In voting for the tax hike before Rauner’s sought-after reforms, the governor loses leverage in future negotiations.
But [Rep. Steve Andersson, R-Geneva] says Democrats still have incentive to work with Rauner on his [non-budget]wish list.
“The governor still needs to sign this,” he said. “There is a motivation to get to a ‘yes’ from him so that we don’t have to come back and override”—something there is no guarantee would succeed.
Rauner has repeatedly threatened to veto a permanent income tax hike unless it’s tied to a permanent property tax freeze, and the bill the House passed was a permanent income tax hike.
The increased likelihood that Illinois (BBB-/Watch Neg) will soon have a budget in place is a development with significant credit implications, in S&P Global Ratings’ view. Passage of tax and spending legislation by Illinois’ House of Representatives on July 2 represents a meaningful step toward the enactment of a comprehensive budget for fiscal 2018.
We had previously indicated that, in our view, because of the state’s structural deficit and the magnitude of its unpaid bills, its fiscal trajectory was unsustainable. More immediately, a recent federal court ruling (and the potential for others) compelling the state to fund more of its obligations each month threatens to provoke a liquidity crisis. The protracted failure of Illinois’ lawmakers to assert governing control over the state’s finances has, in effect, begun to directly undermine the state’s discretion over the allocation of its resources.
Enactment of a comprehensive budget with revenue and expenditure alignment could help put a halt to this erosion of the state’s sovereignty over its fiscal affairs. In this way, the legislation passed by the House could represent the first step in a stabilization of Illinois’ fiscal outlook and may lead to an easing of pressure on the state’s credit quality.
Even with a budget, however, it’s likely that Illinois’ finances would remain strained and vulnerable to unanticipated economic stress. In addition to having accumulated record amounts of payables, the state’s university system has been deprived of state funding since January 2017. If a budget is enacted, the degree to which it closes the state’s structural deficit, provides a pathway for addressing the backlog of unpaid bills, and its impact on cash flows, will be important factors in our review of its effect on Illinois’ credit quality.
Conversely, in the event progress toward a budget falters, the weakened condition of Illinois’ finances and liquidity provide it with minimal margin at its current rating level, as detailed in our June 1 CreditWatch placement statement.
* Starting right now and running through the remainder of this overtime session, I’m banning the use of exclamation points in comments. If you use an exclamation point, your comment will have to be approved manually - by me - and it will only be approved if you use it in a humorous, ironic or other acceptable manner. I’m sick of the uptick in shouting, particularly from the newbie trolls on both sides. Yeah, tensions are high, but go scream on Facebook if you feel such urges. Get it out of your system and then you can come back here.
If I could, I’d also ban the use of all capital letters, but I’m not able to do that. I’d love to ban the improper use of “your” when it’s used as a contraction of “you are.” I’d also love to ban the misspelling of “lose” as “loose,” or “ad” as “add,” or “moot” as “mute.” Alas, none of that can be done, either. But lemme tell ‘ya, that stuff drives me up a wall when I see it.
* The Question: What word or words would you like to see banned from the comment section? Explain.
House Democratic women request meeting with Gov 2 implore him to retract his threat to veto the budget & save our state from junk status. pic.twitter.com/pY3AxYnDCx
— Rep Sara Feigenholtz (@StateRepSara) July 3, 2017
Sit in by House Democratic women in Gov Rauners office demanding a meeting to save our state and keep schools open!! #DoYourJobpic.twitter.com/DL1T4pwkeU
GOP Reps. Barbara Wheeler, Keith Wheeler, Margo McDermed, Grant Wehrli, Tony McCombie, Lindsay Parkhurst, Jeanne Ives and Peter Breen showed up.
The group of anti-tax Republicans whipped out their own phones and apparently started asking the Democrats about their tax hike plan. The Democrats then returned to the floor. I’m hoping to find video of the latter exchange. If you see it somewhere, post a link in comments.
…Adding… From the Democratic women…
“We believe now is the time to end this state budget impasse and yesterday’s votes are an important step toward a solution. Our group today visited the Governor’s office to request a meeting with the Governor to ask him to approve this package.
