Illinois Democrats offer FY 2016 budget with cuts, revenue

[May 26, 2015]  CHICAGO (Reuters) - Democrats in the Illinois state legislature will move ahead with their own fiscal 2016 budget that includes spending cuts as well as new revenue that will be "responsive to the needs of the people in the state," House Speaker Michael Madigan said on Monday.

He added that Democrats, who control both the House and the Senate, do not have the approximately $3 billion in revenue needed to balance their $36.3 billion general funds budget.

"We're willing to work with the governor to find the money to pay for it," Madigan, a Democrat, told reporters in the state capitol in Springfield.

Republican Governor Bruce Rauner proposed a $32 billion budget in February that included no new revenue, relying instead on $6.6 billion in spending cuts with a third coming from his plan to freeze worker pensions and move retirement benefits earned in the future into a less-generous program.

Madigan said that move was reckless, particularly in light of the Illinois Supreme Court's sweeping ruling earlier this month that public sector workers have iron-clad protection in the state constitution against pension cuts. He added that the governor has not revised his budget to replace the $2.2 billion in pension contribution savings.

Illinois has the worst-funded pension system and lowest credit ratings among the 50 states.

Shortly before Madigan's press conference, a Rauner spokesman issued a statement that said the speaker and "politicians he controls" had walked away from negotiations on "critical reforms" sought by the governor. Those reforms include right-to-work zones and tort reform.

Madigan, whose chamber has voted down a few of Rauner's proposals, said it was not "appropriate" to bring non-budget issues into budget talks.

The is clock ticking toward the May 31 legislative adjournment date. If a budget is not passed by then, budget bills would need a three-fifths voter in each chamber for passage. Illinois' fiscal 2016 begins on July 1.

Madigan said the Democrats' spending plan will boost funding for education, corrections and pensions, while cutting some other areas of state government.

House Republican Leader Jim Durkin said "House Democrats affirmed today that they don't want to pass reforms that will fix a broken state government, but only want to raise taxes."

(Reporting by Karen Pierog, editing by G Crosse)

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