Madigan proposes Illinois budget plan that overspends by $7 billion
Despite a constitutional requirement to do so, Illinois politicians have not passed a balanced budget since 2001.
The wording in the Illinois Constitution seems clear: “Proposed expenditures shall not exceed funds estimated to be available for the fiscal year as shown in the budget.”
But for more than a decade, Illinois lawmakers have used borrowing and budget gimmicks to pass unbalanced budgets.
The same was true May 25, when Illinois House Democrats proposed and passed a fiscal year 2017 budget plan that is nearly $7 billion out of balance, according to Illinois Office of Management and Budget analysis. Illinois Comptroller Leslie Munger said this proposal could increase Illinois’ unpaid bills to $15 billion from $7 billion, and could cause eight to nine month payment delays for vendors.
Munger said: “That means everyone – small businesses, nonprofits, schools, hospitals, elected leaders and others – will wait even longer for what they are owed by the state.”
With $32.6 billion in expected revenue for 2017, SB 2048 is far out of line with what the state can afford, and Gov. Bruce Rauner will certainly veto the plan.
How can politicians continue to propose unbalanced budgets? Simple: Illinois’ constitutional requirement for a balanced budget allows lawmakers to push off any budget shortfall into the future. Illinois has not had a balanced budget since 2001. In fact, in May 2011 – less than six months after the General Assembly enacted a 67 percent state income-tax increase – lawmakers passed a budget that used an accounting gimmick to push more than $1 billion in unpaid bills to the next fiscal year.
House Joint Resolution Constitutional Amendment 47 would strengthen the Illinois Constitution’s balanced-budget requirement, giving teeth to the current balanced-budget requirement by requiring that spending can’t exceed revenue and prohibiting the use of budget gimmicks – such as incurring more debt, refinancing or using fund sweeps – in the calculation of revenue.
The governor has proposed passing the Unbalanced Budget Response Act, which would temporarily allow the governor to shift funds and reduce spending to balance the state’s budget.
The proposal would temporarily authorize the governor to:
- Set aside money as “contingency funds” to make sure the state can pay for core services without having to borrow more.
- Reduce rates the state pays to service providers.
- Move unspent money out of certain special funds and into the state’s general-revenue fund.
- Change or delay payments under continuing appropriations.
Certain funds such as those devoted to schools, early childhood education and debt service would remain untouched.
None of this would be necessary, however, if Illinois politicians would do their job and spend within the state’s means. The passage of SB 2048 indicates this won’t happen anytime soon.