We have made significant compromises and have seen bipartisan support for a balanced budget. Rather than issuing veto threats, we want to meet with the Governor to explain why this is the right solution and hope he will meet with us soon.”
* This is a huge blow to the Illinois House. Bipartisan, hard-working, tenacious and an all around good guy…
State Representative Chad Hays (R-Catlin) announced today that he will not seek reelection in 2018. He has served in the General Assembly since December of 2010 and as Assistant Minority Leader since 2013.
“Serving in the Illinois House of Representatives has been a supreme honor and a tremendous privilege,” said Hays. “I have been a passionate advocate for Vermilion and Champaign Counties and the East Central Illinois area, and sincerely appreciate the opportunity to temporarily occupy the seat representing the 104th District.”
Hays pointed to a changing political climate in Springfield as a contributing factor of his upcoming exit from State politics. “The functionality of the Illinois General Assembly today is simply untenable and counterproductive,” said Hays. “Legislators who care deeply and have the courage of their convictions and the intestinal fortitude to do what is right regardless of consequences are increasingly silenced. I believe we are in serious jeopardy of independent thought being a relic in our public discourse.”
The current dislike and distrust between the Governor and Speaker of the House has paralyzed government in Illinois. Ego, money and power eclipse the desire of well-meaning and honest public servants. Blame, press conferences and talking points have replaced governing. Voices of moderation and reason are increasingly elbowed out by well financed fringe elements.
Our State faces financial calamity due to years of spending well beyond its means and the collective inability of leaders to put petty, partisan differences aside for the common good.
The Governor’s office has struggled with identifying which fights to fight and what constitutes victory. Politics is the art of the doing the doable, particularly when you are in the minority. The pathway to success for the Administration is to seek and build upon incremental progress.
The rules of engagement in the House of Representatives are the conduit to one man unilaterally controlling the Legislative process in a total and complete end run around Democracy. The stifling nature of the House Rules render “we the people” void of a voice or even a venue from which to be heard. The House has become a remote outpost in relation to what our Founding Fathers had in mind.
There truly are legislators who care deeply, have the courage of their convictions and the intestinal fortitude to do what must be done regardless of consequences. They are increasingly silenced and dwarfed by monied bullies. We are in serious jeopardy of independent thought being a relic in our public discourse.
The functionality of the Illinois General Assembly today is simply untenable and counterproductive.
* For months, newspapers, pundit, etc. have been screaming “Get a budget!” So, what happens when the House passed what appears to have been a balanced budget? Check out the headlines…
* Tribune: Madigan’s House approves major income tax hike as Republicans break with Rauner
* Sun-Times: Illinois House OKs income tax hike, spending plan; Rauner vows vetoes
* AP: Rauner says he’ll veto hike in Ill. income tax
* Daily Herald: Rauner promises to veto income tax hike
All tax hike, all Rauner veto, all the time. With a sprinkling of “Madigan!”
Polling consistently shows that Illinoisans do not want a tax hike. So, from that perspective, Gov. Rauner “won” today’s headline war.
*** UPDATE 1 *** From the Illinois Republican Party…
Hey Rich,
In addition to the headlines you posted, Governor Rauner’s message is also cutting through the clutter on social media. The Governor’s veto message on the Bruce Rauner Facebook page was the farthest reaching organic post ever for Rauner. That post has already organically reached over 300,000 individual newsfeeds.
Taken together, posts from Rauner and ILGOP pages about Madigan’s tax hike and last minute budget organically reached over 550,000 newsfeeds since yesterday. That’s not even including the Governor’s official side veto post, which received even more shares.
The prospect of Madigan’s massive tax hike - the largest in state history since it is a permanent increase - is activating voters who otherwise have been passive observers of the impasse so far.
* From Comptroller Mendoza’s statement last night…
We still have a long road ahead to a comprehensive budget plan to pay down our $15 billion backlog of unpaid bills that has tripled in the two years since Governor Rauner took office.
It’s actually worse than that. Except for K-12, last year’s stopgap budget only contained appropriations for half the year. Universities, social service groups, business vendors, etc., etc., etc. never got an appropriation for the second half of Fiscal Year 2017, which ended Friday.
