Posted by Ray Long and Bob Secter at 5:22 p.m.; last updated at 6:32 p.m.
Gov. Pat Quinn‘s top aides said today that he will propose a budget balanced with spending cuts and borrowing because lawmakers have refused to raise taxes.
But the administration left open the door for Quinn to unveil an alternative proposal that would help close the budget gap by raising taxes.
For weeks, the governor has said Illinois residents should
prepare for a tax increase of some sort in this year’s budget proposal. But at a briefing for reporters late this afternoon, the Quinn administration continued to be mum on the details,
less than 24 hours before the governor formally unveils his budget
proposal to lawmakers and the public.
Jerry Stermer, the governor’s chief of staff, said reluctant lawmakers have not wanted to discuss a tax increase.
“We’ve not had a signal from the General Assembly that they’re willing to come to the table,” Stermer said.
Lawmakers likewise have not been willing to change state law to reduce required spending in some areas of the budget, Stermer added.
“The governor will propose a budget that doesn’t have new revenue,” Stermer said.
Everything the governor proposes is in essence an opening bid in a political process where the stakes have been raised by the state’s record $13 billion budget hole and the looming election that will decide who sits in the governor’s office and which party controls the legislature.
Stermer said the budget plan is based on five "pillars" of recovery: creating jobs, cutting costs, strategic borrowing, continued federal assistance and an increase in state revenues. You can read Stermer’s presentation by clicking here.
The governor would cut $1.3 billion from education spending and $70 million from a program that helps poor seniors buy medicine.
Even if lawmakers go along with Quinn’s cuts, the state still would be $11 billion short next year, Quinn budget officials said.
That’s where the options of a tax increase or borrowing come in.
Quinn aides said the administration will propose borrowing $4.7 billion and carrying over $6.3 billion of the state’s debt.
A year ago, Quinn proposed a 50 percent increase in the income tax rate coupled with expanded tax relief for some middle-income earners.
Quinn later supported other tax hike ideas, including a 67 percent tax increase that passed the Illinois Senate but stalled in the House.
Quinn’s team started dribbling out proposed budget cuts last month, including less money for education next year.
Today, Chris Koch, the state education superintendent, told a House panel he expects 13,000 school-related layoffs by next year.
Quinn’s also budget contains a proposal for a $2,500 tax credit to small
businesses for each full time job created the next year. The credit
would apply to businesses with 50 or few employees. The administration
estimates the state would give the credit on 20,000 new small business
jobs.