SPRINGFIELD — Lawmakers inched closer to enacting a budget on a dizzying Fourth of July — with the Illinois Senate in rapid succession approving spending and revenue bills and then overriding Gov. Bruce Rauner’s immediate vetoes of the budget package.
But it remained unclear when the state will finalize a budget to begin to unwind a fiscal mess that has left a $14.7 billion backlog of unpaid bills, with social service agencies and public universities left high and dry. The Illinois House didn’t have enough members in town to vote to override, with attendance issues also likely on Wednesday.
Though two of three major rating agencies said they’re encouraged by the progress, there’s still a chance they could lower Illinois’ bond rating when Wednesday after the extended break of the holiday weekend. And as Rauner and Madigan continue their political war, they have one thing in common: neither wants anything to do with being blamed for Illinois attaining “junk” bond status.
The revenue measure 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 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.
Rauner — who has been vocal on social media, but otherwise out of the public eye — made his position well-known about the budget package passed by both chambers, saying in his veto message it “will lead us to become the highest taxed state in America in the coming years,” and labeling the revenue hike “Madigan’s 32 percent permanent income tax increase.”
While the spending and revenue package had some bipartisan support, Rauner has said he needs changes to workers’ compensation and property tax relief in order to approve a tax hike. Democrats have fought off some of the governor’s reforms, declaring they’ll hurt the middle class.
Should the Illinois General Assembly override the revenue and spending package, Rauner would be able to run for re-election saying he fought against a permanent income tax hike, while the state will get necessary funds to run operations.
The governor also criticized the spending bill in his veto, with Democrats on Sunday adding language that would block money for schools unless the governor signs an “evidence-based model” in their desire to see a Democratic-sponsored school-funding formula bill be signed.
Rauner in his veto says the measure “holds K-12 school funding across Illinois hostage to force a bailout of Chicago Public Schools.”
The governor has said he’ll veto a Democratic sponsored school funding formula bill, but Illinois Senate Democrats say they plan to send the bill to his desk soon and will try to override his veto.
Senate passage of the revenue bill came after just under 10 minutes of debate with a 36-18 vote. Votes on the spending and budget implementation bills followed quickly.
“My expectation is that the bills that the Senate just passed will become law and we will have taken a huge step towards correcting the financial imbalances of Illinois,” Madigan told WICS-TV after the Senate budget passage.
Madigan stood on the Senate floor with Illinois Senate President John Cullerton during the initial votes of the budget package Tuesday morning.
The Illinois Senate — who initially crafted the measures in their “grand bargain” package — voted to override the vetoes within minutes of Rauner’s announcement.
While 15 House Republicans voted for a revenue bill on Sunday, the Illinois Senate saw just one Republican break ranks. Sen. Dale Righter, of Mattoon, said he voted to support the entire spending package for his district, where Eastern Illinois University has seen huge cuts during the impasse. When asked about pressure from the governor and Republicans to not support it, Righter said both were “respectful” of his decision.
“My district told me to vote for this package,” Righter said.
Senators Tom Cullerton, D-Villa Park, and Julie Morrison, D-Deerfield, voted no on the revenue measure. State Sen. Bill Haine, D-Alton, suffering from a rare blood cancer, returned to Springfield to help Democrats clear the bill: “Although I have been facing some hardships over the last few months, this is bigger than me,” Haine said in a statement. “This is about the citizens of Illinois and ensuring they have a future in this great state.”
During floor debate, Senate Republican Leader-designee Bill Brady called the budget package “incomplete,” asking instead for a “comprehensive solution” for the state.
“We’ve negotiated in good faith on a comprehensive solution and I regret to say we have not come to a conclusion to the comprehensive solution,” Brady said, adding there’s still no agreement on workers’ compensation and property tax relief.
But revenue bill sponsor, State Sen. Toi Hutchinson, D-Olympia Fields, said the state doesn’t have any more time, as credit agencies monitor legislative progress to determine whether the state’s bond rating will drop to “junk”: “Too late is not good enough.”
“Right now, in this moment, in this time, on this day, the choice is simple … we live to fight another day or we watch the state crash,” Hutchinson said.