Illinois Senate vows swift action on ambitious budget plan
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SPRINGFIELD — If last week’s action is any indication, the Democratic and Republican leaders of the Illinois Senate are serious about attempting to bust the state’s 18-month budget deadlock — quickly.
Democratic Senate President John Cullerton and Minority Leader Christine Radogno negotiated an ambitious, multi-part plan to end a nearly two-year battle between Democrats and GOP Gov. Bruce Rauner, which has forestalled an agreed-upon annual state spending plan since 2015.
Promising to act on a package by month’s end, they introduced 13 measures Wednesday that included non-budget-related sweeteners for both sides. By Thursday, they had been rapidly assigned public committee hearings.
The package includes Democrat-friendly ideas such as a minimum-wage hike and an income-tax increase — which many in both parties agree is necessary to pare down a multibillion-dollar deficit. But it also seeks to meet Rauner’s demands for measures he says will improve the business and political climate. There’s legislation to freeze local property taxes, a must-have for Rauner, and to tighten rules on when injured workers may make claims under the workers’ compensation law.
The Senate put one Rauner wish on the books already. It voted unanimously last week to limit, by Senate rule, its leaders to 10 years at the helm. Radogno promises to expand the idea with a constitutional amendment in the future.
Not only is the timeline aggressive — the Senate is scheduled to be in Springfield only three more days this month, including one reserved for the governor’s State of the State address — but so is the end game. The package of bills includes a pension-reform plan to reduce more than $111 billion in underfunded retirement accounts — a solution that has long eluded lawmakers.
The outstanding question is if a Senate-approved deal would ultimately pass muster with Democratic House Speaker Michael Madigan, who has refused to entertain Rauner’s pro-business agenda as part of budget talks.
Here’s a look at other major pieces of the legislation some in the Capitol have nicknamed the “grand bargain”:
• Income tax increase: The personal income tax would jump from 3.75 percent to 4.95 percent, a plan to generate $4.1 billion a year. With spending cuts, Democrats argue, that could eliminate what the governor’s office estimates will be a $5.3 billion deficit on the June 30 end of the fiscal year.
• Borrowing to pay down debt: The legislation would allow Illinois to borrow $7 billion by selling bonds to pay off overdue bills, which on Friday totaled $10.7 billion. The loan would get the state back to paying vendors and service providers within 30 days of receiving their bills.
• Covering costs: The plan includes $694 million to cover expenses for the first half of 2017 for seven agencies, including prisons and the Human Services Department. A six-month, temporary budget agreed to last summer expired Jan. 1 and the state is back to operating without appropriations.
• Pension reform: The proposal would eliminate pensions for future legislators. It aims to save up to $1 billion a year by offering what Cullerton has termed “consideration” — essentially a choice between how future pay raises figure into retirement income or whether pensioners receive cost-of-living adjustments in retirement.
• Teacher pensions: The measure would move Chicago’s responsibility for paying the employer’s portion of teachers’ pensions to the state — a $215 million obligation for 2017 alone. That would remedy a long-running complaint about fairness from cash-strapped city officials, since the state already picks up the employer portion for teachers outside the city.
• Gambling expansion: Similar to a contentious proposal from previous years, the plan would create a land-based casino in Chicago and add riverboat casinos in Lake County, Rockford, the south suburbs of Chicago, Danville, and in Williamson County, in southern Illinois, as well as giving horse racing tracks a piece of the action by permitting slot machines at Arlington Heights, Cicero and Collinsville.
• Workers’ compensation: Democrats have argued they made important changes to the injured-workers program in 2011 and that the insurance industry hadn’t caught up to those cost-saving measures. This plan would further restrict claims when injuries are accidents, set maximum compensation rates, and limit physical therapy, among other things.
• Minimum wage: The minimum wage would increase from $8.25 an hour to $9 on July 1, then by 50 cents each year until 2021, when it will be $11. According to the U.S. Labor Department, the wage exceeds $8.25 in 21 places outside Illinois, including the District of Columbia, which is tops at $11.50.