 The state has been dealing with a multibillion-dollar deficit, but
the amount
is not certain. According to the legislative Commission
on Government Forecasting and Accountability, when the current
fiscal year ends June 30, the state will have $1.9 billion more than
what was assumed in the current budget.
That number might be even higher next fiscal year, according to
Jim Muschinske, revenue manager for COGFA. He said at a hearing
Thursday that the state should pull in $34.9 billion in general
revenue for fiscal 2012.
A bigger paycheck at the end of the current fiscal year in June,
along with the possibility of a similar situation occurring next
year might be a win for the state, but it also creates a problem in
state Rep. Michael Tryon's mind.
At the end of the current fiscal year, the state will be about $6
billion behind on bills. Gov. Pat Quinn has a borrowing plan to pay
off the overdue bills, but it has stalled in the Legislature. Tryon
said there are options beyond Quinn's plan.
"We're going to be looking for cuts, and if we're looking at cuts
and the revenue is really $1 billion or $800 million more, it'd be
significant," the Crystal Lake Republican said.
Having more money means fewer cuts, and it might save some
people's jobs, according to Tryon.
COGFA's predication is more critical now than in years past
because of new legislation capping how much the state can spend and
requiring the budget to be based on the state's income instead of
spending wants.
Quinn's proposed budget for fiscal 2012 comes in at $35.4
billion, well below the cap, but above the $33.9 billion Quinn's
office is predicting in general revenue. However, the state House of
Representatives is more pessimistic than the governor. It is basing
its fiscal 2012 budget on expected income of $33.2 billion.
The difference between the numbers comes from how much each
entity believes the state's tax base will grow and how much money
will be generated by a recent personal income tax hike. Lawmakers
increased the personal income tax by 67 percent in January.
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Muschinske called both Quinn's and the House's forecasts
conservative, but not wrong simply because they differed from
COGFA's $34.9 billion projection for fiscal 2012.
"When we come up with our forecast, we're not governed by 'you
need to have a very conservative forecast; you need to have a very
optimistic forecast,'' he said. "We're governed by 'What's your best
forecast?' That's what we presented today."
Even COGFA's estimates are based on a smaller rate of growth than
average for the past 15 years, according to Muschinske.
"And that takes into account two recessions," he added.
A 67 percent personal income tax increase and an economy groggily
waking up from the recession should prop up the state's sagging
financial standing for now, according to Edward Boss Jr., chief
economist for COGFA.
The nation and state are still dealing with the hangover left by
the recession.
"The unemployment rate has improved and lowered; however, a large
part of that is probably from discouraged workers that aren't in the
labor force and aren't even looking," Boss said. "That's a problem
that, together with housing, have been the major drags on keeping
this economic recovery well below what has historically been the
case."
[Illinois
Statehouse News; By ANDREW THOMASON]
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