The second half of FY 16 ended the same way and the state’s leaders just sent that down the memory hole.
So, they not only need to deal with most of that backlog (they don’t have to deal with all of it at once, just as long as they can get it down to a 30-day payment cycle), they also have to figure out what to do about the billions they never got around to appropriating in the first place.
* Aside from passing a temporary tax and then not preparing for its partial rollback, the other giant failure of the Democrats in 2011 was not dealing with the overdue bills. That debt was like a massive ball and chain being dragged around by the government’s neck, and it didn’t get resolved for four years, helping to convince folks that the tax hike “didn’t work” and that Pat Quinn was a failed governor. Borrowing to pay off that debt would’ve done wonders for Quinn, and so I’m curious whether the Democrats will “help” Rauner out this time.
The Illinois House of Representatives on Monday passed a bill for the final piece of the state’s fiscal 2018 budget that includes authorization for $6 billion of bonds to pay down a $15 billion bill pile.
The budget implementation bill was sent to the Senate on a 72-36 vote. The House on Sunday passed appropriation and revenue bills that require concurrence votes in the Senate.
In passing the budget implementation bill, a dozen House Republicans joined majority Democrats to reach a 73-vote threshold that could withstand a possible veto by the governor if the measure passes the Senate. Republican Governor Bruce Rauner has already said he will veto the revenue bill that includes a big income tax rate hike. […]
State Representative Greg Harris, the House Democrats’ budget point person, said enough money has been identified only to cover debt service on $3 billion of bonds and that the rest of the debt could be issued once additional revenue is available.
Sigh.
$3 billion is almost a point on the income tax.
There’s also some dispute over the language in the BIMP about when the bonds are supposed to be paid back.
Rep. Sue Scherer, D-Decatur, voted for the spending bill but against the tax increase legislation.
* By my count, 11 House members did the same thing. Just one was a Republican (Dave Severin). The rest were Democrats who are either considered targets or think they are…
* Rep. Scott Drury voted “Yes” on the tax hike and “No” on the spending bill. Rep. David Harris voted for the tax hike, then didn’t vote on the approp bill. Rep. Michael McAuliffe voted against the tax hike, then didn’t vote on the spending bill.
Over the weekend the State of Illinois made concrete progress on reaching an agreement to break the two-year long budget impasse, according to Fitch Ratings. The state House of Representatives passed both spending and revenue measures with some bipartisan support in special session on Sunday. The tax increase legislation, an amendment to Senate Bill 9, would permanently raise the personal income tax rate to 4.95% and make other revenue enhancements. There is also apparent accord on significant budget reductions to align spending with expected revenues. The bills now return to the state Senate for concurrence, where a super-majority vote is required to raise taxes. The governor has threatened to veto the revenue increase although there appear to be sufficient votes to override the veto
Fitch downgraded Illinois’ rating to ‘BBB’ on Feb. 1, 2017 and maintained the rating on Rating Watch Negative. At that time, Fitch indicated that the Rating Watch would be resolved within six months based on an assessment of the state’s fiscal trajectory as it starts fiscal 2018 and that failure to enact a balanced budget for fiscal 2018 would result in a further downgrade.
Fitch will continue to monitor the developments in Illinois. Enacting a budget that sets the state on a path toward budgetary balance and provides a means to address the state’s accumulated budgetary liabilities would stabilize Illinois’ Issuer Default Rating and related ratings. Temporary or partial measures, or a failure to enact a budget within the context of this session, would result in a downgrade. The continuation of spending without sufficient revenues, particularly in light of the ongoing legal challenge to the state’s prioritization of other payments ahead of Medicaid payments, will increase liquidity pressure. The state risks losing full control of its budgetary decisions, which would be inconsistent with the current rating.
If there is no evidence-based model in place, the appropriations for K-12 aren’t any good.
They drafted the approp bill so that only an evidence based model can spend the appropriations.
The Illinois State Board of Education can’t distribute any money if an evidence-based model distribution formula isn’t passed.
So, the governor has to sign something or schools get no cash.
The Republicans have their own evidence-based model bill, but it’s not yet going anywhere and Speaker Madigan has repeatedly insisted that Rauner sign SB1, the Democrats’ school funding reform bill.
