Thread: Raise taxes 33% or cut education, IL. Gov.

Raise taxes or cut education, Quinn says

Governor calls for ‘some difficult, painful choices’

9:32 p.m. CST, March 10, 2010

SPRINGFIELD - — Democratic Gov. Pat Quinn pitched a 33 percent income tax increase Wednesday, framing the debate as a choice between finding more money or hurting schoolchildren.

But the governor's challenge to lawmakers immediately ran into Republican criticism that Quinn is holding students hostage and into a Democratic dose of political reality.

"The people of America don't want tax increases. …They're hurting," said House Speaker Michael Madigan, D- Chicago, speaking on public television's " Illinois Lawmakers."

Madigan did not say whether he'll muster the Democratic votes required to approve a tax increase this spring, noting the Republican rallying cry against higher taxes before the November election. It was clear lawmakers from both parties do not feel bound by the choices Quinn is offering.

Democratic leaders who control the House and Senate are trying to finish business by early May so lawmakers can go home and campaign. That means the General Assembly could repeat last year's tactic of postponing hard decisions in the hope that a second straight year of relying on borrowing could get them safely through the election.

Quinn warned against that approach.

"It might seem easy to close our eyes, cross our fingers and kick the can down the road," Quinn said in his budget speech. "But we can't do that. The cost of doing nothing is too great. I have made some difficult, painful choices in this budget. You must make some tough choices as well."

Republican state Sen. Bill Brady, Quinn's rival in the governor's race, called Quinn's proposals a "catastrophe."

"We cannot increase taxes in this state," said Brady, of Bloomington. "All we're going to do is push more jobs out of the state."

During his speech, Quinn tried to pre-empt Brady's attack, lashing out at Brady's call for 10 percent across-the-board cuts as a budget solution.

"That approach is both heartless — and naive," Quinn said. "Taking a chainsaw to our state budget for schools, for health care, for human services and public safety is wrong."

Without taking action, the state faces a potential $13 billion shortfall in the budget year that begins July 1. Quinn formally presented a spending plan that relies on borrowing $4.7 billion, rolling over about $6 billion in backlogged bills and cutting about $2 billion.

Quinn wants to raise the individual income tax rate to 4 percent from the current 3 percent rate — a 33 percent increase. Corporations would see the rate go to 5.8 percent from 4.8 percent.

If approved, the state could raise more than $2.8 billion, with $1.3 billion to prevent Quinn's slashing of school funding, and the rest for paying down old bills, depending on how lawmakers divide the funds.

At a minimum, Quinn has made school funding a key issue this spring, thrusting powerful teacher unions into the debate as officials estimate 17,000 teachers could be laid off. The Illinois Federation of Teachers welcomed Quinn's call for a tax increase, but said it's not large enough to deal with the state's overall money problems.

The sweeping education cuts under Quinn's no-tax-hike proposal mean the state's minimum funding level per student would drop from its current level of $6,119 a year to $5,669 a year.

According to a legislative budget analysis, Quinn also suggested a $401 million decrease in grants ranging from transportation to special education, categories that represent a significant share of state funding for suburban school districts, particularly an important issue to Republicans.

Funding for bilingual programs would be cut by $20 million, and early education, a program highlighted by President Barack Obama, also would be cut by $54 million.

House Republican leader Tom Cross, of Oswego, accused Quinn of using "scare tactics" on educators and parents fearful that jobs, salaries and programs would be cut and force local officials to raise property taxes to make up the difference.

Cross gave no sign that he's dropping his longtime opposition to a tax increase, saying Quinn "is a fella and an individual and a politician that likes to hold people hostage. ... No one wants to see (school funding) decimated the way he's talking about. I would suggest to you at the end of the day this isn't going to happen."

"We're not going to be bullied into it," said Senate Republican leader Christine Radogno, of Lemont.

For months, Madigan has made it clear he wants some Republicans to support a tax increase, saying GOP lawmakers need to show a willingness to take the tough vote. GOP support also could provide Democrats with political cover in the fall election.

"I sincerely hope that every member is prepared to cooperate, every member is prepared to do some heavy lifting," Madigan said, referring to the upcoming budget negotiations. "I have my doubts."

Quinn budget chief David Vaught said the proposal is for a permanent tax increase. A Quinn budget office spokeswoman said the governor also would support a temporary tax hike if that's what legislators send him.

Senate President John Cullerton, D-Chicago, supported Quinn's tax plan but said the increase "doesn't have to be permanent."

Cullerton said he hoped to achieve substantial savings in the next budget and down the road from an effort to retool state employee pension plans.

The governor now finds himself in the difficult position of trying to sell complex financial concepts and solutions in a heated political environment that puts a premium on quick and easy-to-digest fixes.

Perhaps nothing illustrates that better than Quinn's rationale for seeking to borrow nearly $5 billion as part of the budget-balancing equation. The cash-starved state faces a multibillion-dollar pile of unpaid bills and is legally required to pay 12 percent interest to those owed.

So, the administration argument goes, the state actually saves money when it pays those bills on time using money it can borrow at a far lower interest rate. Such a maneuver, however, can be a tough political sell, with nuances often falling by the wayside.

"A family, a business, a government cannot borrow unless it's got a plan to pay it back," said Brady, not dwelling on the intricacies of Quinn's borrowing proposal. "In the financial markets, I'm not sure he could get a loan."

Quinn's campaign said Brady's budget solutions are both vague and an "economic vision for 1910, not for 2010."

Tribune reporter Michelle Manchir contributed to this report.

rlong@tribune.com

mcgarcia@tribune.com

bsecter@tribune.com

http://www.chicagotribune.com/news/elec ... 2692.story

What about the third alternative of removing all illegal aliens and their dependents from Illinois? How come nobody mentions that option?

Why is it always, "the kids will suffer"? Why is it, that the kids programs will get cut? How about trimming the fat in the over bloated administrations of the school system? I'm sure there are plenty of things that can be cut there.