By: Ted Dabrowski and John Klingner

The Illinois General Assembly has finally passed an emergency budget for 2021 after not being in session for two months. Tax revenues have taken a severe hit due to the impact of the shutdown in response to COVID-19, yet that hasn’t stopped lawmakers’ spending priorities. 

The state will spend a record $42.9 billion while bringing in just $36.8 billion. 

Lawmakers are counting on a combination of federal loans and grants to fill the official $6 billion deficit. It’s important to keep in mind that the state’s deficit is several billion dollars larger when the true costs of the state’s retirement costs are included.

Lawmakers did not include any potential revenues from Gov. J.B. Pritzker’s proposed income tax increase in the budget.

Here’s what you need to know about the 2021 budget numbers:

1. Record spending. The state plans to spend $2.5 billion more than its most recent 2020 spending estimates, a 6.2 percent increase. The new budget spends $42.9 billion in 2021 vs. the estimated $40.4 billion in 2020. That’s the state’s largest budget ever.

2. A $6 billion deficit. Lawmakers plan on spending far more than the $36.8 billion the state estimates it will take in. Income and sales taxes will be the most impacted by the shutdown. The deficit for 2021 totals $6.1 billion.

3. No cuts, no furloughs. The budget contains no government worker salary cuts or employee furloughs to provide tax relief for Illinois’ struggling private sector. State AFSCME workers are scheduled to receive a raise in July, even as more than one million Illinoisans are unemployed. In contrast, other states across the country are cutting operational costs. California, for example, recently announced plans to cut worker salaries and public education by 10 percent. 

4. Counting on a bailout. The legislature expects to access a $5 billion short-term loan from the Federal Reserve to plug the majority of the deficit. Lawmakers are hoping they’ll be able to use federal grants from the not-yet-passed HEROES Act to repay the loan.

5. Retirement costs swallow more spending. The 2021 budget spends $11 billion on official state retirement costs. That will consume almost a third of the state’s own-source revenues.

6. The deficits aren’t what they say they are. Lawmakers might say the 2021 deficit is $6.1 billion, but the real number is far larger. True actuarial pension costs would add another $4 billion to the budget, while retiree health insurance costs would add at least $2 billion more. It’s this kind of accounting that’s led to the massive debt build up over the past three decades.

7. No reforms. The budget contains none of the reforms Illinois needed long before the coronavirus arrived. The pandemic makes them even more urgent. Lawmakers have seemingly forgotten the 22 downgrades slapped on Illinois over the past decade by the big three rating agencies.

8. Pay raises for politicians. No need to say much here. Lawmaker pay raises happen automatically, and the legislature passed no law to stop them this year. There’s some debate over whether the raise will actually happen. If it does, the $1,800 yearly raise will push salaries to $71,000 – already the fifth-highest in the nation.

**********

Never mind the state of the economy, the record unemployment  and the continuing COVID-19 crisis. With this budget, lawmakers have created an even bigger burden on the state’s private sector.

Some lawmakers argue that a record budget is needed because of the crisis. For sure there are essential parts that need more resources to deal with the pandemic, but that doesn’t mean that the rest can’t be delivered more cheaply. Public sector pay cuts and furloughs are needed to provide relief for the millions of private sector residents who have been devastated by the crisis and must pay for those public services.

There’ll be plenty more to say about this budget over the next few days and months, but consider it just the next step in Illinois’ long-running mismanagement…more borrowing, no cuts and big deficits. And this time, hope for a bailout.

Read more about COVID-19 and the impact on Illinois:

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Poor Taxpayer
4 months ago

Illinois is nothing but a PONZI SCHEME.

Let the last person pay off everyone.

The rest get out while you can salvage any money for your house.

Start a new better life in another state, any state is better than Illinois.

Illinois “Land Of Slavery”

Susan
4 months ago

Illinois political class is successfully deploying the Bell California gambit: seize effective control of a government from a non-participatory population, then award yourselves whatever salaries/perquisites/entitlements you desire according to laws you are now legally empowered to design. There is no self defense against the Bell California gambit unless a bigger bully (Feds) can be found to muscle out the local crew. Capitulation is a potentially powerful strategy which has not been attempted in Illinois. 1. Every citizen should apply to every public job posted. If jobs are not posted as required by law, due to.nepotism/Patronage awards, aggregate affected taxpayers and… Read more »

MikeH
4 months ago
Reply to  Susan

https://en.m.wikipedia.org/wiki/City_of_Bell_scandal

A bit of background. The parallels to IL state govt cannot be denied.

