Rauner Lays Out Budget Plan; Democrats Not Impressed
As Illinois staggers on – threatened and rudderless without a budget for the bulk of the past two years – Gov. Bruce Rauner on Wednesday was tasked with laying out a fiscal path forward.
“Now is the time to seize the moment – build on the progress made in recent weeks – and right our ship of state. Together, we can make Illinois more competitive and more compassionate. We can make the necessary changes to fix our broken system,” he said.
As he stood before a joint session of the Illinois House and Senate, some Democratic legislators had signs on their desks reading “Rauner Budget = Fake News.”
Absent any changes, Illinois is staring down a $7.2 billion hole.
Rauner’s vision calls for spending $37.3 billion – a decrease from this year – but still above the current projected revenues of $32.7 billion. The governor presumes to fill that $4.6 billion gap by piggybacking on the stalled bipartisan “grand bargain” negotiated by Senate leaders – even as he spent part of the speech spurning elements of that package.
His proposal calls for filling the remaining, $2.7 billion of that gap largely by getting the recalcitrant Democratic-controlled legislature to go along with changes that include the creation of a new, optional 401(k)-style pension plan for state employees and selling the James R. Thompson Center, the Chicago seat of state government. The plan also calls for implementation of his version of a new contract for state workers who are members of the union that represents most state workers, the American Federation of State, County and Municipal Employees Council 31.
AFSCME is voting though Sunday on whether to authorize a strike in protest of Rauner’s contract terms, which call for a wage freeze and having employees to pay more for their health care.
“Most Illinois families have seen their health insurance premiums skyrocket. Business owners across the country are forced to make hard decisions to manage soaring health costs. So imagine what Illinois families think when they hear our state employees get ‘Cadillac platinum’ coverage for barely more than bronze rates,” Rauner said.
“We cannot continue to ask taxpayers to pay more to subsidize state employee health care when they’re seeing their own premiums go up and coverage go down.”
Though Rauner’s budget director Scott Harry says the governor prefers to work with legislators on those policies, there is an alternative: Give Rauner the unilateral authority to cut the state budget. Under that scenario, Harry says everything is on the table, save for early childhood intervention, K-12 education and funding the state’s annual pension payment and debt service.
All of this received barely a mention during Rauner’s actual speech; most of those figures were outlined afterward by Harry, or can be gleaned from a 571 page online budget document.
Rauner’s address itself was laden with projects that would cost more money: Increasing money for education with $30 million more in general state aid (enough to give each school enough money to spend $6,119 per student) as well as additional funds for early childhood and bilingual education, districts’ school bus transportation costs, and outfitting classrooms with internet. Giving the state health department $1.6 million for opioid abuse prevention and for a new system to track overdoses, as well as dollars to help schools test their pipes for lead and to assist families whose children have accelerated levels of lead in their blood. Among other projects: paying to train and hire 170 new Illinois State Troopers; staffing a new Chicago veteran’s home.
“It sounds like he’s talking about adding lots more spending. We already don’t have enough revenue for the spending we’re currently doing,” said Rep. Greg Harris, D-Chicago.
Lawmakers were irked that they weren’t briefed on actual details prior to – or even after – Rauner taking the podium.
The lack of specifics – and heavy reliance on a Senate plan which he partially panned – led Democrats to describe Rauner’s budget effort as an “executive deflection.”
“I thought it was a very long way of saying, ‘I’m sorry teacher, I didn’t do my homework.’ The governor did not present a balanced budget. All he talked about with any specifics was increasing spending. I can’t wait to hear how large the Rauner income tax hike is going to be,” said Sen. Don Harmon, D-Oak Park.
“I don’t think the governor has the political will to specify cuts to programs. He never has. He talks about vague savings here, and savings there. But when it comes to cutting specific programs that benefit people who live in the state of Illinois, he’s missing in action. He’s happy to let other people do his work for him. But his job is to present a balanced budget,” Harmon said.
Rauner has continually gone out of his way, as he did during the budget speech, to praise efforts Democratic Senate President John Cullerton and Senate Minority Leader Christine Radogno have put into crafting a still-shifting “grand bargain.” That 12-piece package covers ground ranging from hiking the state income tax rate to 4.99 percent to doubling the number of casinos and from fulfilling a Rauner request of making it easier for municipalities to merge to easing the state’s procurement rules.
“We’ve made a point of letting the Senate move forward … trying not to disrupt momentum. But I’d like to take a few minutes to help guide the negotiations to a place where Democrats and Republicans can reach agreement, and I can affirm my support for the package,” he said. “First and foremost: the final result must be a good deal for taxpayers and job creators: a grand bargain that truly balances the budget once and for all, and really moves the needle when it comes to job creation.”
Though he’d refused to weigh in on specifics prior to Wednesday, Rauner used his speech to delineate a few parameters.
Rauner says the Senate plan’s temporary property tax freeze should be made permanent – a difficult notion given schools’ reliance on property taxes, and which immediately drew criticism from municipalities. And though he says he will agree to putting a sales tax on certain services, he said he will not go along with adding a sales tax to groceries and medicines. The governor further called for a “hard cap” on state spending.
A spokesman for Cullerton says talks between he and Radogno on the “grand bargain” will continue.
“Today the Governor also acknowledged the great deal of groundwork that has gone into negotiating a package that can pass in a Democrat-controlled Senate and encouraged us to keep working. We can now consider the Governor’s advice in our discussions as we move forward,” Radogno said in a statement. “We want what the Governor wants – a bipartisan compromise that is a good deal for the taxpayers.”
Her statement did not embrace or otherwise comment on Rauner’s criterion; nor did the statement issued by Cullerton, which simply read: “Right now the Senate is working on this year’s budget because there isn’t one. We need to restore stability and sanity to Illinois’ finances. That begins with a budget for the here and now. That’s what the Senate is trying to do.”
House Speaker Michael Madigan likewise did not take questions from reporters, and merely released a statement in reaction to the address.
“Throughout my time in state government, legislators and governors from both parties have agreed that the state budget must be a priority. While the House has passed a number of budget bills to fund critical services for seniors, children and public safety, it appears that for the third straight year Governor Rauner has failed to introduce a balanced budget,” Madigan said.
The address itself was sprinkled with a series of noticeable interruptions, including a technical blip when Rauner’s teleprompter stopped working.
“As our economy grows, and revenues expand … oops. I just lost my words there … Does anyone have a paper copy?” Rauner said toward the end of his remarks.
Attorney General Lisa Madigan handed him a copy – evidently in small print.
“Wow. I don’t have my reading glasses for this one. Thank you. I’m a little old for this type,” he said, prompting laughter from legislators and the audience in the House galleries.
Speaker Madigan – who stood in his traditional place alongside Cullerton behind Rauner at the podium – must have made a quip, as Rauner went on to joke: “Speaker says it’s the Russians.”
The floor once again lit up – a rare time when laughter was directed with, not at, the governor.
Democratic legislators continually hooted sarcastic remarks as Rauner – who is mostly self-funding an Illinois Republican Party that has spent millions running commercials and otherwise publicly striking both Madigans and many Democratic legislators – asked for bipartisan cooperation.
“This isn’t about pointing fingers or assigning blame,” he said, as Democrats snickered.