Legislative Update- July 15, 8pm

 

July 15-8pm
The General Assembly passed 3 bills (SB1292, SB1912, SB1216) that create a state budget based on cuts and borrowing. The budget plan would include more than $3.5 billion in borrowing to make pension payments, $1 billion in cuts and $1.1 billion in potential further cuts by having agencies hold money in reserve.
The IFT issued the following press release:

No budget solutions from Springfield

Statement of IFT President Ed Geppert, Jr.

 

            The General Assembly’s failure to find consensus on legislation that truly addresses the state’s budget crisis is beyond disappointing. What happened today is like jumping into a life raft only to find it is headed towards Niagara Falls. Illinois still faces a budget crisis, one that will continue to grow with the debt created from additional borrowing.

            Vital state services will still take a tremendous hit. Employees face layoffs and programs will have to be cut back. Education programs still face over $400 million in cuts and we have no way to replace over $1 billion our schools received this year from the federal economic stimulus.

            There is a solution and it is House Bill 174--which would fully fund public services, protect jobs, invest in education and provide tax relief to seniors, homeowners, and those hardest hit by the recession. HB 174 is the blueprint to avert budget disaster and restore responsibility to government.

            The bill passed out of the Illinois Senate and those Democratic senators who voted for the bill put the needs of their constituents before political posturing. We call on the leadership and members of the House of Representatives to reach a consensus and pass this bill or legislation that is similar.

 

July 15- noon
Legislative leaders and the governor met again Tuesday evening to negotiate a budget plan. According to the Associated Press, "Lawmakers described a budget plan that would depend on even more borrowing and financial maneuvering to paper over the state's record-breaking $11.6 billion deficit. Then officials could review the budget late this year or early next year to see whether more spending cuts or a tax increase would be needed."

This version would include billions of dollars of financial gimmicks and one-time sources of revenue: borrowing about $3.5 billion to help pay annual pension costs, using about $1.1 billion worth of vaguely defined "inter-fund borrowing" and leaving about $3.2 billion in bills unpaid.

SB 1292 has been amended (floor amendment 3) and now contains the language on pension bonding. The bill previously contained language creating a 2-tier pension system. That language has been removed. 

Update from July 14

The governor and lawmakers met today in Springfield to try and work out a compromise on the state budget crisis. Their morning meeting was followed by closed-door meetings of all 4 legislative caucuses where lawmakers had a chance to debate possible budget solutions. Various media reports said lawmakers were looking at legislation that will allow the state to borrow approximately $3.5 billion in pension obligation notes. The state will issue bonds and use the borrowed money to make part of the pension payment this year to free up other revenue for social service providers. The state will still be paying the full amount into the pension systems. Lawmakers are expected to vote on budget bills tomorrow. 

The IFT will file an amicus curiae brief supporting a lawsuit filed by the American Federation of State County and Municipal Employees (AFSCME) to force the government to keep paying state employees if a budget agreement isn't reached. This "friend of the court" brief provides valuable information about legal arguments, or how a case might affect people other than the parties to the case. A hearing on the case will be held tomorrow afternoon in Madison county.