Burning the near midnight oil, Illinois lawmakers on Saturday morning brought forth a budget closely hewed to Gov. JB Pritzker’s February proposals, one that led to the mandate of a balanced budget, along with relief for taxpayers with spending at $45 billion, and also gives one time payments to individual and married taxpayers, plus rebates to homeowners, and while Republicans have derided the bill as one filled with gimmicks in an election year, nevertheless it does provide significant monies, including refilling a”rainy day” fund that was depleted for nearly two years under the leadership of former Gov. Bruce Rauner.
Pritzker praised the efforts of the Democrats and said, in part, “It honestly felt that we all came into this process committed to a fiscally responsible spending plan that improves our state’s finances and helps people in an hour of genuine need,” no doubt responding to the still lingering problems of Covid and, now, rising inflation.
Of course, no one puts anything less than a concerted effort for a fiscal budget in an election year and with a 73/45 majority in the House and a 41/18 in the state Senate, Democrats are clearly in the driving seat.
One issue that is unaddressed is the $4.5 billion hole in the unemployment fund, and that failure may cost them along the road, during the June 28th primary contest. The idea is to take $2.7 billion in federal monies form the American Rescue Plan to help pay down that hole which is normally paid down by a self sustaining payroll tax, that went off the rails as more and more Covid related layoffs occurred..
“This action will lead to the largest tax increase on business in the state of Illinois in this state’s history. Employers who have been treated with absolute disregard throughout this pandemic will literally be left holding the bag, and will be responsible for filing the remaining deficit to the Unemployment Insurance Trust fund,” said state Sen. Don DeWitte (R-St. Charles) late last month, according to WTTW television.
“Illinois could – Republicans argue should – have immediately dedicated $4.5 billion of its $8.1 billion in American Rescue Plan Act (ARPA) dollars to wipe out the debt, as did other states.”
And, another is that the suspension of the gas tax will dent road repair, which the tax is designed to address. But, In February Pritzker said that the savings would be $135 million, “without delaying any infrastructure projects funded by the motor fuel tax,” according to the Quad City Times.
A direct criticism by some observers will not only be inflation, but increased crime that is hurtling across the nation, but especially in its largest city, Chicago, where carjackings, personal assaults and subway crime have taken the city down a drain hole, and how the money for violence prevention is spent will depend on a significant decrease, especially in Chicago.
The plan is for $200 million.
For inflation the plan is for a suspension in the 2.2 percent gas tax, and rebate checks up to $300 to homeowners; and, for taxpayers making less than $200,000 per year and joint filers, less than $400,000, $50 each, and $100 “per dependent child, up to three children, according to the Chicago Tribune.
Rounding the corner is a “permanent increase of the state earned income tax credit, which lowers tax bills and often produces refunds, “ for low, and even moderate, income people, especially in households with children, which centers the credit, much like it is on the federal side.
What might surprise some is the $1 billion into the nearly empty aforementioned fund, from the Rauner administration; and even further is an extra payment of $200 million into the woefully underfunded pensions system still the highest in the country.
Adding to the required payment of $9.6 billion gives naysayers a pause, especially in a separate increase of $300 million from March.
This comes from, they say, increased revenue in areas that took in higher earnings and was taxed accordingly, State Comptroller Susan Mendoza has also lowered the backlog of unpaid bills by $3 billion, from $17 billion.
In the past, “major industries that contributed the most to Illinois’s gross domestic product in 2020 were finance, professional services, manufacturing, government and social services,“ noted the Urban Institute.
$200 million is targeted for fighting crime, an issue that has gained national prominence with Dems being soft on crime, especially on the federal level, and their criticism of newly confirmed Supreme Court Justice Kentaji Brown Jackson.
In that vein, Illinois Democrats have extended a 2027 law that lets police use eavesdropping devices during criminal investigations, and extending street gang racketeering law by one year,” added the Tribune.
Bread and butter issues, literally are not ignored and there is a “family relief plan” that includes a temporary suspension of a 1% state tax on foods, equalling one dollar per $100 of food.
While the gaping hole in the unemployment fund, remains to be fixed, supporters and even some earnest critics have agreed that even having a surplus is boon to a state long mired in debt, and the tax benefits and rebate checks to homeowners, and individual and joint filers, gives some gravy to go with the potatoes, even if the whole meal has not been paid for.
