State lawmakers offer up surplus of uncertainty

$13B HOLE | Budget leaves groups that rely on state aid in dark

Saturday, May 29, 2010

SPRINGFIELD -- Unable to resolve the state's deficit, Illinois lawmakers last week approved a state budget that offers taxpayers a surplus in at least one area: uncertainty.

From the fundamental question of whether spending will rise or fall to the details of which programs get money, legislators offered few answers.

They left it for Gov. Quinn to make many of the decisions about where to cut spending and how much. They also gave him the power to divert money set aside in special-purpose funds.

And legislators halted efforts to borrow nearly $4 billion for government pensions, suddenly adding a new drain on the pool of state money that already fails to cover government costs.

Groups that depend on state aid, including schools and charities, complain that they can't make decisions about personnel or services without knowing how much money they'll get and when.

Schools around the state have sent layoff notices to roughly 20,000 teachers and staff. They're not likely to reverse those cuts if they can't count on state money, said Ben Schwarm, associate executive director of the Illinois Association of School Boards.

John Tillman, CEO of the conservative Illinois Policy Institute, said budget uncertainty also hampers the state economy. Businesses don't want to invest in a state where government can't meet its obligations, bills don't get paid on time and a major tax increase may lie ahead.

"What this says is we don't know what our destination is and we don't even know how we're going to navigate our rudderless ship," Tillman said.

Legislators say it's the best they could do when the General Assembly wouldn't raise taxes and wouldn't slash spending.

Senate President John Cullerton said the budget leaves so many decisions to Quinn because he'll need maximum flexibility to manage the chaos. "It's almost like an emergency every day," Cullerton said.

The governor and legislators faced a stunning shortfall for the fiscal year starting July 1. The gap between likely income and expenses was roughly $7 billion and the unpaid bills from the current budget were estimated at $6 billion, for a total deficit of $13 billion.

Quinn wanted to cover part of the gap by raising taxes, but lawmakers refused to go along. Calls for dramatic spending cuts were also ignored. A proposal to borrow money fell a few votes short in the state Senate.

The governor has said nothing to suggest he'll veto the budget that legislators sent him, although he still hopes to win support for the pension-borrowing plan.

Unpaid bills means businesses and charities that provide service on behalf of the state aren't reimbursed on time for their work. They have to find money for employees and expenses without being paid, and many say they can't keep their doors open much longer.