Poor Taxpayer
4 months ago

Lincoln Freed the Slaves, the greedy cops, teachers and firemen put slavery back in business. Illinois “The Land of Slavery”.

s and p 500
4 months ago

Stacy Davis-Gates has dollar signs in her eyes and says “we need to think about how to close equity gaps”. Does that gap include $12 billion in unfunded CTU pensions?

https://thenotebook.org/articles/2020/05/27/school-districts-use-a-variety-of-tactics-to-keep-learning-on-track/

Mike in Madison
4 months ago

i am shocked that the state of IL in good conscience can ask for a 6% increase in total spending during a time of high unemployment and likely price deflation in the short term

MikeH
4 months ago

The fools in charge have none.

John
4 months ago

The first chart has a typo in it. Is should state “2021 General Fund Budget (in millions)” rather than billions. A 6,058 billion dollar deficit would be 6.05 trillion.

Sue
4 months ago

#3 – Why would you lump cuts to public education in with wage commentary? Is your view that public education is just another failed government program and thought a potshot in here would land nicely?

Tom Paine's Ghost
4 months ago
Reply to  Sue

Public Education where there are Teachers Unions IS just another failed government program. IFT, NEA and CTU are deeply greedy self-serving organizations who impede education at the expense of lining their pockets with cash. If you dont believe it then look at Wisconsin’s significant increases in student test scores after Governor Walker busted all public sector unions in 2012.

Last edited 4 months ago by Tom Paine's Ghost
James
4 months ago

Correlation, causation or a statistic simply illustrating the case at one particular time? Such things have to be considered.

Tom Paine's Ghost
4 months ago
Reply to  James

Just eyeballs and plain common sense are all that is required. I’ve seen CTU members in action. My kid’s private school K to 8 non-union teachers who’s contracts renewed each year were incredible. Many of his CPS High School selective enrollment CTU teachers were also incredible. But 1/3 were phoning it in and a few were downright zombies. One copied her CTU union representative on all correspondence with me the parent. Disgusting. They were the “best of the best”? The highest paid public school teachers in the nation? I’d hate to see the “B” team, the “C”team and worse. Throwing… Read more »

Last edited 4 months ago by Tom Paine's Ghost
Admin
4 months ago
Reply to  Sue

Sue, please see the attached graphic.

Illinois-already-spends-30-to-50-percent-more-than-its-neighbors-on-education1-1068x542.png
James
4 months ago
Reply to  ted dabrowski

Your statistic results to a good degree from IL having far, far more school districts than most (all?) other states and paying higher admin costs per pupil as a result. That’s a decades-long problem that is hard to correct with small towns wanting local control of their schools and resisting larger districts that reduce it. If you cherry-pick that situation you’ll find some of those small districts pay HUGE salaries to their superintendent exacerbating the case I’ve stated here.

Susan
4 months ago
Reply to  James

CUSD 200 in Woodstock is typical example of profligacy by ‘consolidated unit school district ‘ spending enormous amounts on administration whether needed or not.

Consolidation of districts also results in the lower elementary school salaries rising to the higher level of high school salaries.

Woodstock D200 spending per pupil is over $15,000, with performance metrics mediocre at best.

James
4 months ago
Reply to  Susan

I agree with your comment except that some who read it may conflate two separate ideas being automatically bound together as one. Yes, it true that in cases where you have elementary districts consolidatng with a local high school district that the elementary teacher salaries almost always rise to the higher salary schedules of the high school district, decidedly not a cost-saving consequence. But, let’s not necessarily think that’s the only way consolidation can be done. Adjoining elementary districts can consolidate as well in which case the former district with the lower salary schedule probably converts to the higher salary… Read more »

Susan
4 months ago
Reply to  James

I didn’t articulate my point properly:
Unless the consolidated district is Required to reduce administrativespending (and I don’t think such a requirement is possible), the district will Not reduce administrative spending.
This belief is based upon my own observations.

