Less than a week remains until the May 31 deadline for Illinois’ General Assembly to pass a budget with a simple majority vote, and according to their custom, lawmakers probably will take it right down to the wire.
Many of the important votes yet to come will be on proposals aimed at raising more money for state government to spend. When it comes to actually cutting the state’s expenses, or putting Illinois on a path to making its runaway pension costs more affordable, there’s practically nothing on the table.
New Gov. J.B. Pritzker, whose Democratic Party controls both the House and Senate by wide margins, has proposed a $39 billion budget expecting to raise hundreds of millions with proposals including taxes on legalized marijuana, sports gambling and plastic bags. A proposed $41.5 billion capital bill would be supported by a 19-cent-a-gallon increase in the state’s gas tax, along with doubling registration fees to $199 a year for vehicles less than three years old, and tax hikes on liquor and tobacco products, among others.
Pritzker considers this a “bridge” year, hoping that voters will approve amending the state constitution to allow a graduated state income tax, designed to hike taxes on high earners, while slightly reducing income taxes for 97 percent of the public. At least, that’s what the rates likely will be to start. As wealthy people flee the state, who knows how many of us will find ourselves in the “high earner” tax brackets.
We’re not fundamentally opposed to all of Pritzker’s priorities. For example, many projects identified in his Rebuild Illinois capital plan would improve the everyday lives of countless people in Northern Illinois communities.
If lawmakers want the state to get a piece of the proceeds from activities that now go on under the table, or make “sin” goods like liquor and tobacco more expensive, that might not be so bad, either, provided the money is put to productive use.
But Illinois cannot simply tax its problems away. Cutting expenses is an essential part of balancing any budget, and spending reductions and cost-control measures are necessary.
While an amendment aimed at taxing people more is being pushed, there also should be a plan for getting pension costs under control.
A constitutional amendment tying increases in “Tier I” pensions to the consumer price index, rather than the guaranteed (and unaffordable) 3% boost they now get each year, is needed. It also should include a reasonable cap on the maximum amount anyone can collect in state pension benefits.
Pritzker says his graduated tax plan will reduce property taxes – so put it in writing. Give us a pledge that property taxes will be frozen or decrease for at least five years. We need to show the state’s remaining 12.7 million people that government is making an effort, not simply viewing them as a cash cow to be milked on demand.
Illinois cannot simply tax its way out of its problems. It also needs to bring fiscal discipline to its $8 billion backlog of unpaid bills and the $134 billion in unfunded pension obligations it has accrued.
The sooner voters wake up to this fact and demand their representatives act accordingly, the better.