Illinois Policy Institute five-year plan repairs Illinois’ fiscal crisis by addressing root cost drivers
By adopting the reform package in Budget Solutions 2020, in just five years Illinois’ unpaid bills could be gone and residents could see a tax cut.
The Institute’s plan:
- Balances the 2020 budget
- Turns perpetual budget deficits into a $2.1 billion surplus by 2024
- Allows for a tax cut in just five years
If lawmakers do nothing, the state’s finances will continue to deteriorate. Illinois will continue to face multibillion-dollar budget deficits each year. By the end of fiscal year 2024, the state could see an unpaid bill backlog of $24 billion – the highest in Illinois history.
But Illinois’ leaders can choose a different future. Budget Solutions 2020 relies on commonsense solutions, many of which have already received bipartisan support.
Components of the plan:
- Pension reform (Savings of $12.2 billion over five years): Illinois lawmakers should amend the state constitution to protect earned benefits, but allow for changes in future benefits.
- Redirecting education funds to the classroom (Savings of $2.9 billion over five years): Reducing administrative bloat through school district consolidation can lead to more money to invest in classrooms, students and teachers.
- Ending automatic pay raises and rightsizing health insurance costs for government workers (Savings of $4.2 billion over five years): The state should no longer provide automatic pay raises to state workers, who are already among the highest-paid government workers in the nation. Workers should pay a share of their own health insurance costs that more closely matches their peers in the private sector.
Quote from author Adam Schuster, Illinois Policy Institute director of budget and tax research:
“For the past dozen years, the hallmark of Illinois’ budget season has been chaos – deficit spending, a running backlog of bills and a scramble to pass a plan at the last minute.
“The reason? It’s hard to make the numbers work when Illinois’ biggest cost drivers, namely government worker pensions, salaries and health insurance, continue to eat up the bulk of state spending at the expense of social services, higher education and more.
“But enacting structural spending reforms can completely rescue Illinois’ finances and restore harmony to the budgeting process. Gov. J.B. Pritzker and lawmakers in the General Assembly are in a unique position today to champion these reforms and ring in a brighter future for Illinoisans in just five years.”
To read “Budget Solutions 2020: A 5-year plan to balance Illinois’ budget, pay off debt and cut taxes,” visit https://illin.is/budgetsolutions.
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