Under Governor Bruce Rauner’s proposed FY2016 budget, one of the largest sources of state funding for local governments in Illinois would be reduced by half. The reduction is part of more than $4 billion in spending cuts and $2.2 billion in estimated pension savings recommended by the Governor to close a projected budget gap of over $6 billion in fiscal year 2016. Local governments in Illinois…
Governor Bruce Rauner’s recommended budget for fiscal year 2016 includes a new plan for reducing the State of Illinois’ massive pension costs. As discussed here, the plan could cut the State’s unfunded pension liability by approximately $25 billion and save $2.2 billion on pension contributions from general operating funds in FY2016, according to the budget proposal. Proposed legislation on the…
Alongside his first operating budget proposed for the State of Illinois, Governor Bruce Rauner also recommended a capital budget for FY2016 that proposes shifting previously vetoed spending authority to pay for delayed maintenance at State owned facilities across the state. As previously discussed here, former-Governor Pat Quinn vetoed the remaining $250 million from the FY2015 capital budget…
The State of Illinois reduces its operating resources by more than 25% annually to provide individuals and businesses tax benefits through exemptions also known as tax expenditures. In FY2013, the most recent year that data have been reported on tax expenditures, the exemptions in Illinois totaled $8.4 billion, which would have increased State-source General Funds revenues of $31.9 billion by 26…
Prior to the release of the Governor’s annual budget recommendation, the Institute for Illinois’ Fiscal Sustainability at the Civic Federation releases an analysis of the State of Illinois’ fiscal condition and proposes a comprehensive five-year plan for achieving long-term fiscal sustainability for the State of Illinois. This plan responds to the dire reality of Illinois’ financial condition…
At the end of December, the Illinois Auditor General released the State Actuary’s annual report on the actuarial assumptions and valuations of the State’s five pension funds. In its report, according to State law, the State Actuary must evaluate whether the pension funds’ actuarial assumptions are reasonable. In prior years, the actuary has expressed reservations that three of the funds’ assumed…
The State of Illinois projected a major loss of income tax revenues in FY2015 due to the reduced rates for individuals and corporations that took effect on January 1, 2015. However, corporate income taxes have taken a steeper decline than originally projected and began to fall even before the rate declined to 5.25% from 7.0% halfway through the fiscal year. The December 2014 monthly revenue…
The fate of a proposal to use more than $5 billion in new federal funds to overhaul the State of Illinois’ Medicaid program remains unclear as a new gubernatorial administration takes office in Springfield. As previously discussed on this blog, the five-year proposal focuses on developing more community-based alternatives to institutional care for individuals with disabilities, including…
According to a recent study, the State of Illinois does not set aside enough revenue to account for fluctuations in its volatile tax sources and needs to improve its rules for making rainy day fund deposits in order to prepare for future financial challenges. The extensive report includes an in-depth study of the last 25 years of State revenues, previous legislation intended to establish a rainy…
A drop in Illinois’ income tax rates—and uncertainty about the implementation of pension changes—could cause the State’s backlog of unpaid bills to grow to $9.9 billion by the end of the 2016 budget year, according to a new forecast by Governor Pat Quinn’s office. Along with the decline in income tax revenues, the three-year projection for the State’s general operating budget through FY2018…
