Friday, September 30, 2011

Rezin`s Report - Senate Week In Review

Rezin`s Report - Senate Week In Review:

Pat Quinn's mess....
This week, a report from The Civic Federation on Illinois’ Fiscal Year 2012 (FY12) budget confirms what Sen. Rezin and Senate Republicans have been saying for months— despite the Democrats’ January tax hike, the state’s deficit and bill backlog continues to grow.

While Illinois taxpayers were sold a tax increase as a way to solve the state’s financial problems, the FY12 deficit still exceeds the state’s FY11 deficit. Senate GOP lawmakers have consistently said that the tax increase will not solve Illinois’ fiscal problems unless there are major changes in the state’s spending habits. The Civic Federation backs up Senate Republican warnings, noting that despite the $7 billion in new revenue associated with the income tax increase, the FY12 budget is still approximately $455 million out of balance.

Echoing Senate Republicans’ criticism of the spending plan, the Civic Federation stresses the only reason there is any semblance of a balanced budget is due to the deferral of Medicaid payments. The budget plan failed to include revenue for a projected FY12 Medicaid liability of at least $11 billion, pushing off payment of $1.7 billion needed to cover the state’s entire FY12 Medicaid obligations.

The Civic Federation says that when combining the state’s operating deficit with the accumulated deficit from previous years, Illinois could see an $8.3 billion shortfall by the end of FY12. The Civic Federation noted that unpaid bills are anticipated to reach $5.5 billion, in addition to $2.8 billion in deferred tax obligations to corporations and Medicaid and employee health insurance payments.

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