Senate Democrats passed their version of the budget shortly before 1
a.m. on Friday, while the Illinois House has yet to debate a similar
proposal backed by Democratic lawmakers.
The state's next fiscal
year begins on July 1, and the state is prepared to adopt an
unbalanced budget that would be billions of dollars in the red.
Lawmakers have been grappling with a $13 budget deficit since the
start of the legislative session in January and have set Friday as
the adjournment date.
One of the critical components of the proposed budget is a
delayed payment to the state's public employee retirement systems.
Democrats want to wait until at least Jan. 31 to make a contribution
of at least $3.7 billion.
David Vaught, director of Gov. Pat Quinn's Office of Management
and Budget, said the state could not immediately afford to make a
pension contribution. But he was insistent that the state would be
able to find the money down the line.
"No cash means that (pensions) won't get paid," he said. "It's
funny money. It's motley money when you don't have cash and you're
trying to say you're going to pay it anyway. So let's get real here.
We're out of money."
State Sen. Dave Syverson, R-Rockford, said state government would
have to take billions of dollars from state programs and agencies to
even consider making the pension payment.
"I don't know where they come up with that in six months. But
they just said in six months they will find $3.7 billion to make a
payment. Unfortunately, it's laughable because no one really
believes what they're saying," he said.
Syverson noted that if state government waited to make a pension
payment in January, interest would have to be added, costing the
state millions of dollars more.
Lawmakers have struggled in recent years to make the state's
annual contribution to its five public employee pension systems
covering state workers, downstate teachers, state university faculty
and staff, lawmakers, and judges. Illinois' pension systems have the
highest collective unfunded liability in the nation at $80 billion,
according to the national think tank Pew Center for the States.
Last year, lawmakers agreed to borrow billions of dollars to make
the yearly payment. This year, House lawmakers showed less support
for a similar proposal.
The struggles with pension payments come on the heels of a reform
plan passed by lawmakers and approved by Quinn weeks ago that
established reduced benefits for incoming employees.
At the time, Quinn said the "two-tiered" pension system would
save the state billions of dollars over the course of several years.
The major cost-cutting proposal Democrats are calling for in
their proposed budget is an across-the-board 5 percent reduction in
the state's payroll.
But Republican lawmakers claim the measure is nowhere near
sufficient to bridge the budget shortfall and are calling for much
greater spending cuts.
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Syverson said Democrats had ulterior motives at work.
"They're planting bombs. They're overspending intentionally
because they know that, and pretty confident that, (GOP nominee)
Bill Brady is going to win the governorship," he said. "So they're
creating a huge budget hole and they're not funding the pension
system, so in January there could be a budget hole from really $6
(billion) to $10 billion. And then they're going to give that to
Brady and say that, ‘You solve it, but we're not going to help
State Sen. Bill Brady, R-Bloomington, will face Quinn in
November's general election for the state's highest office.
Perhaps adding to the political pressure on the governor, the
Democrats' budget proposal would take the rare step of granting
Quinn extraordinary budgetary powers for the upcoming fiscal year.
State Rep. Barbara Flynn Currie, D-Chicago, said emergency powers
would help Quinn manage the budget during a difficult economic time
for the state.
"When it comes to the agency he manages, when it comes to higher
education, he's in a position under this proposal to reserve dollars
we have appropriated in case he needs some flexibility," she said.
Currie added that Quinn would be able to cap participation in a
state program if funding fell short.
In the state's history, the General Assembly has approved of
emergency budget powers for one other governor, Republican Gov. Jim
Friday could see Democrats introducing revisions to their budget
While the House Democrats' and Senate Democrats' budget plans are
mostly similar, there are some revenue measures within the plans
State Sen. Donne Trotter, D-Chicago, the Senate Democrats'
primary budget negotiator, said a number of revenue-generating
provisions in the Senate proposal have yet to be considered,
including a tax hike on cigarettes, a tax amnesty program and a
front-loading of funds from tobacco securitization.
"None of this is guaranteed to pass because it has to go through
the other chamber (the Illinois House)," Trotter said. "We don't
know what is coming out of that chamber. I've not seen their bill. I
don't know if they've see ours either."
The Illinois House could consider their own budget proposal or
the proposal passed by Senate.
Statehouse News; By KEVIN LEE]