James
4 months ago
Reply to  Susan

I don’t know that your “Not” is the right word, but I imagine you’re right maybe 85% of the time, and there’s likely minimal savings as the years go by and other administrative staff members are added as well. Voters are somewhat to blame here in that its a common perception that people having school age children want the best schools possible. That leads to people wanting to live there and bid-up local home purchase prices, something the local home owners generally prize. It may, or may not, be true in the sense of a reasonably good correlation that more… Read more »

Susan
4 months ago
Reply to  James

The good schools = higher home values is fallacy after a certain property tax rate inflection point is breached. In Woodstock that argument is party line, and parroted by willfully ignorant useful idiots who decline to look at evidence, and who insist on speaking nonsensicalgeneralities rather than verifiable specifics. Because of tax rate capitalization, our home values decline ~3% annually relative to homes all over America, because property tax rates average ~1% in America vs. 4% in Woodstock. (The quality of schools snd other tax-supported social service provision here is mediocre at best, so the additional3% of home value taxationis… Read more »

nixit
4 months ago

For those who profess the quality and intelligence of Capitol Fax commenters:

“Budget roundup” post detailing historically unbalanced budget with unprecedented revenue shortage yet overwhelmingly approved by Democrats: 7 comments

“Always zoom out on crowds” post making fun of downtown conservative protest: 55 comments

If there was any doubt as to their bias – and there isn’t – this is it.

David Ford
4 months ago

The sound of a toilet flushing,thats what illinois politicians are doing to illinois,everyone should leave this state as fast as you can!

Susan
5 months ago

Illinois class stratification defines two distinct categories: those who can begin collecting pension benefits a decade earlier than social security, the amount of those benefits will be 300%-400% or more than social security, the employees’ contributions toward said benefits are less than 4% (often zero) of salaries (as opposed to 2nd class citizens’ 6.2% contributions to social security for the same 10 years plus an additional decade), and a big one: free health insurance at early retirement mid-fifties….versus second class Illinois citizens obligated to pay for these first class citizens’ entitlements and who have no safety nets for their own… Read more »

UnclePugsly
5 months ago
Reply to  Susan

We were told that in the last election women on the North Shore and in the NW suburbs think the right to infanticide is more important than the economy or taxes so that’s why they vote Democrat.

Flash413
5 months ago
Reply to  Susan

Most people are free to enjoy life to the fullest at about age 66. The entitled, more special animals get to do so up to 15 years earlier.

Greg G.
4 months ago
Reply to  Susan

Would you care to point out which state employees are paying “0” dollars into the retirement systems? You can’t and you know it! Why don’t we ever hear about the unfunded liability of the money Illinois spends on criminal aliens?

Susan
4 months ago
Reply to  Greg G.

Cps requires only 2% of salary paid by teachers. The rest (7.2%) is called “pick-up” and is paid by taxpayers. Teachers are exempted from social security contribution requirements.

Outside Cps, most the collar county schools require taxpayers to pickup the entire required contribution for teachers (currently 9.2% of salary).

Compare that to a nurse who is required to pay 6.2% of salary to social security.

https://www.trsil.org/news-and-events/pension-issues/districts-picking-up-members-trs-contributions

The Truth Hurts
4 months ago
Reply to  Susan

The “pick up” is/was negotiated at the local level and is part of their overall compensation package. Would you rather the teachers negotiate for a higher salary instead of this benefit? Keep in mind their pension would then be calculated based off this higher salary.

Mike in Madison
4 months ago
Reply to  Susan

As part of “Act 10” in Wisconsin in 2010, all government employees in the entire state (local, county and state employees) are required to contribute half the annual cost of their pension, and that works out to around 6% of salaries.

Erin Simmons
4 months ago
Reply to  Susan

It’s criminal!

Tom Paine's Ghost
4 months ago
Reply to  Susan

I am curious if you know the overall population numbers of this First Class of criminal citizens? How many workers in Illinois are Public Sector Union members leeching off of the honest taxpayers? Out of Illinois 2020 estimated 12.5 Million population what percentage is this cancer that is destroying the rest? BTW I suspect that the current 2020 12.6 million census estimate is grossly wrong and that in fact Illinois population has declined far more significantly. IL Democrats supress and deny any population loss. When IL loses THREE congressional seats and three electoral college votes the declining insignificance of the… Read more »

Susan
4 months ago

I believe the number of public school teachers in Illinois is 135,700 in 2013.
That is roughly 1% of Illinois total population.
If you consider the working age population ( ~70%) then teachers represent 1.5%.

