Illinois House OKs budget 'kicking the can down the road'

SPRINGFIELD -- Having given up on extending Illinois' temporary income tax increase at least for now, the legislature is moving forward with a scaled-back budget that could lead to layoffs, further delays in paying the state's bills and a post-election vote to make the tax hike permanent or generate some other source of revenue.

The House on Tuesday approved the $35.7 billion 2015 spending plan, which key Democrats acknowledge relies on some of the same practices that got Illinois into financial trouble in the first place.

That includes not allocating enough money to cover expenses, using money from special funds for day-to-day operations, and banking on future increases in revenue that might or might not materialize.

"We are kicking the can down the road," said state Sen. Heather Steans, a Chicago Democrat and a lead budget negotiator.

The plan could head to the Senate soon, but House Speaker Michael Madigan used a procedural move to hold onto the budget for now, raising questions about the proposal's eventual fate and about whether another spending plan could emerge by the budget deadline Saturday.

Lawmakers drafted the plan after Madigan announced his chamber had given up on extending a temporary income tax increase that Democrats approved in 2011. The increase, which cost the typical taxpayer $1,100 last year, is set to roll back from 5 percent to 3.75 percent for individuals on Jan. 1. That will lead to a $1.8 billion drop in revenue next year.

"You don't always get what you want," said state Rep. Fred Crespo, a Hoffman Estates Democrat who has opposed the tax extension. "You get what you can get."

Madigan, Gov. Pat Quinn and Senate President John Cullerton all were pushing to make the higher tax rate permanent, but Democrats in the House -- where all members are up for re-election in November -- couldn't garner enough "yes" votes. The chamber last week also overwhelmingly rejected a so-called doomsday budget that would have cut funding to schools and other areas.

Quinn's office called the spending plan that advanced Tuesday "incomplete."

"The budget doesn't avoid the tough decisions. It just postpones them," said his spokeswoman, Brooke Anderson.

The budget keeps funding for education and most state agencies flat next year. Without money for increased costs, lawmakers said it's likely that agencies such as human services, corrections and Illinois State Police will have to lay off staff members. Anders Lindall, a spokesman for the American Federation of State, County and Municipal Employees, said the budget would "force a cascade of negative consequences," including possible facility closures.

Illinois' backlog of unpaid bills also is expected to grow as the state puts off paying its vendors, particularly those that provide health care to state employees. That backlog was at $4.7 billion earlier this month, according to the comptroller's office. That's down from nearly $10 billion four years ago.

Rep. John Bradley, a Marion Democrat and chairman of the House Revenue and Finance Committee, called the spending plan "not the best case scenario or the worst case scenario."

"This is a budget which reflects exactly what we can do this year," Bradley said. "It's cobbling together a budget we can without any kind of tax extension."

Cullerton said the legislature will have to look at other revenue options after the November election, whether it's extending the full tax hike, a smaller decrease or other changes to tax policy.

"In some fashion we'll need some revenues," the Chicago Democrat said. "It'll all be on the table."

Asked if he also believes a tax increase will be needed later in the budget year, Madigan said "not necessarily."

"I plan to work into the summer on the budget and when we get into the fall and into January I'll assess the situation at the time," he said.

Opponents of the budget bills said the process was rushed and lawmakers who received a copy hours before Tuesday's vote didn't get enough time to properly review the plan.

"This budget is hundreds and hundreds of pages," said Rep. Dennis Reboletti, a Republican from Mundelein, "and we go through the pomp and circumstance to pretend that everyone who voted yes on this bill had a chance to amply read every bill and line item."

• Daily Herald Staff Writer Marty Hobe contributed to this story.