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Fiscal Flushes: Illinois's budget is in the crapper

Did your July start off the right foot?

Chances are July 1 was a great day if you’re one of the 46,000 Illinois state employees who received a pay raise.

July 1 was likely a bad day if you work for (or benefit from) the twenty-six state government programs whose funding was reduced by Governor Pat Quinn.

July 1 was assuredly an awful day for taxpayers across Illinois, as the start of the new fiscal year brought few signs from statewide leaders that they’d seriously tackle our state’s growing budget mess.

Chances are you’ve heard of Illinois’s many fiscal woes. We spend too much. Our credit rating is in the crapper. The past-due debt file is overflowing.

Illinois government has real troubles with spending beyond its means, but state leaders won’t own up to it. They’d rather duck the issue by constantly coming up with new plans to push tax hikes, borrow like there’s no tomorrow, and ignore the problem and hope it goes away.

Governor Pat Quinn had an opportunity to confront our fiscal challenges head on with the start of the new fiscal year on July 1. As governor, he wields a mighty veto pen that could have struck hundreds of millions (if not billions) in low-priority spending from the legislature-passed budget plan. Instead, he passed up the chance to right fiscal wrongs by leaving the budget largely untouched.

The governor’s new budget “fix” indicates he’s living in a fiscal fairy tale. His spending adjustment recommendations do not come remotely close to balancing the budget, and he has failed to offer a clean break from the state’s perpetual fiscal mismanagement.

Consider this:

  • Compared to the legislature-approved appropriations bill (House Bill 859) for fiscal year 2011, Governor Quinn is reducing expenditures by just $155 million. That’s a reduction of less than one percent. The Department of Human Services spends five times that amount on labor costs and fringe benefits.?
  • On average, he is cutting the legislature-approved 2011 budget by $12 per Illinois citizen. In 2010, the state spent $2,040 per Illinoisan from general funds appropriations.?
  • The governor vetoed only one appropriation item from a 2,134-page appropriation bill. A mere twenty-six programs—out of hundreds—had their allocations reduced.?
  • The governor’s plan does not account for how the state will make its $4 billion pension contribution this year. Wishing and waiting for additional borrowing is not a solution.

Governor Quinn passed up a golden opportunity to make the sensible reductions necessary to align spending with available revenues. By kicking the can down the road once again, Illinois’s fiscal condition will continue to deteriorate to the detriment of Illinois families and businesses.??

Despite what Springfield politicians like to claim, balancing the budget can be done. The Illinois Policy Institute’s line-by-line alternative budget, Budget Solutions 2011, provides a clear path for balancing the budget and making the state’s pension contribution—all without a jobs-killing tax hike.

While it’s tempting to write off this year and look beyond the election, Illinois’s rapidly deteriorating financial position means we can’t afford a deny-and-delay approach any longer.

Kristina Rasmussen is the executive vice president for the Illinois Policy Institute.

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