Analysis of the Fiscal Year 2008 Final General Fund Budget


March 11, 2008

After a record overtime sessions, the Illinois Fiscal Year (FY) 2008 budget was enacted on January 4, 2008. The total enacted General Fund budget for FY2008 was $27.4 billion. This Report contains CTBA's analysis of the enacted, FY2008 General Fund budget. The final General Fund budget for FY2008 demonstrates the continuation of two significant flaws in the state’s overall fiscal system. First, revenue growth will again fail to keep pace with the economy, falling short of inflation. This pattern of revenue underperformance is long standing, and has contributed substantially to Illinois’ structural deficit. The state’s historic revenue underperformance also has contributed to the second significant flaw demonstrated in the FY 2008 General Fund budget –Illinois will continue to rely on significant infusions of debt and one time revenue sources to fund services. The projected budget deficit for FY2008 is currently $4.5 billion. Borrowing and utilization of one-time revenue sources like fund sweeps and deferring payments to medical providers to the next year to pay for current operations has become common practice because the Illinois revenue system cannot cover current public service costs.

Topics:Tax and Budget, Illinois Budget, Revenue Policy, Education, Healthcare, Pensions

Tags:FY2008, State Budget, State Revenue, General Fund, State Pensions, 95th General Assembly, Short Term Borrowing, Deficit