Rauner to legislators: Pass my reforms or allow budget cuts

SPRINGFIELD, Ill. (AP) - Republican Gov. Bruce Rauner offered lawmakers two distinct options Wednesday to end Illinois' historic budget stalemate: Implement his cost-saving proposals in exchange for a $36 billion budget, or give him authority to make $4 billion in cuts.

Rauner's second budget address, delivered eight months after the current fiscal year's budget should have taken effect, reinforces what he's said in the past about his openness to raising taxes - but only if lawmakers are willing to give him some of the reforms he wants.

"You choose," he told lawmakers. "But please, choose now."

Without some reforms, he added, "We cannot in good conscience raise taxes on the hard-working families of Illinois."

Democrats who control the Legislature already have balked at the idea of giving Rauner unilateral power to make cuts, repeatedly dismissed his suggested reforms, such as curbing the power of unions, and say the solution is a combination of spending cuts and raising taxes on the wealthy.

The speech only made them dig in harder.

"We're all better served ... if we follow the traditional approach, people become reasonable with each other, move away from extreme agendas, recognize that the No. 1 problem facing the state of Illinois is the budget deficit," said House Speaker Michael Madigan, who's been Rauner's chief political rival during the stalemate.

Rauner's budget with cuts would be $32.8 billion, because the state doesn't have enough revenue to match a $36 billion spending plan that would cover all expected state agency operations. Even members of his own party said nearly $4 billion in cuts is an unappealing option.

"My belief is those reductions would be so steep as to be harmful to the state overall, if we only dealt with reductions," said Rep. David Harris, the Revenue and Finance Committee's ranking Republican. He said the state must find additional revenue, whether through taxes or cost-saving reforms.

Sen. Christine Radogno, the Republican leader in the Senate, praised Rauner's speech.

"I thought it was a fair assessment of what our choices are right now given the extremely serious financial condition that we're in," she said. "It was delivered without rancor and with a sincere invitation once again to the Democrats to come to the table and negotiate a good path forward for the state."

Illinois faces a roughly $5 billion budget deficit this year, and its unpaid bill backlog could reach almost $26 billion by 2020 if current revenue and spending policies continue. Since the beginning of this fiscal year in July, several social service programs have closed or seen massive cuts, and officials at the state's public colleges and universities are worried their institutions will be permanently harmed if a budget doesn't come soon.

A roar of chants calling Rauner to fund higher education filled the third-floor rotunda during the budget address, with hundreds of Illinois college students yelling, "Save our schools!" Demonstrators booed him following his speech.

The predicament of giving a budget address for the future while still having no spending plan for the current year mystified Democrats.

"We're more than halfway through a budget year with no budget, and now we are debating what could best be described as sketches for a budget for next year, so it almost wasn't a budget address," Senate President John Cullerton said.

Many of the sticking points in the ongoing battle haven't changed, including negotiating a new labor contract with the state employees' union that would save $3 billion over three years.

Rauner wants state labor regulators to determine whether the negotiations with the American Federation of State, County and Municipal Employees are at an "impasse," a declaration that would open the door for him to impose his on terms on state workers. Democratic leaders have remained steadfast in their support for AFSCME, which has been one of the party's biggest political allies over the years.

Rauner, a wealthy former venture capitalist, also remained steadfast in the pro-business political philosophy that helped him defeat Democratic Gov. Pat Quinn in 2014, emphasizing that the key to the budget crisis includes reducing worker compensation costs, passing tort reform legislation and lowering property taxes.

"To create jobs and raise incomes, we've got to change our state's reputation as being hostile to business," Rauner said.

___

Associated Press writer Ashley Lisenby contributed to this report.