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Unexpected revenues for schools?

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Illinois

* Will newfound money patch the budget hole? Maybe…

Democratic Gov. Pat Quinn suggested Tuesday that better-than-expected sales-tax collections could be used to plug a hole in state school funding this year.

The budget that lawmakers and Quinn approved is about $230 million short for schools, and state education officials said Monday that they would likely not be able to make the final aid payment to school districts during the second half of June. The Illinois State Board of Education warned that a similar payment scheduled for the first half of June also will fall short.

Asked about the situation Tuesday, Quinn said he believed the money could be found within the already strapped budget because sales tax revenues are up. From July through December, Illinois brought in $4.312 billion in sales tax revenue — $239.1 million more than the same period the year before and $139.8 million more than initially projected, according to the Department of Revenue. […]

The governor added that he’d like to look at closing so-called “tax loopholes” to help the state make school aid payments next year, which could be more than $400 million short under a budget plan Quinn proposed last week.

Look, here’s the thing. School funding is remaining level for next fiscal year. But because of increased costs, etc. the per pupil funding level will be less. With the rest of the budget taking big hits and billions of dollars in overdue bills to struggling vendors, does it make sense to spend more money on schools? If you’re pro-school, you’ll say yes. Others might say no. But this does need to be honestly debated.

Also, closing tax loopholes to fund schools? Man, he must want to close a whole lot of loopholes because he used his recent budget address to outline some pretty big plans for that cash, and they didn’t include school funding…

That’s why I have instructed my Revenue Director, Brian Hamer, to meet with legislative leaders of both houses and both parties to identify and close unnecessary loopholes.

Part of the loophole revenue can be used to provide targeted tax relief for hard-working families and businesses across Illinois.

By taking on the loophole lobby, we can find the revenue to permanently abolish the natural gas utility tax. […]

Why not a moratorium on unfair loopholes in the tax code as an important way to pay the bills faster?

* Meanwhile, Illinois Statehouse News has a story about some of Gov. Quinn’s proposed budget cuts…

Funding for domestic violence shelters in Quinn’s budget would be cut by $2.3 million, from $18.8 million this year to $16.5 million.

Cutting aid to these shelters is like cutting funding to a local fire department, because people never know when they will need their help, said Vicky Smith, executive director for Illinois Commission Against Domestic Violence, a nonprofit that works against the abuse of women and children.

“They are emergency crisis-intervention services and need to be available when people need the assistance,” Smith said. Quinn’s cuts are “not good. This is a very, very high risk population that needs help immediately.”

In Illinois, there are 63 domestic violence shelters, and the proposed funding cut would shrink that number, Smith said.

Quinn’s budget also zeros out funding for youth substance and alcoholism abuse from the Illinois Department of Human Services’ Division of Family and Community budget.

Eliminating the $2.6 million in prevention funding would cut services to more than 34,000 children, but it would be more than just the children affected, said Eric Foster, chief operating officer for the Illinois Alcoholism and Drug Dependence Association, a nonprofit lobbying group that represents drug and alcohol abuse centers statewide.

“Substance abuse prevention services affect every single aspect of the state — health care, law enforcement corrections, the courts,” Foster said.

* Related…

* An Alternative Solution To The Illinois Budget Crisis: The Center for Tax and Budget Accountability released a report today touting the benefits of a graduated income tax. This is compared to the status quo where all residents – from Derrick Rose to your neighbor – pay five percent of their yearly income to the state.

* Quinn: Public safety a top priority with prison closures

* Hospital deal appears unlikely before Thursday deadline

* Hospitals ready if talks break down on taxes

* Home health care workers protest proposed Illinois budget cuts

* More staff cuts ahead for Plainfield schools

* Sandack says no hopes emerge from Quinn’s budget

posted by Rich Miller
Wednesday, Feb 29, 12 @ 11:46 am

Comments

The CTBA graduated income tax would reduce taxes for 94%, while boosting revenues and basing taxes on ability to pay. I’ll bet that amendment would get voter approval if the General Assembly ever put it on the ballot.

Comment by reformer Wednesday, Feb 29, 12 @ 11:55 am
Beginning to wonder if PQ’s “plan” essentially amounts to:
- throw something out there
- “read and react” to the public tone
- shift & support whatever maximizes your popularity in the end. Not just occasionally. All the time.
- everything else is just details

Exhibit A:
- Speech: Close those loopholes to provide targeted tax relief and abolish the natural gas tax. This is my plan! I’ve thought about it long and hard.

- Few days later: Wait a minute, never mind what I said in my speech. Education! Yes sir, education. That’s more important. Close those loopholes to help education. That’s the ticket!

- Next week: ?

Don’t get me wrong. Education is vital. It is important they find these funds somewhere.

PQ simply reminds me of a golfer licking his finger, sticking it in the air and trying to get a read on the wind direction.

Constantly.

Comment by Shock & Awww(e) Wednesday, Feb 29, 12 @ 12:05 pm
Any “found” money should be used to pay overdue bills.

Comment by Aldyth Wednesday, Feb 29, 12 @ 12:16 pm
Amen to Aldyth. Why must new money go to new programs? Pay your bills first! I know many a social service agency that would love to receive some of what they are owed.

Or, at a minimum, use it to buy down the school pension obligation.

Comment by anon sequitor Wednesday, Feb 29, 12 @ 1:20 pm
Pay………….your………….bills.

