Illinoisans can be forgiven for having a sense of deja vu. The six-month spending plan passed by the General Assembly at the end of June expired at midnight Saturday.
As of now, state lawmakers aren’t due to return to Springfield until Jan. 9 for what would be a very abbreviated lame-duck session where outgoing lawmakers could still vote on a new state spending plan and elements of Gov. Bruce Rauner’s pro-business “turnaround agenda” if they chose.
The 100th edition of the General Assembly will get started Jan. 11 when inauguration ceremonies are held for senators and representatives elected in November.
In the meantime, here are some questions regarding the state of the state’s struggling finances.
Does the end of the stopgap budget mean the end of state spending?
No. As has been the case for some time now, a large part of state spending will continue even with the expiration of the stopgap budget. Various court orders, consent decrees and continuing appropriations (covering things like pension and bond payments) continue to be in effect. State workers will continue to be paid because of a pre-existing court order. Also, K-12 schools will continue to receive payment because lawmakers approved a full year budget for them. The state’s fiscal year ends June 30.
How much of the budget is covered by these payment mandates?
Estimates vary depending on who is making the estimate. They range as high as 90 percent, although the Center for Tax and Budget Accountability put the figure at about 67 percent.
If all of that spending it going on, what is the problem?
There are still significant parts of the budget, including things like higher-education operations costs and a number of human-services programs, that aren’t covered by court orders or consent decrees and need spending authorization so that their bills can be paid.
Also, while those court orders, consent decrees and continuing appropriations require that certain bills be paid even without a budget, they don’t guarantee the state has the cash to pay them. That problem was greatly magnified when the bulk of the temporary income tax increase was allowed to expire in January 2015. It resulted in far less money coming into state coffers, but expenses continued as before. It’s meant that it takes longer and longer for a bill submitted to the state to get paid. It’s also meant the backlog of bills sitting in the comptroller’s office is over $11 billion and climbing.
Who is hurt by the end of the stopgap budget?
The spending authority that sent money to higher education, along with the authority to pay tuition grants under the Monetary Award Program, no longer exists. Nor does spending authority for human-services programs that were not otherwise covered by court orders or consent decrees.
Pay Now Illinois, a coalition of human-services providers, is in court attempting to force payment of bills they are owed. In its latest filing, the coalition noted that payments authorized in the stopgap budget mostly went to pay expenses incurred before June 30, 2016, the prior fiscal year. It said the agencies have receiving no payments for services they’ve rendered this fiscal year.
“The failure to pay has had a devastating effect on cash flow to the plaintiffs and ability to survive week to week and made it impossible to resume to full strength many of the programs that plaintiffs had to reduce or shut down during the fiscal year 2016,” the filing says.
Now, even the limited spending authorized by the stopgap budget no longer exists. Many of those agencies have laid off staff, curtailed programs and spent down any reserves they might have had in order to keep going during the budget stalemate. The result of all of this, the lawsuit says, “will come down with brutal force especially on the homeless, runaway youth, women who have been sexually assaulted and seniors who are trying to stay in their homes and out of institutions.”
Where do things stand on possibly enacting a permanent budget?
The same place they’ve been for months. Nearly everyone, including Republican Gov. Bruce Rauner, has said that for the state to get a long-term balanced budget, some combination of budget cuts and tax hikes will have to be approved. However, Rauner has continued to insist that he won’t talk about raising taxes until lawmakers approve some of his reform ideas that he says are essential to improving the state’s economic climate. He’s said that’s the only way to ensure Illinois’ financial stability.
Groups of rank-and-file lawmakers have been holding discussions on things like workers’ compensation reform, government consolidation and even the budget itself, but nothing has reached the point of an agreement. Ultimately, any compromise achieved by the working groups of lawmakers would have to be signed off on by Rauner and the four legislative leaders before it would move forward.
They haven’t been meeting, though, have they?
No. Rauner called off the last scheduled meeting with the leaders because he said the Democrats weren’t ready to talk about budget specifics. Rauner has since said he doesn’t think the Democrats are serious about reaching a compromise and are stalling. He said he’d call for more meetings when he thinks they are serious.
The Democratic leaders disagree with Rauner’s assessment, arguing that it’s the governor’s constitutional responsibility to present a spending plan for them to consider.
Where do we go from here?
Good question. Rauner’s office did not want to talk about the budget situation before Christmas.
During an appearance in Chicago last week, Rauner was asked about his contingency plans for the budget. He dodged the question.
“I’m optimistic if we continue to have a good dialogue and be respectful of each other and do bipartisan things, we can get a balanced budget with reforms,” he said.
He then repeated that he needed “at least a down payment on reforms” if lawmakers choose to do another stopgap budget rather than a longer-range plan. Lately, that’s meant putting a term-limits amendment on the 2018 ballot and enacting a permanent property tax freeze.
Asked what he’ll do if he gets neither, Rauner said, “We’ll get things done.”
The bipartisan working groups discussing reforms continue to make progress, Chicago Democratic Rep. Greg Harris said. But, pinning down just which policies are priorities has been a challenge.
Still, Democrats are ready to work in similar rank-and-file groups to discuss a budget, he said. That strategy was successful in getting the stopgap bill and other funding plans passed, Harris said.
“This formula has worked successfully,” Harris said. “Both House and Senate, Democrats and Republicans, in a room together to discuss and find compromises on budgetary items.”