Illinois' stopgap budget actually makes economic outlook worse

The recent passage of a six-month unbalanced spending measure will worsen Illinois' financial problems and likely lead to a massive tax increase. I voted against the unbalanced stopgap bill because the Illinois General Assembly needs to cut unnecessary spending, not raise taxes.

The approval of a stopgap measure is nothing more than a continuation of the status quo that has made Illinois insolvent. The stopgap bill is a spending plan, not a real balanced budget. Consider this - about 91 percent of state government spending was on autopilot during the budget stalemate. The state has been spending money at levels that are higher than authorized during Gov. Pat Quinn's administration. Spending continues to be out of control, especially for public employee pensions and Medicaid.

Enter the stopgap measure. Nothing has really changed. The General Assembly still has not done anything to address the pension crisis facing Illinois. It also still has not done anything to rein in out-of-control state mandatory spending. In fact, the General Assembly has done just the opposite and has doubled down on out-of-control spending.

The state currently has a backlog of about $8 billion of unpaid bills. That budget deficit is going to grow with the passage of the stopgap bill. We are spending money we do not have and adding to our budget deficit every day that goes by without enacting the kind of reforms that are needed to get our finances in order.

The stopgap bill includes no real reforms or real spending reductions. In fact, the stopgap package includes up to $625 million of additional money for Chicago Public Schools (CPS) through a combination of up to $375 million of additional state funds for CPS and $250 of additional property taxes. The stopgap bill also increases K-12 education funding by $524 million without requiring any of that money to be used for property tax relief. Amazingly, the stopgap bill also reduces the funds in the state's million rainy day fund by $275 million.

With the adoption of the stopgap measure, we are ensuring the state's financial problems will not be addressed anytime soon. Ultimately, we are guaranteeing that the state's financial health will get much worse, which will make it easier for a tax increase to build momentum in Springfield.

So where do we go from here?

First, we need to reamortize the pension debt to give the state more time to make required annual contributions to the pension funds. The amortization schedule imposed on the pension systems based on a 1995 law is arbitrary and can be changed. Restructuring the pension debt could reduce the annual required contribution by more than $2 billion a year over the next few years. If we restructure the state's pension debt and couple that as a first step with the meaningful pension reforms Senate President John Cullerton has proposed, we could free up meaningful money in the short-term and be on our way toward a real, long-term solution to the pension crisis.

Second, we need to freeze Medicaid spending levels while protecting everyone below 150 percent of the poverty level. Illinois is only receiving 50 cents from the federal government for every dollar spent on Medicaid. Some states are receiving more than 60 cents on the dollar. We need to aggressively pursue federal waivers and pursue other innovative ways to bring in $500 million to $1 billion a year of additional federal money into the Illinois Medicaid system. We also need to complete a private audit and eliminate Medicaid waste and fraud.

Finally, we need to reduce the cost of Illinois government. We need to consolidate unnecessary and duplicative government programs and agencies and find ways to run state government more efficiently. We also need to reduce state group health insurance costs.

I will keep fighting to stop tax increases. However, the adoption of the stopgap budget does not make that task any easier. The path to producing a balanced Illinois budget should be focused on cutting spending, not driving more people out of the state by raising taxes.

Illinois state Rep. David McSweeney is a Republican from Barrington Hills.