Senate Week in Review: Nov. 9-13
SPRINGFIELD — Illinois’ financial woes made national news this week when a respected think tank named it one of the top 10 states in financial crisis, according to state Sen. Dale Risinger, R-Peoria.
In other news, Gov. Pat Quinn announced a plan to bail out the Regional Transit Authority that would rely on additional borrowing and general revenue funding, while state universities continue to report economic troubles as a result of delayed state reimbursements.
A report issued by the highly respected Pew Center on the States placed Illinois’ budget among the 10 worst in the nation, because of the substantial difference between the amount of revenue Illinois takes in, and the amount the state spends. Illinois’ 47.3 percent gap between revenues and spending was second only to California.
Risinger said that although state revenues in Illinois are down since the beginning of the recession, revenues have not dropped as significantly as in California and other states. In fact, the study shows that tax receipts in Illinois are actually marginally better than the national average.
Illinois’ $13 billion budget deficit was also reported to be among the three largest in the nation — the result of overspending the last seven years, and a primary factor in Illinois’ poor ranking. The study highlighted that “the state’s current budget still relies heavily on borrowing and paying bills late.”
The report noted that because the state already had a substantial deficit before the national recession, it will be even more difficult to regain fiscal stability. Pew Center experts said the road to financial recovery won’t be easy, noting the situation was exacerbated because “the state piled up huge backlogs of Medicaid bills and borrowed money to pay its pension obligations.”
Risinger said this is unfortunate, but not unexpected. The state’s deficit was made worse by massive program expansions pushed by former Gov. Rod Blagojevich and approved by majority Democrats during his six years in office. Gov. Quinn and legislative Democrats have left Blagojevich’s programs and policies untouched — including some that led to his impeachment.
This week, a deal between Gov. Quinn and the Regional Transit Authority was announced, which would allow the RTA to bond approximately $160 million over two years to give to the Chicago Transit Authority to help fill an annual $300 million shortfall.
Although the state is billions of dollars behind in payments to Medicaid providers, service providers, and public universities — to name a few — Gov. Quinn has committed $32 million in state dollars over the next two years to subsidize the Regional and Chicago Transit Authorities.
The bail-out will freeze CTA fares at current rates for the next two years, though the CTA is still required to make $100 million in operations reductions, either through service cuts or layoffs.
Risinger notes that the funding will come out of General Revenue Funds, meaning all state taxpayers — from Cairo to Galena — will be subsidizing Chicago-area mass transit. Good government groups, editorial boards and some transit authorities say that the deal is irresponsible, and only creates more debt for the RTA without actually addressing the CTA’s massive deficit.
The bail-out could have been avoided if Gov. Quinn would have supported income-based limits on the controversial Seniors Ride Free program, which could save an estimated $37 million. Instead of limiting the free rides program to low-income senior citizens, the Governor and his Senate Democrat colleagues refused to advance a means testing program, thus allowing high-income seniors to continue to ride free — while working men and women from across Illinois pick up the tab.
The state’s troubles are also still continuing to cause problems for state universities. Recently, both the University of Illinois-Urbana/Champaign and Southern Illinois University-Carbondale said that late state reimbursements have become a serious problem.
This week, officials at SIU-Carbondale say they are concerned about making payroll, and representatives of SIU-Edwardsville report the university is making cutbacks and many operational budgets are being affected. Dispensable goods and services are being eliminated or scaled back, and campus officials said they are taking a serious look at their future planning and how the university will operate in the coming years.
