Center for Tax and Budget Accountability

House to Begin Committee of the Whole Tomorrow to Deal With Budget

Comptroller Hynes Says the State Needs a Budget in Place by July 10th

Tomorrow the House will hold a Committee of the Whole to deal with the absence of a Fiscal Year 2009 budget. The first day of the new fiscal year was July 1st, seven days ago.

According to Illinois Comptroller Dan Hynes, the State can operate without a budget until July 10th. The State Journal Register reports that in a letter to the Governor, lawmakers and other officials, the Comptroller said his office needs a budget in place by July 10 to ensure that about 4,900 employees are paid on time July 15. The following week, paychecks for another 8,200 employees could be in jeopardy. Hynes said some payments, such as checks to state government retirees and payments to the needy will be paid regardless of a budget.

Schools will not be at risk until August. In June, the state made two General State Aid payments to schools, so there is no July payment.

Those in the most trouble are organizations that provide state services, such as senior and disability care. Hynes said a delay in enacting a budget "affects the issuance of tens of millions (of dollars) each and every day to state vendors and payees," which will have a "grave impact" on entities that provide health care, social services and transportation.

BACKGROUND:
The General Assembly passed a state budget for FY 2009 that, according to the Governor's office, is $2 billion more than predicted revenues for the fiscal year (on top of $1.3 billion the state owes in Medicaid bills). They left it up to the Governor to balance. The governor has the following options:

Veto the entire budget and send it back to the General Assembly. The GA would need a 3/5 majority (including Republican support) to override the Governor's veto.
Line item veto specific budget appropriations (as stated in the press release and similar to what happened last year). The General Assembly would only need a majority to override the line item veto. This would require Republican support in the House.
Do nothing and the bill will become law after 60 days.

Two weeks ago, the Governor held a press conference outlining $1.5 billion in budget cuts to education and social services, "...if the Senate's "revenue" package is not passed." (see analysis of the revenue package below). He called on the House to convene to pass a revenue package that will fill the budget gap.

The Governor outlined several cuts he will make to the General Assembly passed budget if no new revenue bills are passed including a:

$110 million reduction in education funding,

$260 million cut to social service programs (such as mental health and disability programs),

Staff reductions throughout the state,

$530 million in Medicaid reductions, (resulting in longer wait times for paying health care providers and on top of the current bill backlog of $1.3 billion) and

$106 in reductions to senior and veteran's programs. (Read a summary of the press conference here).