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And now the fun begins on the budget with one week to go

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The Illinois Statehouse is in a state of paralysis. The Illinois General Assembly has a self-imposed deadline of May 31st to pass an annual budget that would start on July 1st. But, a key vote and an even more significant non-vote this week showed just how hard crafting a budget for the upcoming state fiscal year will be.

The biggest news this week was that Illinois Governor Pat Quinn and Speaker of the House Michael Madigan were not able to get the 60 votes needed to make an income tax hike scheduled to sunset in January permanent. There were rumors that it may have been as many as 26 votes short of passage. The House is key because the entire body is up for reelection in November and no state representative wants a recent tax increase vote on their record.

So, the alternative was to call a vote on what was called a “doomsday” budget. It would not include any revenue from the income tax extension and would trigger $3 billion in reductions, mostly in education and social services and probably create delays in paying past due bills. When this was taken to the floor for a vote yesterday it failed by an astounding roll call of 5 to 107.

In essence, the House doesn’t want the tax increase, but also doesn’t want a reduction in services. The pickle is that no one this week stepped up with an alternative. The options they will deliberate on starting on Monday will be:

MAINTENANCE BUDGET

This is not rare. It has been done before when a Budget Session does not get resolved until after a new fiscal year starts. It essentially results in paying bills on an “as needed” basis. Funds are allocated at their current levels. It could also result in the backlog of severely past due bills to start to creep or catapult back up. But, it could be the quickest way to end the impasse. Do a maintenance budget now and address the income tax issue in the fall Veto Session.

GRADUATED INCOME TAX ROLLBACK

The General Assembly could try to get a vote that would reduce the current income tax rate back to the 2011 level over time. This would lessen the possibly draconian reductions in education and social service funding in the 2015 state fiscal year to a more palatable levels.

MAKE QUINN DO IT

The General Assembly could send a framework budget to Governor Quinn and have him selectively make the cuts needed to get to a balanced budget. With his own election looming in November, it would be shocking if Quinn would agree to this. Almost any cut he made would hurt him with one of his core constituencies. It would be tantamount to a Democratic Party controlled legislative body would hand the governor’s mansion to a Republican (in this case Bruce Rauner).

The key is that the General Assembly decided to adjourn for the holiday weekend. If it was at a pure stalemate, they would have stayed in Springfield over the weekend.

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