James
4 months ago
Reply to  Susan

So, what’s a reasonable guess as to the total of all IL state public employees presumably around 2/3-3/4 of which might eventually be drawing pensions from one of the five state-supported pension systems–3%, 4.5% or what? Then, how many of those who do eventually draw such a pension will do so as full-career workers in their respective pension systems rather than having served for shorter durations such as maybe 8-15 years at most? These are questions for all to ponder. Its my guess that the full-career pensions are fewer in number than one might suppose, part of the original reason… Read more »

Susan
4 months ago
Reply to  James
The Truth Hurts
4 months ago
Reply to  Susan

Back of the envelope math. Take it for what it’s worth. Illinois has roughly 600k active public pension members and about 375k inactive members. That’s a lot of voters when you add in their spouse/family who benefit from the current system. It is estimated that 13% of the retirees have moved out of state. Even if 20% of the total members moved away you still have around 800k plus family living in Illinois that benefit from the system. If 70% of these people are married that’s 1.36 million voters or about 39% of the 2014 voters or 30% of the… Read more »

James
4 months ago

Thanks, you’ve done a great overview of the situation.

Tom Paine's Ghost
4 months ago
Reply to  James

Exactly the numbers that I was seeking. You are spot on that each Public Sector Union leech has a wife, kids, uncle, and worthless son-in-law or two who are also tagging along at the ballot.

Poor Taxpayer
5 months ago

Pension

Lawrence A Wyllie $321,443.52 Started 2013-06-29

https://pensions.bettergov.org/

Freddy
5 months ago
Reply to  Poor Taxpayer

Look up Leslie Heffez. He is #1 in the state with a pension of approx $628,000/yr. Will collect almost $21Million by age 85. All this from contributions of $775K probably paid for by the university as a benefit. Taxpayers for the most part are on the hook for the pension and students thru tuition for his salary and perks.

Linda
5 months ago

the mismanaged pensions continue to wreck Illinois, contributions need to increase and payouts need to be readjusted! No private pension plans pay out more than you made while working! Your contributions over the years should have balanced out the return.

The Truth Hurts
5 months ago
Reply to  Linda

Of course pensions have been mismanaged. That’s what happens when you don’t make actuarial required contributions to fool taxpayers into thinking there is no problem. Don’t worry though as contributions are increasing. We are still climbing the Edgar pension ramp so our contributions will continue to rise. Taxes will be increased so that we can make the increased payment. Payouts are also readjusted 3% each year.

Freddy
5 months ago

I agree that the required contributions were not made by the state on a regular basis which exacerbated the problem but taxpayers were making the required payments year after year thru property and other tax’s. The money was “diverted” to other things like political pet projects or higher salaries/health insurance/or just deferred/etc. I do not recall ever seeing a reduction in my tax’s reflecting lower pension obligations that are not made. All my tax’s are higher year after year. Its like if I make a car payment but the execs at the lender gave themselves raises instead of reducing my… Read more »

The Truth Hurts
5 months ago
Reply to  Freddy

Every time the state chose to not use your tax dollars to fund pensions and instead spend it on pet projects they were increasing the debt load of the state. So yes you paid your required taxes but it wasn’t enough based on what the state was spending. It’s more like you buying a car and the finance company telling you your payment is $300 but the interest expense is $400 per month. Sure you’re making your payments but you were actually increasing your debt owed to the finance company the entire time. You (the taxpayer) didn’t care because you… Read more »

Freddy
5 months ago

Thank You for clarifying!

nixit
4 months ago

What if the pet project was employee raises?

bagelgirl
4 months ago

Pensions are underfunded because the benefits have grown 8 times faster than personal income of the taxpayers. Taxpayers cannot keep up with the rapid and uncontrolled growth of pension liabilities. Pension funds are at risk of insolvency because they are misaligned with the tax base.

