A behavioral ecologist might see an uncanny resemblance to a struggle for alpha male status in a pack of timber wolves. Political scientists and headline writers prefer a titanic clash of egos to determine who’s the No. 1 Democrat in Illinois.
Whatever one’s frame of reference, the failure of the state’s Democratic leadership to produce a budget on time for the coming fiscal year is clearly a source of considerable embarrassment for the party faithful.
Entrusted by voters with the reins of government in Springfield just two years ago, Democrats blew it. Despite a governor and majorities in both legislative chambers, the party was unable to craft a spending plan for FY 2005 by the May 31 deadline. Now, the dysfunctional Democrats must call on responsible Republicans to keep state government going for the next 12 months because, come June 1, the Constitution requires a three-fifths majority vote in both the Senate and the House to enact the budget.
The party’s titular leader, Gov. Rod Blagojevich, places blame for the debacle squarely on the doorstep of House Speaker Michael Madigan.
Everything would have been peachy had Madigan and other Democratic lawmakers simply rubber-stamped the spending plan the governor laid out in February or the modified version cobbled together by Blagojevich and Senate President Emil Jones in the waning hours of Memorial Day.
But the speaker — at heart a fiscal conservative — was genuinely concerned about the huge spending increases and the dubious borrowing and revenue-raising schemes Blagojevich set out. And no doubt he grew tired of seeing the governor treat the legislature — an institution to which Madigan has devoted most of his adult life — as his personal piñata, to whack around at will. So a refresher course in Government 101, the part about there being three, co-equal branches of government, might have seemed in order.
Whether the governor sets aside his cudgel for an olive branch is anybody’s guess, and as long as the stalemate is resolved before early July — when it would start to impact the lives of everyday Illinoisans — the egg on the Democrats’ collective faces should cause the party no permanent damage.
But once a final budget deal is reached, a couple of points seem clear:
• Because the need for extraordinary majorities makes Republican leaders Sen. Frank Watson and Rep. Tom Cross equal partners in the budget-making process, the budget will reflect Repub-lican priorities more than would an all-Democratic plan. So expect less overall spending and smaller tax and fee increases than Blagojevich wanted and Senate Democrats approved.
• Whatever the final mix of revenue enhancements — tax hikes, fee increases, bond sales, raids on treasury accounts earmarked for uses other than general operations, and accounting gimmickry — lawmakers will face the same challenge a year from now. The underlying problem is not amenable to such one-time, stop-gap, Band-Aid solutions, as the gradual unraveling of the state’s current financial plan illustrates.
To help close a projected $5 billion budget deficit and bankroll nearly $1 billion in new general funds spending, Blagojevich and lawmakers last year approved a similar hodge-podge of new and higher taxes and fees, unprecedented borrowing, sales of state-owned property and draining earmarked funds into the state’s checkbook account. In the last 11 months, however, significant portions of the administration’s fiscal house of cards have collapsed, punching huge holes in the supposedly balanced FY 2004 budget. Among the major difficulties:
• Legal problems attendant to the awarding of the 10th riverboat casino license cost Blagojevich $350 million he was counting on for the current year. The license money probably won’t be available in FY 2005, either.
• Mortgaging the Thompson Center in Chicago for $200 million faltered when the attorney general opined that three-fifths legislative majorities were needed to authorize such long-term debt, a margin the plan failed to garner in the Senate.
• A federal judge blocked an attempt to siphon into the general funds $125 million from an environmental trust fund.
• Higher taxes on existing riverboats are now projected to bring in $100 million less than anticipated a year ago.
• A plethora of new and increased fees is likely to fall at least $70 million — perhaps more — short of estimates, and that’s assuming the underlying legislation survives a lawsuit challenging the constitutionality of raising fees on certain businesses beyond regulatory costs, then using the excess to pay day- to-day government operating expenses.
The revenue shortfall might be offset by a huge jump in federal aid — $1.2 billion more through May — due chiefly to a temporary hike in Medicaid reimbursement rates and a $422 million windfall in federal grants, both part of the tax cut package Congress approved last year.
Even were all those one-time revenues available to cover FY 2004 bills, an equal amount of new dollars would be needed from somewhere else just to stay even in FY 2005, much less spend more as Blagojevich wishes.
The governor, meanwhile, continues to rule out what many thoughtful people — including the presidents of the AFL- CIO and of the Illinois Chamber of Commerce — see as a reasonable approach, a temporary income or sales tax increase. One excellent suggestion comes from the Taxpayers’ Federation of Illinois, which in March coupled a proposed temporary income tax surcharge with a call for a Task Force on State Revenues, which the federation said should “study possible changes in state tax policy that would promote economic growth and adequate funding of government services.”
Until such constructive ideas take root, budget-making won’t get any easier as the governor and the legislature continue to skirt the underlying problem — a revenue structure that does not generate enough money to pay for the goods and services the politicians want to provide. o
Charles N. Wheeler III is director of the Public Affairs Reporting program at the University of Illinois at Springfield.
Charles N. Wheeler III is director of the Public Affairs Reporting program at the University of Illinois at Springfield.
Illinois Issues, June 2004