*** UPDATE *** I’m told by the governor’s office that should the Senate pass the tax hike bills the governor will take “immediate action” when it hits his desk. “So members shouldn’t plan to go anywhere.”
[ *** End Of Update *** ]
* Press release…
Governor Bruce Rauner today issued the following statement following the House of Representative’s passage of a 32 percent income tax hike without any reforms to grow the economy, create jobs, or provide property tax relief:
“When I took office, I promised the taxpayers of Illinois that I would fight every day to take this state in a new direction after decades of failed leadership from both parties. Today, Springfield has decided to give the people of Illinois the largest tax hike in history and continue out of balance budgets with no real reform.
“Under Speaker Madigan’s direction, legislators chose to double down on higher taxes while protecting the special interests and refusing to reform the status quo. It’s a repeat of the failed policies that created this financial crisis and caused jobs and taxpayers to flee.
“I will veto Mike Madigan’s permanent 32 percent tax hike. Illinois families don’t deserve to have more of their hard-earned money taken from them when the legislature has done little to restore confidence in government or grow jobs. Illinois families deserve more jobs, property tax relief and term limits. But tonight they got more of the same.
“For two and a half years we have been working to find common ground on a balanced budget. As recently as two days ago we believed that was possible.
“The legislature could have passed a no reform budget like this one two years ago. Instead, they allowed Mike Madigan to play his political games, passed phony budgets, racked up our debt and inflicted pain on the most vulnerable. All of this to force a permanent, 32 percent tax increase on Illinois families.
“Moving forward, this vote shows that if the legislature is willing to pass the largest tax hike in state history with no reforms, then we must engage citizens and redouble our efforts to change the state. “
*** UPDATE 1 *** Press release…
“Today, Democrats and Republicans stood together to take a crucial step toward reaching a compromise that ends the budget crisis by passing a fully funded state budget in a bipartisan way. While none could say this was an easy decision, it was the right decision; it’s clear that a budget package that cuts billions of dollars in state spending and also provides new revenue is the only path forward. I’m grateful legislators worked together to provide for our schools, protect medical care for the frail elderly, services for survivors of domestic abuse and others in great need.
“There is more work to be done, and we will continue working with Republicans to ensure the issues still on the table are fully resolved.”
*** UPDATE 2 *** House Republican Leader Jim Durkin…
“You have all heard the following statement: ‘it’s Déjà vu all over again.’ It has never been more true than today. What transpired is a repeat of the Illinois Democrats infamous temporary tax of 2011, with the only difference being today’s tax increase is permanent - yes, permanent. These votes confirm that the Illinois Democrats will never accept change and are only interested in the status quo – the status quo that placed Illinois in this squalid condition. The fight for Illinois families, workers and employers is not over.”
Except 15 of his own members voted for the bill today, unlike the 2011 tax hike when it was a purely Democratic vote.
*** UPDATE 3 *** Mayor Emanuel…
“I want to thank the host of Democrats and Republicans who came together tonight in bipartisan fashion to put the people of Illinois ahead of political party. This bipartisan budget is a major step forward to ending three years of inaction in Springfield. This bipartisan budget will prevent Illinois’ most vulnerable from losing their safety net, keep road projects active and keep people at work, ensure schools across the state open next month, and prevent Illinois from being downgraded to junk status. And this bipartisan budget will provide much needed stability to people in every corner of Illinois and from all walks of life.”
*** UPDATE 4 *** Press release…
Illinois Republican Party Chairman Tim Schneider released the following statement after the Illinois House of Representatives passed Speaker Mike Madigan’s permanent 32% tax hike without reforms:
“Today, Springfield politicians led by Speaker Mike Madigan voted to permanently raise taxes by 32% on the hard-working families of Illinois without passing property tax relief for homeowners, job-creating reforms, or term limits on politicians.
“Make no mistake about it - this historic vote was not the product of negotiation and compromise focused on pro-growth, citizen-empowering reforms. Last night, Madigan broke away from good faith budget negotiations with the intent of pushing his own plan to protect the broken status quo. Today, Madigan then introduced his massive 1,241-page tax-and-spend plan and gave lawmakers only hours to read, debate, and vote on the package.
