The General Assembly has adjourned until after the election but several pieces of unfinished work should force the governor to call us back to Springfield this summer. Not only is the budget unbalanced and grossly overspending the state's resources but also the need for repairs to our roads, schools and infrastructure has grown beyond critical.
Like an alcoholic who puts off treatment until “tomorrow,” legislative leaders and the majority party failed the citizens of Illinois by putting off for yet another year the need to prioritize spending, reform unworkable programs and balance the budget. When I was young, people used to call this type of behavior “spending like a drunken sailor.”
State Spending Exceeds Available Revenue by Nearly $5 Billion
Article VIII of the state constitution leaves no doubt that the General Assembly “shall” pass a budget where proposed expenditures do not exceed estimated revenues. The governor, glad to get any budget from the legislature for the last fiscal year, did not challenge the fact that the expenditures exceeded revenues. He cannot ignore the imbalance this year.
Budget bills passed on purely party line votes last week called for spending increases of over $2 billion while revenue growth as projected by the Commission on Government Forecasting and Accountability totals only $520 million. Senate bills that would have increased revenue by more borrowing and sweeping balances from funds collected for special purposes were never debated in the House.
Normal government budgeting begins with an understanding of available revenue. As the House began debate over the budget, sponsors quickly set the ground rules that we weren't going to “worry” about revenue. I can understand why; it's dismal.
With the slow-down in the economy and fewer people gambling, tax revenues have been about $500 million less than budgeted. This fact means the FY2008 spending plan that began the year about $750 million over anticipated revenues will end the year about $1.25 billion more than revenue. But the spending plan has grown. More people are using the state's health insurance, medical costs are growing at a rate far above inflation and fuel price inflation is driving up the cost of just about everything the state purchases.
The backlog in bills waiting to be paid to our health care providers has now grown to about $2 billion. Providers must wait up to seven months to be paid and then their bill is arbitrarily discounted about 70%. While the governor thinks of more ways to expand eligibility for the state health plan, current patients are not being served and providers face either bankruptcy or turning away more state clients.
Add the expected new revenue with the increased spending, the backlog of bills, the lower 2008 revenue figure, the cost of new labor contracts now being negotiated and the $500 million shortfall in required pension payments equals nearly a $5 billion imbalance in the state budget.
A Formula for Improving Our Situation
Governor Edgar faced a similar fiscal dilemma to the current one, back in the early 1990s. His formula for climbing out of that financial hole could be used again.
First, tighten our belts and stop new spending. Second, make choices. Prioritize spending and modest increases to programs that produce the greatest benefits and serve people most in need. Third, reform the system—look for smarter ways of running government. What small business hasn't drastically changed the way they do business over the past decade to stay in business? Government should be no different. And finally, work together.
The FY2009 budget was prepared by Democrats in each chamber on a ‘take it or leave it' basis. That's why some of the revenue ideas weren't passed by the other chamber. Republicans weren't asked for their ideas or help in dealing with the current difficult situation. There is no monopoly on good ideas.
Perhaps your dad gave you the same advice mine gave me: play fair. Kindergarten teachers try to instill this value but apparently our legislative leaders missed that lesson. Many dads have said “Just because you're in the driver's seat, doesn't mean you have to run people over.” The citizens of Illinois just got run over.
A final word of advice to those expecting to be paid or receive program benefits from this budget-- someone will be left out. There isn't enough revenue, and health care providers and people expecting a state pension are tired of lending money to the state.
New Ethics Guidelines Approved by House
House Bill 824 passed both chambers last week and is headed to the governor, whose actions prompted the legislation. The bill prohibits state contractors doing more than $50,000 in state business from making campaign contributions to the officeholder who awarded the contract. This also includes campaign contributions to any declared candidate for the constitutional office that awards the contract.
In addition, the legislation prevents elected officials and other state appointees and employees from receiving fees related to legal, banking, and consulting work with state bonds. Bids for state contracts worth over $10,000 would be required to disclose all political contributions over $500 made within the previous 2 years to the officeholder that will award the contract.