Comment by Old Milwaukee Wednesday, Feb 29, 12 @ 1:23 pm
Agreed. Pay the bills. As for the substance abuse programs—that’s nice, but Alcoholics Anonynous, NA, etc. is the gold standard. And it’s free.

Comment by John Galt Wednesday, Feb 29, 12 @ 1:59 pm
With the state funding mechanisms as broken as they clearly are–I think it is time to seriously consider a graduated tax structure. I attended a presentation for non profit orgs trying to stay in business while providing human services this morning. Ralph Martire presented his view of state finances. We all agree our system is broken and nothing currently on the table is likely to fix it.
It’s time to start taxing services, generating more revenue through a graduated income tax structure and to fix an education system that is failing generations of children and ensuring that Illinois stays near the bottom of list on new industry and jobs. Time to stop blaming teachers and state employees for taking pensions when it was clearly a failure of elected leadership that has bankrupted this state with policies put in place 30 years ago and designed to land us on the rocks. Everyone who allowed these policies to go forward without anticipating this ‘payday’ is accountable—Time to face it and fix it.

Comment by Illinoyed Wednesday, Feb 29, 12 @ 2:17 pm
Has Martire or CTBA ever advocated for a single budget cut?

Everything I’ve read from them over the past 5 years or so involves increasing taxes - going back well before even the gross receipts tax idea.

It’s like clockwork. Another budget cycle? Oh goody, when does the latest CTBA tax increase white paper come out? Can’t wait!

They do some good work and have tons of data, but it’s the same drum beat over and over and over and over and over.

It reduces their credibility and effectiveness knowing their proposed solution to any challenge IL faces is simply “More revenue, please”.

Comment by Shock & Awww(e) Wednesday, Feb 29, 12 @ 2:26 pm
Hello….earth to the Governor…the extra money that has come in has already been spent on paying bills…..and you still have an $8B hole. Its not like the money has been sitting in a safe somewhere and now you can pop it out and spend it.

Comment by Raising Kane Wednesday, Feb 29, 12 @ 2:36 pm
Those loopholes should definitely be closed. Some of them are ridiculous. But getting the GA to pass those loophole closings has not been possible in any of the years that I’ve tried to do it…

Comment by soccermom Wednesday, Feb 29, 12 @ 2:38 pm
They’ll fight it as long as they can, but the state constitution needs to be amended. Graduated income tax. Means testing for public schools to try and staunch home value killing school property taxes. Likely? Not in this millenium. The sanctification of government employee pensions in the state constitution will never be jeopordized.

Comment by Cook County Commoner Wednesday, Feb 29, 12 @ 3:03 pm
S & A: “Has Martire or CTBA ever advocated for a single budget cut? Everything I’ve read from them over the past 5 years or so involves increasing taxes … .”

S & A, Suggest you go to CTBA webpage and take a look at their Directors. That they should advocate for more taxes is about as surprising as the CTU being opposed to working a longer school day.

Comment by Anon III Wednesday, Feb 29, 12 @ 3:51 pm
==Quinn’s budget also zeros out funding for youth substance and alcoholism abuse from the Illinois Department of Human Services’ Division of Family and Community budget.==

Typical bleeding heart liberal Chicago Democrat.

Comment by wordslinger Wednesday, Feb 29, 12 @ 4:30 pm
S&A
The CTBA graduated tax contains a tax cut for 94% of residents. I realize that’s not 100%, but most of us who aren’t in the top 6% would appreciate the tax cut.

Comment by reformer Wednesday, Feb 29, 12 @ 4:33 pm
Finance Committee hearings on the balanced budget amendment (HJRCA 12) are scheduled for tomorrow morning. To be on the ballot this fall would need to be approved by the General Assembly by May 6 (passage required 6 months before the general election). That would be warp speed, but in the age of electronic social networks it might be possible to generate enough pressure, if the 94% go into action. Maybe even some of the 6% would emulate Warren Buffett and support it too.

Comment by jake Wednesday, Feb 29, 12 @ 4:57 pm
I am a member of the CTBA Board of Directors. I joined the Board shortly after I retired as a member Of Governor Ryan’s Cabinet. I joined because I believed that CTBA was the best informed and most articulate advocate of the income tax increase I knew the state badly needed.

I have been a steadfast advocate for the past several years that the state needed a combination of revenue increases and spending cuts to balance the budget. Not all Board members agree with me. They can speak for themselves.

The CTBA staff does first class research. The reports they produce are, in my opinion, above reproach as to their integrity and quality.

Comment by steve schnorf Wednesday, Feb 29, 12 @ 5:31 pm
john galt: AlAnon is not ‘free’. http://dynamodata.fdncenter.org/990s/990search/esearch.php

Somebody(don’t know who, and don’t care to spend the time finding out) is providing funds to run all the chapters of alcoholics anonymous - it ain’t free.

Comment by jerry 101 Wednesday, Feb 29, 12 @ 6:25 pm
If you increase taxes on the super rich they will just move out of state. Gary will become the new Hamptons.

Comment by wishbone Wednesday, Feb 29, 12 @ 8:33 pm
To wishbone: Moving to Indiana is not a slam dunk for lower taxes. State income tax is lower than ours (3.4%) but counties can levy an additional income tax, and several do. Also, pensions (except for Social Security) are fully taxed as income in Indiana, but are tax-exempt in Illinois. I would definitely not uproot my life to move to Indiana for lower taxes, at any income level.

Comment by jake Thursday, Mar 1, 12 @ 10:35 am