SPRINGFIELD — House Speaker Michael Madigan on Monday declared an extension of the 2011 temporary income tax increase dead for the spring and said House Democrats are preparing a “middle-of-the-road budget” that eases up on spending cuts that were part of a failed budget blueprint last week.
Madigan informed his 71-member House Democratic caucus that he was taking the income-tax extension favored by Gov. Pat Quinn off the table and shifting budgetary strategy as state lawmakers enter their final week before a scheduled Saturday adjournment.
“We’re proceeding under the expectation that the income-tax increase will not be extended,” Madigan told reporters after a Monday committee hearing at the Statehouse.
State income-tax rates that rose in 2011 to 5 percent for individuals and 7 percent for corporations are scheduled to drop in January to 3.75 percent and 4.8 percent, respectively, creating a budget shortfall in the upcoming fiscal year of more than $1 billion.
Madigan said the new spending plan that he expects to emerge soon will be a hybrid of the so-called failed “doomsday” budget that mustered only five House votes last Friday and an earlier, more-generous package of 73 spending bills that passed the week before on the assumption the income-tax extension would pass.
“As you know, the House adopted the budget that was consistent with the extension of the income tax increase. Last Friday, the House rejected the ‘doomsday’ budget,” Madigan told reporters. “Today, we’ll have our working groups, our appropriations working groups, working toward a middle-of-the-road budget that would be consistent with the revenue estimates, which have been adopted by the House, and we anticipate that there will be an amendment to that revenue estimate in light of information that has come to us there is about an additional $189 million available in this budget year.”
Madigan said the plan now being drafted would make required pension payments and hold funding steady for elementary and secondary education, which had faced a $570 million cut in the plan voted down in the House last Friday.
“We’re always interested in providing more help for education, but at the same time we’re required to live with the revenue estimates that are available. So, living within the revenue estimates that we’re working with, we’re going to do our best,” the speaker said.