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Budget Session heats up with two weeks left

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With a goal of leaving Springfield on or before May 31st, the Illinois General Assembly is abuzz. As usual, a number of governance and political subplots are emerging. Some major ones came to light this week.

A BUDGET EMERGES

The reason they call the spring legislative session the Budget Session is because the main purpose is to craft a budget for the next fiscal year that starts July 1st. The structure of the 2015 fiscal year budget emerged Wednesday from the House and a cascade of appropriation bills were voted on Thursday. Here are some key components:

• It mirrors the budget Governor Pat Quinn presented in his March budget address that included a $500 per home property tax refund;

• It would include the 2011 temporary income tax increase as a permanent source of revenue;

• It would total approximately $38 billion;

• It would not trigger massive cuts to social services, public safety and education;

• A final version could include cutting the state’s corporate income tax in half, boosting the state earned income tax credit and change business tax credit programs impacting business attraction, ethanol production, and research and development.

But, the House plan will be challenged. GOP House members argue that because there has been no vote on making the temporary income tax increase permanent, a vote on a budget that includes that revenue would be unconstitutional. Even some Democratic members of the Senate are concerned about that. The big elephant in the room for all involved is that no legislators running for re-election want a tax increase on their voting record heading into November.

This fight will answer some of the biggest questions hanging over the Illinois Statehouse, which include:

• Could a budget be passed now with approval of the income tax change occurring during a “lame-duck” Veto Session?

• Could a “gloom and doom” budget be passed now and then be amended in the fall Veto Session that would include the income tax revenue?

• Will there be a “moment in courage” vote on the income tax change occur during this session?

Watching what happens on this is what the Illinois Statehouse insiders will be focused on over the next two weeks. Thursday, Illinois House Speaker Michael Madigan used a parliamentary rule to prevent the approved appropriation bills from automatically going to the Senate to buy some more time on which scenario is most doable. But, eyes will be on Governor Quinn Monday when he is expected to address the income tax issue on the House floor.

HOUNDS STILL AFTER QUINN

Governor Pat Quinn’s Neighborhood Recovery Initiative continues to cause his administration problems. A bipartisan, 12-member Legislative Audit Commission is expected to meet on May 28th on the $54 million anti-violence program that is under both state and federal investigations. Even if the legal investigations are dealt with quickly and Quinn is exonerated, this panel could drag on through the fall, much to the delight of Quinn’s opponent Bruce Rauner.

JACK DORGAN QUITS AFTER 1-TERM

The Illinois State Republican Party is about to make another change that essentially shows consolidation by and for GOP gubernatorial candidate Bruce Rauner. Current GOP State Party Chairman Jack Dorgan will not run for re-election today. He is moving on to work as a co-chairman for Rauner’s finance committee. Both Dorgan and Rauner support Cook County Commissioner Tim Schneider to replace Dorgan, who is expected to run unopposed.

AND THE COURT SAID WAIT A MINUTE

In what was expected by most Illinois Statehouse insiders, a lower Illinois court suspended the state’s pension reform law that was supposed to take effect on June 1st. Judge John Belz of the Sangamon County Circuit Court issued the ruling on the law that was projected to save the state $145 billion over 30 years.

Lawsuits buy labor unions and retired former state employees challenged the constitutionality of the law with the crux being that it would reduce retiree benefits. The decision will ultimately be decided by the Illinois Supreme Court. From a budget perspective, it will have no impact on the fiscal 2015 negotiation.

COOK COUNTY PENSION BILL

In other pension news, the framework for a Cook County pension reform bill is taking shape. The plan is rumored to reduce retiree benefits and require current workers to contribute more. The snag is that an additional $144 million in revenue needs to be generated to fully fund the pension system by 2034. The sources for that infusion (i.e. tax increases) have not been identified.

A lot of noise on this is expected next week. While Service Employees International Union Local 73 supports the framework, the American Federation of State County and Municipal Employees Council 31, which represents 4,000 county workers, opposes it.

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