Illinois Governor Angles for More Borrowing, Higher Taxes

Published April 18, 2010

Illinois Governor Pat Quinn (D) has proposed a budget that would borrow billions of dollars in fiscal year 2011, continuing the state’s eight-year trend of increased borrowing, and would still leave the state with an $11 budget deficit according to estimates by the governor’s office.

Political leaders in the state General Assembly remain steadfast in their opposition to higher income and sales taxes.

The governor calls for a $51.7 billion operating budget, which includes general revenue funds (47 percent), federal transfers, highway funds, special state funds, and other items.

Swipe at Education
Quinn’s budget includes more than $2 billion in spending cuts, most falling on public education, designated for a 17 percent cut. Quinn aides estimate approximately 13,000 teachers would lose their jobs as a result.

Prescription drug assistance to seniors was also on the chopping block, along with social services for indigents.

Income Tax Surcharge
The cuts are largely viewed as a gambit by the governor, a threat designed to build support for an income tax increase.

During his budget speech, but not part of the budget proposal he submitted, Quinn proposed a one percentage-point temporary surcharge on the state income tax. Illinois has a flat 3 percent personal income tax, and Quinn’s proposal would raise the rate by one-third. He did not give a date for the expiration of the surcharge.

Ostensibly, the surcharge would be used to restore revenue otherwise cut from education and social services.

The proposal was widely panned and is not expected to survive the spring session.

Bipartisan Backlash
“Let’s be straightforward about this,” said Illinois House Speaker Michael Madigan (D-Chicago.) “The people of Illinois, they don’t want tax increases. They’re hurting. The American economy is in bad shape. People are out of work. They don’t want to hear about tax increases.”

Republican leaders were likewise quick to condemn the budget.

“I don’t think it’s going to work to bring private-sector jobs to increase taxes on families 33 percent,” said State Sen. Bill Brady (R-Bloomington), the Republican gubernatorial nominee challenging Quinn this fall. “It’s not going to work to bring business investment back to this state and jobs when you send a message that we’re not going to solve our fiscal crisis, we’re going to try to borrow our way out of it.”

Senate Republican Leader Christine Radogno (R-Lemont) was equally upset by the governor’s address.

“We saw a speech that was short in many ways,” she said. “It was short time-wise, short on specifics, short on ideas, and, in general, short on leadership at a time when we desperately need some.”

Greg Blankenship ([email protected]) is founder and president of the Illinois Alliance for Growth and founder of the Illinois Policy Institute, a state-based think tank.