Daily Herald opinion: State seeing welcome financial trends, but caution is still warranted

This editorial represents the consensus opinion of the Daily Herald Editorial Board

In recent years, Illinoisans have become accustomed to bad news on the state's finances, so it's natural to feel a little skeptical about reports of a newly robust budget outlook.

Even so, can we take a moment to, if not celebrate, at least acknowledge figures suggesting the state may be approaching the brink of financial stability?

We have been in the forefront of those fretting that a surge of spending amid a windfall of federal pandemic revenues may not bode well when the federal money goes away. And we're not yet ready to break out the noisemakers and party hats.

Who but a purely partisan critic can be cynical about two successive years of budget surpluses, resulting in hundreds of millions of dollars in contributions to the struggling pension system, billions in paydown on interest-accruing debt, the creation of a $2 billion rainy day fund and even a bit of tax relief?

Republican Tom Demmer, a former state representative from Dixon and no particular friend to policies pressed in recent years by the governing Democratic Party, was not shy about recognizing the state's newly impressive ledger.

"It is genuinely surprising to see not just a slight revision upward, but really multiple consistent revisions upward in what we think we're going to collect this fiscal year. That's really unprecedented," Demmer told Capitol News Illinois for a report this week.

Let's not be naive. Much of the good news comes because tax hikes have produced even more revenues than expected and spending as the pandemic wanes has produced booming sales tax income. And, Gov. J.B. Pritzker himself acknowledges that the appearance of surpluses has much to do with the management of revenue expectations. Moreover, as Demmer also pointed out, prospects for spending growth could quickly threaten all the current good news - a concern shared by Democratic Comptroller Susana Mendoza.

Amid clear delight with the current revenue picture, she nonetheless added to CNI, "What I would be opposed to is seeing new funding items - unless you can really sell that this is an extreme necessity for the state at this time - we want to stay away from funding new programs that are going to have to be funded year to year."

So, no, we are not yet prosperous, and there are plenty of uncertainties and dangers ahead that could quickly turn our present circumstances around. But we're better prepared for an unexpected crisis than we've been in 20 years, and at least to some extent, Pritzker and the General Assembly are using our current good fortune to address long-standing problems.

In less than two weeks, the governor will present his budget for the coming year to the General Assembly. While we have little doubt about his willingness to propose bold initiatives, we hope that whatever he has in mind, he continues to base it on the conservative revenue expectations that have laid the foundation for the good reports of the last two years.