Cullerton open to all sorts of tax hikes
In cash-strapped Illinois, everything from a 16-cent gas tax hike to taxes on Internet purchases and an income tax increase is on the table for new state Senate President John Cullerton.
The Chicago Democrat told the Daily Herald editorial board Monday that a range of tax hikes are inevitable unless residents want even worse roads, higher class sizes in schools and reduced medical treatment for seniors, the disabled and the poor.
"Everyone wants to go to heaven, but no one wants to die," he said about government services people want but no one wants to pay for.
The state faces a $9 billion shortfall, and lawmakers appear loath to make the dire cuts necessary to make up that amount without raising taxes.
For now, however, the new Senate president is playing close to the vest on exactly what hikes he thinks will pass muster with lawmakers and Gov. Pat Quinn.
While he floated several proposals, Cullerton says he will wait to see Quinn's budget plan, due out March 18, before committing to any of them.
The new governor has not ruled out tax hikes and neither has House Speaker Michael Madigan, also a Chicago Democrat.
Cullerton said he is starting off this legislative session - his first leading the Senate Democrats' supermajority - with a focus on passing a massive public works plan that could encompass $25 billion in spending.
He sees it as Illinois' version of the federal stimulus package, minus the tax cuts.
"A capital bill will be a stimulus to our economy," he said.
Cullerton said he prefers a per-gallon gas tax increase to come up with that cash. A 16-cents-per-gallon gas tax increase over the current 19-cent state tax would be needed to bring in $25 billion through loans as well as federal and local contributions.
Madigan also favors a gas tax hike.
With gas prices now hovering around $2 a gallon, politicians no longer fear a voter revolt that would have been expected when gas cost more than $4 a gallon last year.
"After it is imposed, I bet people are not even going to know," Cullerton said of the fluctuation in gas prices.
When it comes to government cuts, Cullerton said there was little fat to slice and that the reductions needed to balance spending and income would be "phenomenal," concentrating in education and health care, where the overwhelming bulk of state spending occurs.
"I don't know where we are going to cut," he said.
However, he did endorse one recurring measure to reduce pensions for incoming state workers and teachers, although he said he doesn't know if lawmakers will support the plan, which is aggressively opposed by unions.
As far as solving the state's budget crisis, Cullerton presented two plans he believes have the clout to pass. One would sign up Illinois to a multistate compact that funnels tax dollars back to the state from Internet sales. It would require some tinkering with state sales tax laws and could bring in up to $250 million, he said.
Another plan would add $1 tax to a pack of cigarettes. That would bring in $300 million, he said.
Cullerton said an income tax increase, perhaps temporary, may be in order. He proposed lessening the impact on the state's lower and middle classes by increasing deductions and credits.
Meanwhile, one funding source that appears on the outs lately is casino expansion. Quinn has said he does not want to expand gambling and Cullerton said he wouldn't consider it to fund a public works expansion.
To get any major tax increase approved, Cullerton is hoping to land Republican votes with a new conciliatory tone in the state Senate. He is hosting a dinner soon at the governor's mansion with both Republican and Democratic senators.
Any bipartisanship outreach on broadly unpopular tax hikes faces resistance from Republicans who hope to make considerable gains in the upcoming elections on the tail of the Blagojevich scandal. But Cullerton said his approach to the state's financial mess this year should be embraced by the GOP.
"We are just trying to raise money to pay our bills," he said. "That is a conservative point of view."