“This 32% permanent tax increase, the largest in Illinois’ history, was the product of insider deal-making between special interests and entrenched politicians. Next year, voters will hold those politicians accountable for choosing Madigan over the people of Illinois.
“Now more than ever, Republicans across Illinois are standing with Governor Rauner and redoubling our efforts to end Madigan’s corrupt status quo.”
I don’t see how they can keep claiming this is the largest tax hike in Illinois history. 2011’s was larger.
*** UPDATE 6 *** Press release…
Comptroller Mendoza’s Statement on Sunday’s Budget Votes in the State House of Representatives
I want to thank all the members of the Illinois House of Representatives who courageously voted to step back from the fiscal disaster of the last two years and to take back their constitutional power of appropriation. In particular I want to thank the 15 Republican profiles in courage who were true heroes today, standing up for the people of Illinois and not for a Party of One.
We still have a long road ahead to a comprehensive budget plan to pay down our $15 billion backlog of unpaid bills that has tripled in the two years since Governor Rauner took office. I am disheartened but not surprised that he, as a Party of One, has announced that he will veto the bill. I hope that all the legislators who showed true courage on Sunday’s tough votes stay strong and steadfast in overriding his irresponsible veto.
Sunday’s vote sends a strong message to the financial markets that Illinois is serious about getting its fiscal house in order. I strongly encourage Republicans and Democrats in the state Senate to likewise forge ahead working together. Our office will continue working with members of the General Assembly to help in whatever capacity we can. When we come together in a bipartisan fashion, great things are possible for the state. Let’s keep this positive momentum going.
* The House passed an amended SB 9 tax hike bill on a vote of 72-45 today. 15 Republicans voted for the proposal. [Click here for the roll call.] The bill now heads to the Senate.
Several Republicans broke with the governor today. This bill was truly the result of a movement by the rank and file.
Reps. Andersson, Bryant, Cavaletto, Davidsmeyer, Fortner, Hammond, David Harris, Hays, Jimenez, Meier, Mitchell, Phillips, Pritchard, Reis and Unes all voted for the bill. Several of those members are also members of House GOP leadership.
The bill permanently raises the income tax rate to 4.95 percent. Gov. Rauner has opposed a permanent income tax hike if it’s not tied to a permanent property tax freeze. Brian Mackey hit the highlights of the bill on Twitter today. Click here for that.
* Quite a few of the members who spoke in favor of the proposal were Republicans. “This is the sword I’m willing to die on,” said Rep. Mike Unes (R-East Peoria). “If it costs me my seat, so be it”…
“Come tomorrow morning at the opening of business, if we don’t get this done, we will be the first state in the history of the United States of America to be in junk bond status.”
Rep. David Harris (R-Arlington Heights), who didn’t vote on the amendment, said during a thunderous speech that he wasn’t elected to the House to preside over the financial destruction of Illinois.
Rep. Jeanne Ives (R-Wheaton), who voted against the bill, insisted that the state’s economy was “too weak for a tax hike”…
The only people who are going to gain from this are the public sector unions … They are the only ones who are going to gain in this tax increase, not the hard-working people who live down the street from me and our small businessmen.
Another “Yes” vote, Rep. Terri Bryant (R-Murphysboro), described herself as being on the right and said “I hate taxes, I hate them.” But, she said, “As someone who’s on the right, who’s a fiscal conservative, we can’t have vendors, mom and pop places to be asked to do services for the state… and then after they perform those services say ‘Whoops, we don’t have the money to pay them’… and allow them to go into bankruptcy.
Bryant’s voice cracked at times, said she’s probably “get primaried” for her vote, but said, ” I don’t have to own what people did before I came here, but I do have to own what’s been done the past three years.”
Rep. Greg Harris, the bill’s Chicago Democratic sponsor, listed all of the calamities the state has survived, then asked as he closed debate: “If we defeat this bill tonight, will the state of Illinois survive us?”
* The bill now moves to the Senate for concurrence. The bill received 32 votes last May, which was two more than required at the time. But it’ll need 36 tomorrow when the Senate returns.