Mike
4 months ago

This point was made elsewhere in this comment section but let’s say it a different way. The benefit levels and salaries determine how much should be contributed annually to the pension funds. The benefit levels and salaries are the glass. The glass comes first. The annual contributions are the water. The water come second. The water gets poured into the glass. In Illinois, the glass is growing faster than the water. Illinois did everything wrong. It’s always been Opposite Day in Illinois. The state politicians kept hiking the benefits, providing funding for salary hikes, and not making actuarial required contributions… Read more »

bagelgirl
4 months ago

The benefits have been too much for taxpayers to afford, so nearly all of the funds are underfunded and at risk of insolvency. Pension benefits have grown 8 times faster than the personal income of the tax base. The taxpayers cannot keep up with the rapid and uncontrolled growth of pension liabilities.

The Truth Hurts
4 months ago
Reply to  bagelgirl

I suggest you go back and read point #6 in the article above. Even when the state makes statutory payments to the pension funds they have not been making the actuarial required payments. This has been going on for years and it is a fact not an opinion. The pensions were funded around 40% all the way back in 1970. I suggest you learn about the Edgar pension ramp for further details. Not only did the state not contribute the full actuarial payment but then the pension funds missed out on the growth those additions would have provided. The pension… Read more »

Admin
4 months ago

Right. Yet the press will report, and politicians will say, they made “full pension contribution” which is actually only what the legislature itself decided to contribute. It doesn’t even keep the pensions at tread water levels — the unfunded liability grows and grows.

Mike
4 months ago

The Tier I overly generous benefits in the State pension funds are still being offered to those who began their career prior to January 1, 2011.

The Truth Hurts
4 months ago
Reply to  Mike

They are not offered anymore. Those employees received that offer when they started prior to 2011. You are referring to an existing contract.

Mike
4 months ago

“We no longer offer them.”

So your definition of “offer” refers to employees hired on or after January 1, 2011.

The point I was making is that employees hired prior to January 1, 2011 are receiving the hiked benefits and will continue to accrue and receive the benefits until they and any covered beneficiaries decease (or the benefits are somehow reduced in the future).

The pension and retiree healthcare benefits are dictated by state law (Public Acts), not an existing contract.

Or maybe your definition of an “existing contract” is a Public Act.

Last edited 4 months ago by Mike
The Truth Hurts
4 months ago
Reply to  Mike

Pensions are “enforceable contractual relationship, the benefits of which shall not be diminished or impaired”. They are a contract. It’s not my definition but rather the Illinois Constitution and confirmed by the Illinois Supreme Court. Pension and retiree healthcare benefits are NOT dictated by state law after the employees first day of employment. Once the state offers those benefits (already approved by state law) to the employee they can’t be reduced by the legislature. The ILSC has ruled that employees have a right to the benefit calculation that was offered to them on their first day of employment. They based… Read more »

Mike
4 months ago

Let’s go through this sentence by sentence. “Pensions are ‘enforceable contractual relationship, the benefits of which shall not be diminished or impaired’. They are a contract. It’s not my definition but rather the Illinois Constitution and confirmed by the Illinois Supreme Court.” – A “contractual relationship” is not a contract. If you want to call them contracts fine, but they are found in the Public Acts which come from the legislative process in the Illinois General Assembly; as opposed to collective bargaining agreements. Collective bargaining agreements are commonly referred to as contracts. No one refers to Public Acts as “contracts.”… Read more »

Mike
4 months ago
Reply to  Mike

Thinking about the words “contractual relationship” in the state constitution. Here’s the pension sentence in the state constitution. “Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.” http://www.ilga.gov/commission/lrb/con13.htm Basically The Truth Hurts is stating the General Assembly writes pension and retiree healthcare contracts when they pass pension and retiree healthcare legislation into law. That may well be the case and is a disturbing thought to look at it in… Read more »

The Truth Hurts
4 months ago
Reply to  Mike

These are the words of the Illinois Supreme Court not mine. First, it makes “membership in any pension or retirement system of the State” an “enforceable contractual relationship.” This contractual relationship, we have explained, “is governed by the actual terms of the Pension Code at the time the employee becomes a member of the pension system.” The protections afforded to such benefits by article XIII, section 5 attach once an individual first embarks upon employment in a position covered by a public retirement system, not when the employee ultimately retires. Second, the clause provides that the benefits of the contractual… Read more »

Mike
4 months ago

That’s common knowledge among those that are familiar with the subject.

