Illinois Senate finally passes budget bills, but ‘Grand Bargain’ is history

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ILLINOIS CAPITOL

By CARL GREEN
Illinois Correspondent

Springfield, IL – Illinois legislators have lurched toward pressuring Governor Bruce Rauner to agree to a budget, losing all semblance of a “Grand Bargain” bipartisan effort as Senate Republicans chose to sit out the process altogether.

The Senate passed several bills that were originally intended to be linked, requiring that they all pass before becoming law in the so-called bargain. However, that requirement has been dropped.

The biggest bill was an income tax increase to 4.95 percent, passed May 22 on a 32-26 vote, which would be retroactive to Jan. 1. Sharp-penciled observers quickly noted that it meant Illinois earners would in essence pay 5.81 percent on income for the rest of this year. The rate had been reduced from five percent to 3.75 percent in 2015.

The bill also would increase the corporate tax rate to seven percent, from 5.25 percent, to generate revenue to fund the state government and begin to pay off a monumental backlog of bills.

MANAR: PLAN MEETS CRITERIA

A southwestern Illinois senator, Andy Manar of nearby Bunker Hill, helped present the bills for vote and issued a statement that Rauner should agree to the plan because it meets all the criteria he had specified.

“This is a balanced, full-year budget with no new spending and $3 billion in cuts to government programs,” Manar said. “Just as important, it lives within the governor’s recommended spending level outlined in the Fiscal Year 2018 budget he proposed in February.”

But it will lack one key ingredient that Senate Democrats had tried hard to add to the budget stew – support from Republican senators. The Republicans kept claiming they were close to reaching agreement on a budget but just needed more time for more talk.

With the end of the session looming at month’s end, Senate President John Cullerton finally decided to move ahead without the Republicans. He didn’t say Republicans were stalling, like Lucy with the football in Peanuts, but his actions seemed to indicate so.

As a result, it was likely Rauner would veto the bills, without much hope for an override, even if the House should pass them in the short time that remains. In that event, Democrats would at least have shifted the burden for the ongoing failure of state government onto Rauner.

PROPERTY TAX FREEZE THE PRICE

For his part, Rauner continued to insist that his price for agreeing to a budget was a freeze on property tax rates. That would affect local revenues, especially schools, but is not connected to the state budget or spending.

Manar explained it in this way: “We coupled this budget with a series of reforms that reflect our priorities, as well as those of the governor, including term limits on legislative leaders, school funding reform, pension reform, procurement reform and local government consolidation,” he said.

“Coupled with the reforms we’ve already passed this spring and ones we will continue to look at, I think we are well on our way to sending Governor Rauner a plan that should meet all of his requirements to stop holding the state of Illinois hostage after two years.

“Should that day come, perhaps then Governor Rauner will be able to turn his attention to finding immediate solutions to such pressing downstate matters as school funding reform, job creation, the shortage of new teachers and nurses, and the opioid crisis that’s sweeping Illinois.”

PARTY LINE VOTING

The bill hardly passed with an overwhelming mandate. Every Republican senator voted against it, as did five Democrats. Among southern Illinois and Metro-East senators, Democrat James Clayborne of East St. Louis joined Manar in voting for it, while Bill Haine of Alton did not vote. Republicans Dale Schimpf of Waterloo, Sam McCann of Plainview (near Carlinville), Kyle McCarter of Lebanon and Dave Fowler of Harrisburg all voted against it.

Other bills from the original “grand bargain” package that passed the Senate and were before the House at Labor Tribune press time included:

• SB1, Manar’s plan to reform school funding, passed by Democrats.

• SB3, to make consolidation of local governments easier, passed with bipartisan support.

• SB4, to sell bonds to raise money to pay some of the backlog of bills, passed by Democrats.

• SB5, to make the state’s contribution to teacher pensions, passed by Democrats.

• SB6, appropriations for state spending, passed by Democrats.

• SB7, for a new Chicago casino, passed by a bipartisan group.

• SB9, the tax bill.

• SB10, allowing home-rule cities more leeway for using tax money, passed with mixed support.

Other “grand bargain” bills never got out of the Senate, including a Republican plan to tinker with worker’s compensation, raising the minimum wage to $11, Rauner’s property tax freeze and a plan to trim public employees’ pensions.

That left the budget legislation in the hands of House Majority Leader Mike Madigan, who had not indicated what the House might do with it other than saying it will be “considered thoughtfully.”

TIME FOR TAX REFORM

Senator Dan Biss (D-Evanston), who is running for governor, called the budget plan “a small step toward fiscal stability” after two years of chaos under Rauner but said income tax reform remains a major need.

“It’s time to stop the dangerous, unproductive, two-year staring contest in Springfield,” he said. “A budget is a statement of priorities, and while this one is far from perfect, it reflects some core priorities – health care for the poor, P-12 schools, higher education, an increase in the tax credit for low-income workers and vital services for those who need our help.

“But long-term solutions to our fiscal problems will require bigger reform to create a fair tax system. We must repeal our constitution’s unjust and unusual flat tax provision; we must finally require millionaires and billionaires to pay their fair share; and we must eliminate the current carried interest tax loophole that allows the super wealthy to evade state taxes.”

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