Illinois Senate President John Cullerton said Monday both an income tax increase and budget cuts are needed to erase an estimated $13 billion state budget hole, while Mayor Richard Daley emphasized that cuts should come before the state asks taxpayers for more money.
Both Chicago Democrats were responding to a report by the Civic Federation of Chicago calling for a combination of cost-cutting and tax increases to bail out state government.
“You just can’t increase taxes and say, ‘That’s the answer,’” Daley told reporters. “That’s not the total answer. If you think that is, you’re kidding yourself.”
Although he had yet to read the group’s report, Daley said he knew it called for deep spending cuts.
“You have to streamline government,” said the mayor, who has both cut some spending and raised taxes and fees to balance the city’s precarious budget in recent years. “You have to look at priorities and figure out if there’s waste, inefficiency and corruption, anything, because you have to look at that. ”
Speaking at the City Club of Chicago, Cullerton said lawmakers and Democratic Gov. Pat Quinn should be prepared to make deep budget cuts in addition to a tax increase.
He called on lawmakers in the House to vote on the plan passed by the Senate last year that would boost the state’s personal income-tax rate to 5 percent from 3 percent. The House never considered the Senate plan and instead rejected a smaller, temporary tax hike. Republicans, who make up a minority in both chambers, have refused to endorse an income tax increase.
Cullerton said the media should draw more attention to the state’s budget problems in order to build public support for a tax hike.
Cullerton also called for changing the state’s underfunded pension system, which has become a major drag on the budget. “This has come to a head,” Cullerton told reporters. “We’ve got to do it right away.”
He suggested the age at which retirees can receive maximum benefits be raised to align more with federal Social Security guidelines, and that those payments be lowered from the current maximum of $245,000 a year. Cullerton said those changes could result in a long-terms savings of $120 billion, but acknowledged they would not have an immediate impact.
Cullerton also took a swipe at colleague and presumptive Republican governor nominee Sen. Bill Brady of Bloomington, who says the state can cut its way out of its money problems without raising taxes.
“Maybe he hasn’t spent enough time like I have in trying to figure out how to balance this budget, maybe he’s been a back-bencher and hasn’t really been looking at this” Cullerton said.
He called on Brady to introduce his own budget proposal before the November election.
“Why should we wait until after the election to find out what the budget proposals are?” Cullerton said. “He wants to be the governor during the fiscal year that we’re going to be voting on the budget. So put the budget in. Put it in."
Brady, who is awaiting official results from election authorities on his slim lead over fellow Sen. Kirk Dillard of Hinsdale following the Feb. 2 GOP primary, said he plans to release "key points" on how his budget ideas differ from those of Quinn. The governor is scheduled to give his annual budget address on March 10.
But Brady said the main difference is that he will reduce spending and cut taxes, not raise them.
"I’m not going to spend beyond our means like John Cullerton and Pat Quinn and Rod Blagojevich," Brady said. "Those guys have spent money that the people of Illinois frankly didn’t have. They have been completely irresponsible. We will bring responsibility back to the state’s fiscal condition."