It’s time to set Illinois on a path for success
Illinois has now gone without a budget for 18 months. And as of Jan. 1, the spending authority provided by a short-term stopgap plan expired, meaning the state can no longer pay for new costs incurred by our colleges and universities, human service groups and businesses providing goods and services to veterans homes, correctional facilities and other institutions.
Illinois has been going down the wrong path for far too many years. Time and again, leaders have failed to make spending reductions and the structural changes necessary to end decades of budget deficits. Instead they have chosen politically expedient quick fixes that have made things worse in the long run. As a result, today our state has about $11 billion in unpaid bills, a $130 billion unfunded pension liability and a shrinking population base. In fact, last year Illinois lost more residents than any other state — nearly 40,000 people.
That is why I have stood strong while some have called on us to just pass another unbalanced budget with a massive tax hike, call it a day and go home.
It is critical that the General Assembly pass a comprehensive balanced budget immediately and end the undue hardship being felt across our state. And in order to truly get Illinois back on track, that budget must be accompanied by bipartisan reforms that will grow jobs, lower property taxes, improve schools and enact term limits.
We have to change the system because the status quo isn’t working for Illinois.
The status quo led the General Assembly to reduce pension payments four straight years starting in 2005, costing billions of dollars as the delay in contributions essentially borrowed from pension funds at a very high interest rate.The status quo led the state to borrow more than $7 billion combined in 2009 and 2010 just to make legally required pension payments. And the status quo in 2011 led to the largest tax hike in Illinois history — a 67 percent increase in the personal tax rate — while failing to address spending.
Enough is enough. It is time to make the long-term, structural changes necessary to ensure our state’s fiscal security for years to come.
Some have accused our administration of holding the budget hostage by making unreasonable demands. That simply is not the case. I have consistently encouraged all parties to come to the table and find areas where we can agree. Unfortunately, Speaker Michael Madigan will not engage in any discussion of structural changes, essentially refusing to pass a budget in order to protect the status quo.
To fully understand why I feel so strongly about reforms, it is important to know some of what I have put on the table for discussion:
First and foremost, I have looked to change policies in order to grow jobs. When I meet with employers, both in Illinois and across the country, they cite two primary challenges for businesses in our state: we have the highest property tax burden in the nation and an uncompetitive workers’ compensation system. Those costs are particularly harmful to employers with large physical footprints and large workforces. So it shouldn’t be a surprise that while other states, like Michigan, Indiana and Kentucky are growing, Illinois has lost 34 percent of its manufacturing jobs since 2000 alone.
Illinois employers spend approximately $3 billion a year on workers’ compensation, including medical expenses and disability benefits, giving us the designation as the most expensive state in the Midwest. Fraud and abuse are rampant in the system, and employers are often forced to pay for injuries that have nothing to do with the workplace. As a result, manufacturers are moving their business across state lines and other employers are refusing to invest here.
We’re proposing a permanent freeze on property taxes while giving voters in every community more control over how their government spends their tax dollars. Under our proposal, property taxes cannot rise unless local voters decide to raise them at the ballot box.
Workers’ compensation reform, coupled with lower property taxes, will bring down the cost of doing business in Illinois and encourage employers to locate, invest and create new jobs in our state.
Finally, it is critical that we enact term limits on politicians. When elected leaders are entrenched in office, they become less accountable to the taxpayers and more resistant to any change in the status quo. Enactment of term limits would return government to the people. Just as importantly, it would send a signal to job creators across the country that Illinois is serious about changing the way we do business.
Does passing a budget depend upon implementing every item on my reform agenda? Of course not; that would be unreasonable. Similarly, I believe it is unreasonable for the speaker to require that there be absolutely no change in order to agree upon a budget.
With the New Year and new members in the General Assembly, I am optimistic that we can find consensus on a budget and much-needed structural changes, both of which are long overdue. But in order to reach an agreement, all sides need to want an agreement. It is my hope that all parties will come back to Springfield ready to work and negotiate in good faith so that we can set Illinois on a path to success for years to come.