SPRINGFIELD – Gov. Pat Quinn warned Monday that he would propose slashing government spending to its lowest level in years in a budget plan that his office says still will include a tiny increase for education and an attempt to chip away at the state’s vast backlog of unpaid bills.
Quinn wants to increase education funding by $90 million, or about 1 percent, with the money going to early childhood education and college scholarships, spokeswoman Brooke Anderson said. His proposal also includes a call for closing unneeded tax loopholes as a way of coming up with money to gradually pay billions of dollars in overdue bills, she said.
Quinn said his proposal, to be presented Wednesday in a speech to the General Assembly, would include an operations budget lower than the one Illinois had in fiscal 2008.
“This is unheard of in Illinois, to have such great economy over the course of five or six fiscal years,” he said, describing the cuts. “We’ve made Herculean efforts.”
The state’s many budget problems include ballooning pension and health care costs. The Democratic governor said Illinois must take immediate action to control those costs before they consume most of the state budget.
It’s not clear whether Quinn will present detailed proposals for solving those problems when he speaks Wednesday.
Quinn aides said he would “lay out all the options” and “put the options out there.”
Anderson said Quinn was not counting on cutting pension costs in the upcoming budget and that the state would make its full contribution to the retirement systems for government employees. In the past, officials sometimes have come up with long-term savings plans and used them to justify making immediate cuts in pension support.
Chronically short of money, Illinois often delays payments to the businesses, local governments and community groups that provide services for the state. Many have been forced to borrow money, lay off workers or close their doors because of the state’s late payments. The backlog is roughly $9 billion.
Anderson said Quinn would propose scouring the state tax code for loopholes that don’t contribute to economic growth. Closing them, she said, would provide money to start reducing the backlog. “You can’t do them all overnight,” she said.
Closing loopholes the state no longer needs also would pay for new tax breaks the governor wants, Anderson said – ending natural gas taxes, giving credits for families with children and rewarding businesses that hire veterans.
Anderson said Quinn would call for a $2.7 billion cut to the state’s $14 billion Medicaid program, which provides health care to 2.7 million poor and disabled Illinois residents. Options for the cuts include eliminating some services, cutting rates paid to doctors and hospitals, and restricting eligibility so that fewer people can qualify.
She called it “a little bit premature” to talk about the number of people who might lose services.
Quinn already asked all of the state’s constitutional officers to cut their budgets by at least 9 percent. He will propose similar cuts for most state agencies under his control.
Quinn also said he would propose closing “quite a few” state facilities, especially those with aging infrastructure.