During the week, a fiscal plan was introduced representing a package of seven bills that offer a full and balanced Fiscal Year 2018 budget that aims to protect the state’s highest priority programs, rein in spending, and eliminate two-thirds of the state’s backlog of unpaid bills.
The plan proposes selling revenue bonds totaling $6 billion to tackle the state’s backlog of unpaid bills – saving the state millions of dollars in late-payment interest costs. The package also includes a hard-spending cap of roughly $36 billion in general funds. Furthermore, the balanced budget proposal calls for a 1:1 ratio when it comes to spending cuts and revenue enhancements. For example, if lawmakers want to increase revenues by $1, they need to also look to cut spending by $1.
The budget plan provides full funding for the school-aid formula, and holds MAP grants for college students at their current level. It incorporates many of the budget-balancing measures proposed by Gov. Bruce Rauner in his February budget address, including $1.3 billion in pension reform savings, selling the James R. Thompson Center in Chicago, and restructuring the state employee group health insurance program. Additionally, the proposed budget includes new across-the-board cuts totaling nearly $800 million.
While the budget plan seeks to build on the Senate’s recent efforts to negotiate a budget buoyed by critical structural reforms, unfortunately that spirit of bipartisanship was not extended to reforming the state’s pension system.
On March 29, Senate Democrats ensured two pension reform measures introduced by Senate Republican lawmakers failed to advance out of a Senate committee.
In recent weeks, the Governor and a number of House lawmakers pledged their support for the Senate proposals heard by the Senate Executive Committee this week. Supporters of Senate Bill 2172 and Senate Bill 2173 underscored there is nothing preventing Senate lawmakers from moving forward on areas where there is agreement—such as pension reform. They emphasized the building support for the proposals should be seen as a positive development and a significant platform upon which consensus on other critical issues could be built.
The measures reflected the language and intent of previous pension reform legislation agreed to by both Republican and Democrat legislators last summer. The package incorporates pension reform concepts that have been supported by both Gov. Rauner and Senate President John Cullerton.
However, the proposals were held in committee by Democrat legislators, despite urging from proponents who stressed positive action on the measures provided an opportunity to form the foundation for positive budget negotiations moving forward.