These ethics guidelines target pay-to-play politics and should help ensure that the people of Illinois are being served fairly and ethically. Even as the bill was being debated, however, the governor has continued to hold campaign fundraisers targeted at people doing business with the state. While I wish the bill went further in reforming the conduct of our leaders, this is a step in the right direction.
Future of Clean Car Legislation Unclear
The sponsors of House Bill 3424 which reduces vehicle emissions and smog-forming pollution have been working to remove opposition to the legislation from a host of organizations. While the goals of the legislation seem beneficial, the unintended consequences on consumers and renewable fuels cannot be ignored.
The legislation requires automakers to reduce the amount of greenhouse gas emissions and correspondingly increase vehicle fuel efficiency over the next 11 years. Under the legislation, Illinois would adopt emission standards of California, which are more stringent than federal guidelines. The legislation states, if a car or truck is not in compliance with the standards, then the Secretary of State's office has the right to withhold registration or issuing a title for that vehicle.
Only 13 of the 22 flexible fuel vehicle models currently available in the U.S. meet the California standards. To redesign and build vehicles that do meet the standard is estimated to cost about $3,000. The payback in fuel efficiency of these vehicles does not pay for the extra cost over a normal vehicle life span.
Federal law prohibits states from setting fuel economy standards and is challenging the California standards. The Illinois Environmental Protection Agency is studying the California standards and its impact on our state. To adopt a new law that imposes a standard before its impact is known would seem overly premature.
Corn based ethanol has had many positive effects upon the environment, farm families and our state economy. Illinois has made renewable and alternative fuel use, especially ethanol, a top priority. If the standards set forth in this legislation are adopted, our continued promotion of flex fuel vehicles would be hampered.
At this time, HB 3424 is being held in House Rules Committee and will likely not be debated further until next year. Labor unions, auto dealers and manufacturers, farm groups, and the state Chamber all oppose this legislation but not the goal of cleaner air.
Other Legislation Passed Last Week
SB 2691 requires all universities and community colleges to develop an emergency response plan and train employees in following the plan in conjunction with local emergency management officials. In addition, the bill requires institutions to develop an interdisciplinary and multi-jurisdictional campus violence prevention plan. I sponsored the legislation in the House which contained the recommendations of the Governor's Campus security Taskforce.
SB 2857, which passed both houses this week, creates the Medicaid Hospital Assessment Program for FY09 through FY13. Under the proposal, local hospitals will be eligible for more federal funding of their services: Kishwaukee Community Hospital could receive $2.18 million in funding and Rochelle Community Hospital may receive $277,494.
HB 4255 is a bill I sponsored to require medically necessary preventative physical therapy for state and local government employees with multiple sclerosis. Private employees already have this benefit. Therapy has been proven to help MS patients live more normal lives.
Upcoming Internet Safety Program
The internet is a great highway for learning, entertainment and communication. However, like the typical highway, there can be all sorts of distractions, dangers and detours, especially for our children.
Come and learn about safe internet usage next Monday June 9 at 1:00 p.m. in the Sycamore Public Library from Mike Hughes of the Attorney General's Office. The program will be especially helpful for librarians, school officials and parents concerned about the safe use of the internet just like safe driving with our children.
Joining me in sponsoring the program are the Prairie Area Library System, the Sycamore Public Library, and the Illinois Attorney General's Office. We hope to see you there!
Trans Fat School Ban Falters
Efforts to pass Senate Bill 2858 failed in the House last week but proponents vow to try again next year. The bill would have banned the use of vegetable oils containing trans fats in food served in school cafeterias by 2010.
Trans fat occurs naturally in foods, but the use of artificial trans fat has grown dramatically since 1903 in order to improve food flavor and shelf life. Trans fat has been identified as the cause of many health problems, such as coronary heart disease.
The federal government has pursued a policy of requiring labeling about trans fat content so that consumers can make wise purchase decisions. Only New York City and North Carolina have imposed restrictions on the use of trans fats. Many food manufacturers and chain restaurants have voluntarily stopped using trans fats to avoid labeling and to promote their products' health benefits.
In the next issue of Perspective I will look at the need and funding proposals for creating jobs and capital improvements. Until then, have a great week.
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