Winters Belatedly Responds to Budget Plan
1 comment February 22nd, 2008
Press release from Rep. Dave Winters, R-Shirland:
On Wednesday, Governor Blagojevich delivered his State of the State, or SOS, address to inform the public of the affairs of the state and his proposals for the spring legislative session. But his unusually short speech was extremely vague and provided no real picture of our state’s true financial condition. He camouflaged the fact that Illinois is facing another kind of SOS - a warning for a state drowning in debt.
The fact is that Illinois is sinking. Because of the Democrats’ insatiable appetite for spending, the budget under the Blagojevich administration is growing faster than incoming revenue. As a result, our state is behind in paying more than $1.7 billion in bills to service providers. Many of these liabilities are owed to nursing home and healthcare professionals who offer help to Medicaid participants! His failure to pay is not only sending our medical providers into debt, it is forcing some of them to deny treatment to patients.
A recent report from the Commission on Government Forecasting and Accountability found that due to a downturn in the national economy, the current Fiscal Year 2008 revenues will fall short of estimates by $600 million. To top it off, Treasurer Alexi Giannoulias announced investment income will fail to meet expectations this year by an additional $38 million to $50 million. So it seems our fiscal ship is foundering, even before we begin negotiating an FY09 budget.
Over the last 5 years, the Democrats who control all branches of Illinois government have paid for their “credit card” philosophy by raising fees and taxes, by borrowing, and by using one-time gimmicks. This has created an insurmountable structural deficit. In that time period, they have increased spending by $5.2 billion, or 23 percent. And our general obligation bond debt has risen from 7.6 billion in Fiscal Year 2002 to 19.8 billion in Fiscal Year 2007.
Unfortunately, Illinois faces even greater challenges in FY09. Early estimates show only a $500 million to $700 million growth while Medicaid needs alone will likely reach $700 million, and another $700 million is needed to fulfill our state pension obligations.
Yet the governor in his SOS message proposed more tax-and-spend initiatives for which he has become notorious. Most of the schemes he proposed were recycled from previous years, including new taxes on employers to pay for a healthcare expansion, fund sweeps, and a lease of the state lottery.
While the Governor talked about cutting taxes on businesses, the reality is the governor plans to provide a one-time tax cut of 300 M, while pushing for a $1.2 billion tax increase on employers which will last year after year. Currently, the state’s unemployment rate is 5.2 percent – the 13th worst in the nation. Raising taxes on businesses that create jobs for families will only make matters worse and contribute to a slowing state economy.
Leasing the state lottery was proposed by the governor during his address, which is a scheme that has been rejected by the General Assembly over and over again. He would use a large portion of the proceeds for the sale to pay for a capital construction program. While I am pleased the he supports the prospect of a capital plan to pay for road improvements and school construction, leasing state assets such as the Lottery is only a quick fix and will cost the state approximately $40 billion in education funding in the long run. We must explore other options to generate revenue for a capital program which is extremely important to create new jobs, boost our economy, improve state facilities, and provide better classrooms for students.
Illinois is certainly facing harsh economic times, but now is the time to confront them before the state is completely swamped by debt. The way to do that is to stop introducing new spending plans and program expansion, start paying our bills, and introduce measures to stimulate job growth and ignite the economy. I’m sending out an SOS to the governor and my Democrat colleagues in the General Assembly – help save our state. Join me and other House Republican members in choosing fiscal responsibility this spring.