What’s not common is referring to Public Acts as contracts.

In fact it’s highly unusual.

When pension and retiree healthcare legislation is passed into law, perhaps it is appropriate to call them Public Act Contracts.

But just calling them contracts is too confusing.

Contracts in the public sector labor arena typically refers to collective bargaining agreements (cba).

The Truth Hurts
4 months ago
Reply to  Mike

A contract is a binding agreement between two or more persons or parties that’s legally enforceable. Pensions more than satisfy that definition. I have read several stories calling pensions contracts for quite some time. In fact quite a bit of this was done by people advocating for the reduction of pensions during the last reform. Even this website has made the argument that if the pension clause is removed from the Illinois constitution then it could be reduced just as other contracts have been based on an extreme need. This is not my definition but rather one that has been… Read more »

Mike
4 months ago

Tier 1 benefits are for those covered by a “state” pension and retiree healthcare system and employed prior to January 1, 2011. Tier II benefits are for those covered by a “state” pension and retiree healthcare system and employed on or after January 1, 2011. Here is the sentence in the constitution. “Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.” The pensions are determined by a formula that… Read more »

debtsor
4 months ago
Reply to  Mike

“These are the words of the Illinois Supreme Court not mine.”

The Supreme Court got this wrong. End of story. Their view is legally binding, but unfortunately, completely wrong. These supremes get things wrong all the time…That’s the end of the story. Bankruptcy would solve this problem.

Rita Grimes
5 months ago

We would all be in trouble if we handled our finances like that. Yet they give themselves a raise. THEY should get to vote for their own raise. THEY are employed by THE PEOPLE. THE PEOPLE should make that decision. PEOPLE who handle finances like that shouldn’t be in charge. VOTE THEM OUT!!

Poor Taxpayer
5 months ago

Illinois is GONE and SO SHOULD YOU.
Just leave as soon as you can. Start a new better life somewhere else.
You will thank yourself and so will you family.
Best of luck where ever you go, it will be much, much better than Illinois.

debtsor
5 months ago

This is the definition of irresponsibility. The very definition of it. And it will totally blow up into a full blown fiscal crisis in 10-12 month. It’s baked in the cake. I think they all know this too, if only we had microphones to hear the private discussions these people are having. Yet they still pass it. They may all know this is the end too – Madigan is almost 80 and about to be indicted; there’s a new Senate leader, Biden is the only candidate possibly worse than Hillary, no one has any political inertia to bailout profligate IL.… Read more »

The Truth Hurts
5 months ago
Reply to  debtsor

There will be no “full blown fiscal crisis in 10-12 months”. You’ve shortened your timeline by 3 months. More borrowing and taxation on the way. That’s all that will happen in the next 10-12 months.

debtsor
5 months ago

No amount of borrowing and no amount of taxation will dig us out of this hole. It’s too big now. And they aren’t even being honest with us how big it is.

UnclePugsly
5 months ago

@TTT I upvoted you because I think you are right – taxpayers will be ground to a pulp before Democrats do anything different. This is what the majority voted for.

Douglas
5 months ago

My edited pic says it all. Suprising, it wasn’t that hard to make that head fit on that body in editing–was like it naturally belonged.

EV1V8WkWkAAQsRG.jpeg.jpg
Last edited 5 months ago by Douglas
RSDuke
5 months ago
Reply to  Douglas

“I’ll tell you how I feel about Illinois, Jerry: it’s a waste of time. Bunch of people runnin’ around bumpin’ into each other, got a guy up front says, ‘2 + 2,’ and the people in the back say, ‘Progressive income tax.’ Then the bell rings and they give you a carton of milk and a piece of paper that says you can go take a dump or somethin’. I mean, it’s not a place for smart people, Jerry.  I know that’s not a popular opinion, but that’s my two cents on the issue.”