Sens. Tom Cullerton, Hastings, Stadelman and Morrison all voted “No” in May. Sen. Haine was absent and he’s not expected to be in Springfield tomorrow because he’s very ill. No Republicans voted for the proposal when it was last in the Senate.
* This post will likely be updated with reactions from various folks. Stay tuned.
*** UPDATE *** The ominibus appropriations bill just passed 81-34…
* Sun-Times: Illinois House approves income tax increase: With the state on the cusp of a catastrophic downgrade, the Illinois House on Sunday cleared the most controversial element of a budget package, a revenue measure that hikes the income tax rate to 4.95 percent to try to end a historic impasse.
* From the Illinois Policy Institute’s news service…
House Minority Leader Jim Durkin emerged from a Republican caucus meeting Sunday afternoon and said Democrats added a new amendment to their $36.5 billion spending bill.
Late Saturday, Speaker Michael Madigan announced a vote on a tax increase package would be held Sunday. But Durkin said that Republicans couldn’t put votes behind tax increases without knowing what’s in the spending plan.
“The Democrats made matters more complicated by filing a new spending bill within the last 15 minutes,” a visibly agitated Durkin said. “We have no idea what’s in it. To take a tax increase vote before knowing what you’re spending on, to me is irresponsible. As usual, we have not been advised what is in the new spending bill, and I think our caucus feels that is a sign of bad faith.”
Durkin said he wasn’t sure if Madigan would call the tax increase bill for a vote now or not. He said he spoke to Madigan this morning to see how the day would play out. it was “pretty brief.”
“The process gets extremely complicated and I will say it’s a step back in the negotiations on the reforms and bringing the impasse to an end,” Durkin said. “I want to do this in a fair, transparent manner. Today is not the day for it.”
* I checked in with Madigan’s spokesman Steve Brown, who said the amendment “reflects the discussions that the leaders and the budget/spending groups have been holding the past few days.” There have been “daily, multiple meetings,” he said.
Brown said he didn’t think it spent more than the omnibus appropriations amendment which passed Friday, but wasn’t sure.
* The House was about to start debating the new spending proposal (an amendment to SB 6), but the Republicans requested a one-hour caucus. They’ll be back by 4:40 this afternoon.
*** UPDATE *** I just spoke with Rep. Greg Harris, who is the House Democrats’ budget negotiator.
Rep. Harris said the newly filed amendment includes things like the Tier 3 pension savings the Republicans had asked for. It also increases the cuts in higher education from the House Democrats’ 5 percent to the Republicans’ preferred 10 percent. It does spend more on some stuff, like $15 million for the Department of Corrections.
Harris insisted that everything in the new amendment is identical to what the budget negotiators had agreed to. He said he didn’t know why Leader Durkin wasn’t briefed, but that Durkin would “know that it had to be filed.”
According to Harris, the new amendment spends $36.054 billion, compared to Friday’s spending plan which spent $36.449 billion. So the new amendment, according to Harris, spends $395 million less than the one which was adopted with an overwhelming bipartisan majority a few days ago.
* A Democratic staffer pal of mine texted me: “I’ve done more mental health checks today than a DHS worker.”
I lol’d back and asked how things were going. The reply…
In its most simplistic terms, people just need to stop, breathe, and make decisions. We don’t have time to build a new spaceship; we just need to keep this one from exploding.
The Republicans control the executive branch, they can cut or eliminate whatever they want, mostly without legislative approval to do so. The fact that they haven’t is pretty strong evidence that this is just empty rhetoric.
That’s not really true. A lot of cuts require changes in statutes. And as we’ve seen time and time again during this “automatic pilot” era of state spending, judges exert immense control over what the state can and cannot do without a budget.
* But here’s something I wrote this morning for subscribers that wound up getting cut for space…
The single biggest mistake made by the governor over the past five or six weeks was pulling Senate Republican votes off the budget implementation bill that the Senate Republicans had negotiated with the Democrats.
The Democrats fell three votes shy of passing that BIMP bill on their own because it cut so much (particularly out of Medicaid) and the more liberal rank and file members wouldn’t abide passing a bill designed to attract Republican votes without actual Republican votes.
