VERY LITTLE TARGETED TO PAY BILLS
The Democrats’ 67 percent income tax increase in 2011 was touted as a way to pay off the state’s overdue obligations; however, Governor Quinn’s budget plan spends 99.5 percent of every dollar the state is anticipated to collect in the coming year, setting aside just $160 million to pay off the state’s old bills.
Unless Illinois brings spending under control, the backlog could reach $35 billion in just five years—approximately $2 billion more than the state’s entire annual general fund budget.
FEW DETAILS OFFERED
Echoing the outline his budget office released in January, Governor Quinn proposed a freeze to almost all state spending, including the big-ticket items of healthcare, welfare and education.
The goals are admirable, but the budget plan offered little detail on how to achieve those goals.
Governor Quinn’s budget proposal did include a $2.7 billion Medicaid cut, but he did not offer details on how to achieve those savings. And, based on the Governor’s proposal, the state would still end Fiscal Year 2013 with a $4.5 billion Medicaid bill backlog. Serious changes must be made to curtail liabilities, but lacking significant reforms, the state is on track to see a $21 billion Medicaid backlog within five years.
Despite a target of reducing Medicaid spending by $2.7 billion, the proposed budget would actually see a record three million people enrolled in the Medicaid program—an increase of more than 150,000 people this year.
The Governor also did not offer details or a specific pension reform plan, other than his previously announced suggestion to shift costs to property taxes. His budget did assume that $160 million in unclaimed property would be used to help pay the state’s $5.25 billion pension obligation next year.
PENSION WORKING GROUP TO LOOK AT REFORMS
I am a member of a pension working group that has been meeting for several weeks with the Governor’s office. We have a goal of submitting an outline of reforms to the Governor by April 17, as per his request.
I also met with representatives this week of several Illinois Chambers of Commerce – the McLean County Chamber of Commerce, the Lincoln/Logan County Chamber of Commerce, Peoria Chamber of Commerce, Champaign Chamber of Commerce and the Naperville Chamber of Commerce – to listen to their concerns and get their ideas about pension reform.
MORE MONEY FOR EDUCATION
Governor Quinn asked to add $32 million to state education spending, but the largest portion of that—$20 million—would be for early childhood education, rather than traditional classrooms. In fact, the traditional per-pupil allocations under the state’s general state aid formula and mandated categorical programs would decrease.
Other specialized programs would see large increases, such as a 200 percent hike in special grants to schools that perform poorly. At the same time, the Governor’s plan would require local governments to assume the cost of the State’s Regional Offices of Education through the personal property replacement tax.
CLOSING STATE FACILITIES
The proposed budget also advances closure of several state facilities, including eight Department of Corrections’ closures. The Governor proposed closing prisons in Tamms and Dwight and shuttering six adult transitional facilities in Peoria, Decatur, Aurora, Carbondale and two in Chicago.
The Governor previously announced plans to close the Jacksonville Developmental Center and Tinley Park Mental Health Center. In the new budget, he would also shut down the Singer Mental Health Center in Rockford and Murray Developmental Center in Centralia.
He also proposed closing juvenile justice facilities in Joliet and Murphysboro, a Department of Agriculture lab in Centralia, a forensics lab in Carbondale, 24 local Department of Human Services’ offices, 16 state police communications centers and four state garages.
SLASHING ROAD PROGRAM
Of note, the budget would slash the state annual Road Program, reducing it by half to $1.5 billion. The Road Program for the coming year would be the smallest since Fiscal Year 1999.
Details of the program, which is funded through dedicated revenues, are scheduled to be released in April.
I am working with the State Auditor General to take an in-depth look at how those revenues have been spent by the state over the past several years.