Manfred Downstate
5 months ago
Reply to  RSDuke

That’s perfect: “Bunch of people runnin’ around bumpin’ into each other, got a guy up front says, ‘2 + 2,’ and the people in the back say, ‘Progressive income tax.’” That is exactly what’s going on: I sometimes argue with a “progressive” Chicago friend of mine about the Illinois predicament. She acknowledges the pension and fiscal crisis (the 2 + 2) but then she jumps to the JB-certified answer, “progressive income tax,” because it’s always OK to tax The Rich. She herself has not filed an Illinois income tax return in years because all her income is from IRAs, a… Read more »

Flash413
5 months ago

Tell your “progressive” friend that there is nothing progressive about greed.

MikeH
4 months ago

Funny thing is, it’s a paraphrased rant about high school. And when you think about it, Illinois is just HS for grownups. And neither are places for smart people.

Mike
5 months ago

Paraphrasing the article, the State pension and retiree healthcare contribution is $6B (38%) less than actuarial required. Someone will claim that a full pension contribution was made. That refers to a full statutory contribution, not full actuarial contribution. State Representative, Senators and Governors have for decades played that game, with basically complicit unions and management. They complain a little but not too much. That’s because lower contributions to pensions and retiree healthcare means more money available to hike salaries and current healthcare benefits, with the added benefit that a hiked salary results in a hiked pension. The thought seems to… Read more »

Admin
5 months ago
Reply to  Mike

Press is already making that error again. Tribune, Daily Herald and probably others. They just don’t care about getting the story right. It’s been going on for years.

Goodgulf Greyteeth
5 months ago
Reply to  Mark Glennon

Pritzker, and all too many “journalists”, remind me of Walt Kelly’s Pogo character, Fremont the Boy Bug. Fremont was running for president. Problem was, Fremont responded to every question about how things were going with the same two words. In fact, Fremont only knew two words: “Jes fine.” Which, for Governor Tax Cheat and the all too often uncritical, if not openly lickspittle, media works great in Illinois. “Governor, how are you and your party’s financial and governance decisions working out in fixing Illinois’ bankruptcy of finances and governance?” “Jes fine.” “Mr. Newspaper Editor, how do you think the Governor… Read more »

Last edited 5 months ago by Goodgulf Greyteeth
Mike
4 months ago
Reply to  Mike

The following May 6, 2019 Wirepoints article estimated the FY 2019 State of Illinois budget shorted the annual state pension contribution by $5B and the annual state retiree healthcare insurance contribution by $3B, for a combined $8B shortfall. https://wirepoints.org/warren-buffet-is-right-to-avoid-illinois-the-states-true-retirement-costs-now-total-50-of-annual-budget/ The estimate used a 6% investment return instead of 7% and used a 100% funded status by 2045 (instead 90%). The unfunded liabilities keep growing because actuarial required contributions (ARC) are not being made. In other words we keep pouring more water into the glass, but the glass is growing faster than the water. Illinois law has always allowed that to… Read more »

Sherry Balzer
5 months ago

For the governor to be able to use federal funds from the HEROS Act to repay the is unacceptable and totally wrong. Why is there a total of $3,872 billion in repayments? Someone needs to do a serious audit on the state of Illinois. If the governor can have a deficit of $-6,058 billion, and I’m sure it’s a lot higher, and not be held accountable, no wonder they feel it’s ok to spend money so freely. I would like to know where these repayment loans are going to. Are any of these repayment loans belongIng to companies affiliated to… Read more »

Illinois Entrepreneur
5 months ago

I think Pritzker has a larger agenda here. I think that he is attempting to show the public union brass and rank and file that he’s got their back no matter what. Shoot, if he’s honoring raises during the worst economic calamity in 100 years, they know that he will give them everything they want in the future. In exchange, when he runs for president, he will call in the favor to all of the national public sector unions. They will endorse him for the primaries, and then he’s on his way to the general election. If Illinois ends up… Read more »

Rob Maitino
5 months ago

This is a bust out, just like on the Sopranos. You borrow until the credit runs out, then torch the place for the insurance. Planned bankruptcy. They’re hoping for a Biden win in November, and a Dem majority in the Senate. With Dem control of the legislative and executive branch, a bailout will likely be in the offing. It seems defects mean nothing now, for both parties actually. 96-0 vote on CARES act. Drumpf signed it willingly. Very little went to people who actually needed it.