Had the governor not pulled Republican votes off that bill and it had passed, the current situation would be totally different. It would now be the three tops and the governor against Madigan on spending. Now, the spending negotiations are a purely partisan divide at the leadership level.
The bipartisan Senate bills (including the BIMP) reduced spending by $3.761 billion. When the Republicans wouldn’t/couldn’t vote for all the bills they’d negotiated, the Senate Dems passed a package of legislation that reduced spending by $3.032 billion. The Republican “Capitol Compromise” proposal would reduce spending by $4.012 billion (plus a ridiculous non-cut budgetary gimmick of $1.178 billion that I explained to subscribers several days ago).
Traditionally, the 4th of July weekend is reserved for family, fun, and festivals. But Representative Allen Skillicorn (R-Dundee) says Illinoisans have been without a budget for over 24 months, the 2017 financial year ended June 30th, and the state is on the brink of a credit downgrade.
“The politicians who haven’t done their jobs need to stay in Springfield and pass a balanced budget that avoids tax hikes. The current scheme from Speaker Madigan includes massive tax hikes and does absolutely nothing to curb spending or reign in Illinois’ deep structural problems. Illinois has been drowning from inefficient and wasteful bureaucracy, high taxes, and public corruption for the past 30 years,” said Skillicorn.
Representative Skillicorn has voluntarily waived his per diem and travel pay for the entirety of the special session. Skillicorn had planned to take part in the Crystal Lake Parade on Sunday, but instead will stay in Springfield to pass his Right Now balanced budget with no tax hikes.
Skillicorn says, “My top priority is to pass a balanced budget with reforms not unneeded tax hikes. The people deserve legislators that get the job done. I will continue working on my Right Now budget and will stay in Springfield over the weekend to be a part of the solution!”
We have been informed that we will be voting on a revenue bill today. As I have been saying for the last two years it is impossible to cut our way to a balanced budget. Additional revenue is necessary. Anyone who thinks differently is just wrong. While no one likes to pay taxes and certainly not more taxes, the reality is that sometimes it is necessary. I have done my best to communicate this to the people in the 77th district. Only with an income tax increase will we be able to care of our seniors, care for people with special needs, provide early intervention in schools, repair our aging infrastructure, fund our state universities, feed our needy, provide healthcare for lower income families and once again be proud of our state.
That raises the question: What is the real deadline for the Legislature to approve a budget and stave off further financial disaster, now that the June 30 deadline has passed and the state has entered its third consecutive year without a real budget?
The real deadline, if there is one, exists only in the minds of two people, Gov. Bruce Rauner and House Speaker Michael Madigan, who don’t want the rest of us to know what it is because it might weaken their negotiating position.
I personally would think it is 8 a.m. Wednesday, July 5, the day after the holiday, when Wall Street gets back to business.
That would seem to be the earliest the bond rating agencies would lower the boom on Illinois and throw the state into junk bond status over its incompetent governance.
The ratings agencies had threatened to reassess the state’s bond rating as early as Saturday, and there’s nothing that says they will wait, but the betting around here is that the long holiday weekend provides a little more time.
If there’s no real progress demonstrated today, all heck might break loose in New York tomorrow, even though the ratings agencies are closed. We’ll see.
The fact that state Sen. BILL BRADY, R-Bloomington, will bring a downstate voice to top General Assembly leadership is being welcomed by some of his colleagues. […]
“People from downstate bring a different perspective to the legislative process,” said Rep. TIM BUTLER, R-Springfield, whose 87th House District is part of Brady’s 44th Senate District. […]
“I’m personally not one that denigrates Cook County and the city of Chicago,” Butler said. “I try very hard not to. I think the city itself is a wonderful city. … I would like to see some of the politics of Cook County change, but obviously, Chicago is a vital part of our state.”
Rep. SARA WOJCICKI JIMENEZ, R-Leland Grove, who represents some parts of Springfield that Brady does not, said she has always looked up to Radogno and considers her courageous. But with her leaving, Jimenez said, she thinks Brady’s ascension to leadership “could be great for us here in Sangamon County.” She said he is “someone who lives not too far from us in Springfield and has a lot of the same issues and concerns that we do.”
