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Gridlock continues in Springfield, even after the close of the legislative session.
On June 10, State Representatives Robyn Gabel and Laura Fine gave an end-of-session report to about 75 residents at the Ecology Center. The meeting had to be postponed twice because the legislators continue to travel to the State capital in hopes of crafting a budget before June 30, the end of the State’s fiscal year. Among their other positions, Rep. Gabel chairs the Human Services Committee and Rep. Fine chairs the higher-education appropriations committee.
The Governor’s Budget
The State mandates that both the governor and the legislature propose and approve budgets in which the anticipated revenues meet the expected expenditures. The budget proposed by Governor Bruce Rauner is $32 billion, said Rep. Fine, “which is what he said the income would be.” She said, though, “The governor was counting on $2 billion from [a favorable] Supreme Court ruling on pensions.”
In light of the Supreme Court’s decision, which held that the State’s pension reform law is unconstitutional, Gov. Rauner’s budget has a $2 billion shortfall on the revenue side.
On the expenditure side, the governor’s proposed budget covers mandatory expenditures for such things as pensions, debt service and health insurance for public employees. It also contains many cuts to human services and educational-support services, such as reductions in services to homeless children, changes in the benchmark at which children with disabilities receive services [the determination of need] and reductions in funding for higher education.
“In the budget are so many devastating cuts that I was unwilling to vote for it,” said Rep. Fine. She said Gov. Rauner’s own financial strategists, whose salaries cost the taxpayers about $30,000 per month, have said, “You can’t balance the budget on cuts alone.”
“We decided to put together a budget we thought was reasonable,” said Rep. Fine, adding that, as an example, “We proposed a 6.5% cut to higher-education funding,” rather than the 31% cut proposed by Governor Rauner.
Senate Bill 1 – the 2015 version of last year’s Senate Bill 16 – is dead, said Rep. Fine. In editorials as well as in several articles, the RoundTable pointed out inequities in the bill and flaws in its calculation formulas that, had the bill passed, would have reduced State funding to Evanston’s two school districts by about $9 million annually.
“What happened is that the experts said, ‘Until you figure out the tax structure in Illinois, you cannot pass Senate Bill 1,’” said Rep. Fine.
Rep. Fine said her committee is proposing to fund each school district at 92% of what it is entitled to receive under current formulas – and then pro-rating any remainder among the poorest school districts. Right now, she said, the funding is at 89%.
Rep. Gabel said changing the determination of need for children with developmental disabilities will put additional burdens on local school districts. At present, “children who are diagnosed as having a 30% delay are now eligible for support services,” she said. The governor’s budget proposes raising the eligibility requirement to 50% before they are eligible for services. “That will end up costing the school districts a lot of money,” she said, because many more children will be entering kindergarten unprepared and in need of services.
One resident asked about Gov. Rauner’s proposal to permanently freeze property taxes at their current level, absent a local referendum. “Why is he talking about a property tax freeze? I don’t understand the relevance of that. … If he wants to control the library, he should have run for the Library Board.”
Rep. Gabel said the governor has “linked the property tax freeze with contract negotiations and prevailing wages – linked it with ways local governments can reduce their costs by anti-union strategies.”
In a separate interview, Rep. Gabel told the RoundTable the governor “understands that if you freeze property taxes, then you have to give cities something else.” She said the governor is offering two types of relief: one to diminish the strength of collective bargaining and another to override the mandate to pay the prevailing wage in State contracts. This would eliminate the requirement that local governments pay a decent wage to middle-class workers.
As an example, she said, a firefighters’ union “would not be able to control the number of personnel a city would have to hire.”
Another proposal by Gov. Rauner is to reduce the proportional share of income taxes the State remits to local governments. These moneys are called local government distributive funds (LGDF).
“If you eliminate the LGDF and freeze property taxes, what’s going to happen to our schools?” Rep. Fine asked. The City of Evanston could lose about $3.7 million annually in LGDF. A property tax freeze would limit the amount the School Districts could levy, reducing their revenues even further. For example, if a property tax freeze became effective on July 1, District 65 would lose a little more than $25 million in revenues over the next five years.
Questions From Residents
One resident asked about the probability that organizations that had received grants from the State would in fact receive the money.
Without a firm, direct answer, Rep. Gabel said, “We have to be patient and we have to be careful.”
Another resident asked if there is a possibility that the income-tax rate would be increased from 3.5% to 5% – as it was last year – “or is that dead in the water?”
“I don’t think anything is dead in the water,” said Rep. Fine.
Local activist Jeff Smith said, “A lot of what the governor is proposing has nothing to do with the budget. … He’s trying to de-fund strong, Democratic-funded institutions.” Saying former Governor Patrick Quinn was willing to sign a bill restoring the tax increase before he left office in January, Mr. Smith added, “What’s the point of getting a Democratic majority if it puts us in a place we didn’t want to be in?”
Apparently speaking in support of the governor’s proposal to reduce workmen’s compensation benefits, a resident said that a moderate-sized business that relocated to Indiana could save about $3 million per year.
“We know our spending proposal asks for more money than we have – we’re negotiating,” said Rep. Fine.
Rep. Gabel said, “We are willing to go down to Springfield as much as we need to, to make this work.”