Flash413
5 months ago

With unlimited unions dollars to advertise “Tax The Rich” it will go through. If Biden wins and the senate goes blue, Illinois will get bailed out. JB will have been saved by the Wuhan bell. He will have enough federal money to raise the COLA’s to 5%.

Last edited 5 months ago by Flash413
Mark Felt
5 months ago

“The state will spend a record $42.9 billion while bringing in just $36.8 billion.”

I will be impressed if the state brings in 35 billion at this rate.

Goodgulf Greyteeth
5 months ago

Governor Tax Cheat is only too willing to regulate the private sector Payday Loan industry, even though he relies on the guvm’nt payday-loan bond market to camouflage Illinois’ pestilential bankruptcy of finances as a “balanced budget.” Governor Everlasting Jobstopper knows that unlike private-sector Mr Everyman, he’s not going to have to sign over a lien on his car or his home mortgage to get more money than he can afford to repay, thereafter submitting to the obligation to pay usurious penalty fees to avoid loosing the roof over his head, or his vehicle. The parasitic bond markets will give JB… Read more »

DantheMan
5 months ago

The Wirepoints community know Illinois is getting closer to the edge, but the average Illinois resident will gloss over this news and think everything is under control. This sham budget may have bought you and your loved ones a little more time to get organized and get out. Once the average resident becomes aware of what we already know, it will be too late to get out. Everyone will consider selling their homes at that point but there will be zero demand to buy. Many Illinois residents consider themselves stuck because of health issues, or kids, or jobs. In reality,… Read more »

Indy
5 months ago
Reply to  DantheMan

Exactly. The short term pain and inconvenience of moving to another state is worth it to spare your family unimaginable pain & suffering.
Staying in Illinois is beyond selfish and naïve.

Poor Taxpayer
4 months ago
Reply to  DantheMan

You will be able to get rid of Herpes easier than selling a home in Illinois.

If you stay you will be enslaved the to the Greedy Government Employee and their HUGE PENSIONS.

accept reality
5 months ago

Pritzker’s strategy to use the pandemic as a lever to bail out an insolvent IL has FAILED. All that remains is how he will blame Trump.

Richard Brroberg
5 months ago

I am sure the money will disappear as soon as it arrives.

NB-Chicago
5 months ago

Ted, isn’t the $5 billion short term loan from fed reserve, if granted, only supposed to used for covid related expenses? Or an i confused

Admin
5 months ago
Reply to  NB-Chicago

It’s pretty broad. From the Municipal Liquidity Facility (MLF) FAQ: What can the proceeds of the Eligible Notes be used for? An Eligible Issuer may use the proceeds of the Eligible Notes purchased by the SPV for the following purposes: (1) to help manage the cash flow effects of income tax deferrals resulting from an extension of an income tax filing deadline; deferrals or reductions of tax and other revenues or increases in expenses related to or resulting from the COVID-19 pandemic; and requirements for the payment of principal and interest on obligations of the Eligible Issuer or its political… Read more »

NB-Chicago
5 months ago
Reply to  Ted Dabrowski

Thank you!!

NB-Chicago
4 months ago
Reply to  NB-Chicago

Point is, seems state will at least have to make an attempt to show, as minimally as that may be, that what $5 billion fed loan is spent on is in some way covid related. So, would that provide pritzker & team impetus to jack up covid stats to give state more leeway on what to spend the $5 bill on? Also, not nessesaraly part of budget but another gigantic debt issue, illinois is approved for highest in nation–$12.6 billion fed loan, if needed, for unemployment compensation. All of which would have to be paid back. And i believe illinois… Read more »

Illinois Entrepreneur
5 months ago

“Some lawmakers argue that a record budget is needed because of the crisis.” And some more argue that a record budget is needed when times are good, so things can get done. They never argue for fiscal conservatism. It’s always more. The only way this nonsense will stop is when the bond market refuses to further enable them. The problem with that is I’m guessing there are a few more layers of risk that bondholders will tolerate for those juicy interest returns (upwards of 10, 12%). Then eventually the state’s interest on the debt and the pension payments will just… Read more »

nixit
5 months ago

How is a budget with a $6 billion deficit better than no budget?

Indy
5 months ago

Starve the Beast.
NO BAILOUTS for Illinois or Chicago.
Also its time for the credit rating agencies to grow a pair & downgrade Illinois.