Setting the stage for some post-holiday fireworks, House Speaker Mike Madigan promised Wednesday to override Gov. Rauner’s budget veto and “begin healing the wounds” — but less than an hour later the governor vowed to do everything in his power to stop Madigan and his “disaster” of a tax hike.
Adding to the explosive mix, the nonprofit group run by Illinois’ first lady, Diana Rauner, weighed in, “strongly” urging the House of Representatives to override the governor’s veto.
A day after vetoing the Democratic budget package, Rauner returned to the Hegewisch neighborhood on the Far South Side to again call for Springfield lawmakers to stop trying to raise taxes “without fundamental reform.”
Rauner also cautioned members of the General Assembly to not override his veto, adding that his administration was doing “everything possible to make sure my veto stands and that it’s not overridden.”
On Tuesday, the Illinois Senate approved a revenue measure that will hike the individual income tax rate to 4.95 percent, up from 3.75 percent, and raise an addition $4.6 billion. The corporate income tax rate would climb to 7 percent from 5.25 percent, bringing in about $460 million.
The spending bill, also approved Tuesday by the Senate, totals $36.1 billion and includes $2.5 billion in spending cuts, and 5 percent in across-the-board cuts to state agencies. It also includes reductions to state programs, grants and other expenditures.
“I vetoed this tax hike,” Rauner said. “I will always veto tax hikes without fundamental reform. Tax hikes are not the answer.”
The Ounce of Prevention Fund, an early childhood education foundation headed by Rauner’s wife Diana, issued a statement Wednesday calling for the House to override the governor’s veto.
“The governor vetoed the bills and the Senate has voted to override that veto,” the statement read. “We strongly urge the House of Representatives to now follow the Senate in voting to override the governor’s veto.”
The state currently has $14.7 billion in unpaid bills and has just entered its third consecutive fiscal year without a budget. Credit monitoring agencies have previously warned that without a budget, the state’s bond rating could fall to “junk” status, which would be a first for any state in the country.
On Wednesday, Rauner downplayed the agencies’ forecasts.
“Don’t listen to Wall Street,” Rauner said. “Don’t listen to a bunch of politicians who want power and to stay in power like they’ve been for 35 years. Listen to the people of Illinois. The people of Illinois don’t want more taxes on their lives.”
After the press conference, Moody’s issued a statement saying the state’s Baa3 bond rating has been designated for review.
Though not enough members of the Illinois House were present in Springfield on Wednesday for an override vote, the chamber is set to reconvene at 1:30 p.m. Thursday, and Madigan has said they will vote to override at that time.
Fifteen Senate Republicans voted in favor of the revenue and spending measures, breaking from the governor, who offered thinly veiled criticism.
“We have had failure — failure by elected officials in Springfield for decades,” Rauner said. “What we have is a continuing failure by elected officials in Springfield on both sides of the aisle. It’s been led by Speaker Madigan for 35 years. This is more of the same. Our system is broken.”
Declining to offer specifics, the governor said he was doing “everything possible to make sure my veto stands.”
If the Illinois General Assembly overrides the revenue and spending package, Rauner would be able to run for re-election saying he fought against a permanent income tax hike — though the new rate is one he had supported during negotiations — while the state will get necessary funds to run operations.
“This isn’t about politics, this is about doing the right thing for the people,” Rauner said.
Rauner addressed reporters in the back room of Club 81 Too on South Avenue M in Hegewisch, where early afternoon bar patrons greeted him with applause.
Joining him were other residents and business owners who bemoaned the state’s property tax rate. Rauner has previously said that he needs property tax relief and changes to workers’ compensation in order to approve a hike.
Outside the bar after the press conference, Rauner took photos — including one selfie — with some supporters, including police officers and firefighters, before driving away.
In early June, Rauner visited Hegewisch and toured the neighborhood’s business district. After speaking with local business owners, he offered a similar slam on property tax rates.