Brady is the first truly Downstate legislative leader since Frank Watson led the Senate GOP Caucus (Tom Cross was from exurbia). Watson retired in 2009. And like Radogno before him, Brady is the only legislative leader who isn’t an attorney.
* But there’s something else to consider that a friend pointed out to me yesterday. All four legislative leaders are now white, male, financially well-off Irish-Americans.
Several Senate Democrats were holding an upbeat news conference about progress being made in talks when Madigan’s statement about the [Sunday] tax hike vote was issued. None of them knew it was coming. Just before its release, Sen. Heather Steans, D-Chicago, one of the Democrats’ budget negotiators, said, “We think we are really about nailed down now on all of the numbers for the budget and revenue side of this.”
If you missed that Madigan press release, click here.
* Sen. Toi Hutchinson looked stunned when a reporter read Madigan’s press release aloud to the gathered Senate Democrats…
State Sen. Toi Hutchinson, D-Olympia Fields, was surprised to hear the “revenue package” would be called. Hutchinson, who sponsored the Senate’s revenue bill, said it shows the “fluidity” of budget talks.
Hutchinson said recent negotiations about the revenue bill weren’t about elements in the measure but more about what Republicans wanted passed before they could declare support for an income tax hike.
“What we’re going to end up seeing when there’s final votes on this is that you will see Democrats who refuse to vote on revenue, and you’ll see some Republicans who change their minds,” Hutchinson said. “It’s going to be one of those situations where people are voting based on their districts and based on what they believe is the right course of action moving forward.”
[Madigan spokesman Steve Brown] said the “revenue package” is “the one that the Republicans endorsed.”
“It could be modeled on that,” Brown said. “There may be some changes.”
Top Republicans last month offered up a “compromise” budget plan, which included a four-year property tax freeze. While it assumed an income tax hike, Republicans never filed a revenue bill.
The “changes” reportedly include a permanent income tax hike, which the governor opposes.
The move by Madigan to call a vote without Republicans on board sets him up to collect ammunition against the opposition party, as he will be able to point to people who supported the spending plan on Friday but voted Sunday against the tax hike and accuse them of wanting to spend money without paying for it.
House Democrats who could be Republican targets in next year’s election also could vote against the tax hike in an attempt to inoculate themselves from Rauner-funded GOP attack ads.
Asked why Democrats would call the tax bill without a broader agreement with Republicans, [Rep. Lou Lang] said, “This cannot go on forever.
“There are members of Mr. Durkin’s caucus who are ready, willing and able to vote on a bill, and they want to do it right away, so we are going to oblige them,” he said.
I think members have told the Speaker that a number of Republicans are prepared to vote for the revenue bill.
* And from the Illinois Policy Institute’s Facebook page…
UPDATE: Our sources tell us there are two Illinois Republicans in the House who are confirmed “yes” votes on the $5 billion tax hike.
Rep. Sara Wojcicki Jimenez
Ph. (217) 782-xxx
xxxx@ilhousegop.org
Rep. Steven Andersson (Citizens for Steve Andersson)
Ph. (630) xxxxxxx
xxx@xxxxx
Andersson is apparently encouraging his colleagues in the House to join him in voting for Madigan’s tax hike.
Please contact both of these lawmakers and tell them to vote “NO” on the $5 billion tax hike.
The vote is expected to take place Sunday at 2 p.m.
The comments are quite something. And as subscribers know, it’s more than two Republicans.
* Rep. Andersson posted a photo of himself on Facebook last night having dinner with his wife. Check out a couple of the comments…
You are Madigan’s Toady. Switch parties traitor.
You are selling your soul to the devil. This tax increase will only drive more people out of this state. In fact we are prepared to relocate our entire family, not just my household, entire family. Hang your head low sir, you deserve it!!!!!!
*** UPDATE *** Rep. Steve Andersson responds to the Illinois Policy Institute Facebook post…
Rich,
Saw your post. FYI, there are 69 comments to the moment. A few supportive, mostly negative, some very offensive. But what’s far worse is that someone or some group has given out my personal cell phone number. Those calls and texts are about as nasty as you can imagine. Came in all night and day.
