IIFS Blog

05.12.15

Supreme Court Pension Ruling Adds to FY2016 Budget Pressures

An Illinois Supreme Court decision overturning legislation to reduce the State’s massive pension costs will add to the difficulty of creating a balanced operating budget for the year that begins on July 1, 2015. The high court struck down the law on May 8, ruling that it violated the Illinois...

04.30.15

Governor's Budget Cuts Include Reducing and Eliminating Statutory Transfers

To help cope with a massive budget deficit as State resources continue to fall in the coming fiscal year, Governor Bruce Rauner has proposed reducing or ending some statutorily required transfers that provide funding for programs and government services outside the General Funds budget. Total...

04.16.15

Rhode Island Again Close to Public Pension Settlement

Rhode Island recently reached a potential settlement agreement with most employee and retiree groups involved in litigation against its 2011 landmark pension reforms. The details of the agreement became available on April 13, 2015 through a court filing that was one of several steps necessary for...

04.10.15

State Construction and Local Tax Funds Allocated for Illinois Operating Budget

A week after passing legislation to address a $1.6 billion budget deficit before the end of the fiscal year in June, the State swept $300 million into its operating accounts from funds designated to pay for annual transportation construction projects. An additional $200 million sweep of sales tax...

04.03.15

Illinois Approves Fix for FY2015 Budget Gap

The State of Illinois recently enacted legislation designed to close a $1.6 billion budget gap for the fiscal year ending on June 30, 2015. This blog post reviews the causes of the operating deficit and examines Public Acts 99-0001 and 99-0002, which were signed by Governor Bruce Rauner on March 27...

03.26.15

Civic Federation Proposes Local Government Protection Authority at Illinois House Committee Hearing

Under federal bankruptcy law, State governments decide whether and how local governments have access to Chapter 9 bankruptcy. There are 12 states that allow their local governments unfettered access to municipal bankruptcy, 12 states that allow municipal bankruptcy under certain conditions, two...

03.23.15

No Budgetary Relief from Latest Illinois Revenue Estimates

The most recent legislative analysis of the State of Illinois’ annual revenues provides little hope for additional gains from economic growth to help solve the State’s ongoing budget crisis. This is in contrast to the last several budget years when the State has experienced revenue...

03.11.15

Governor Proposes Significant Reduction in Funding to Local Governments

Under Governor Bruce Rauner’s proposed FY2016 budget, one of the largest sources of state funding for local governments in Illinois would be reduced by half. The reduction is part of more than $4 billion in spending cuts and $2.2 billion in estimated pension savings recommended by the...

03.06.15

Illinois Governor Proposes ‘Hard Freeze’ of Pension Benefits

Governor Bruce Rauner’s recommended budget for fiscal year 2016 includes a new plan for reducing the State of Illinois’ massive pension costs. As discussed here, the plan could cut the State’s unfunded pension liability by approximately $25 billion and save $2.2 billion on pension...

02.27.15

Governor Proposes Shifting Capital Funding For Delayed Maintenance

Alongside his first operating budget proposed for the State of Illinois, Governor Bruce Rauner also recommended a capital budget for FY2016 that proposes shifting previously vetoed spending authority to pay for delayed maintenance at State owned facilities across the state. As previously discussed...

02.20.15

Governor Proposes Deep Cuts and New Pension Reforms to Balance FY2016 Budget

In his first budget proposal for the State of Illinois, Governor Bruce Rauner recommended more than $4 billion in spending cuts and $2.2 billion in estimated pension savings to close a projected budget gap of over $6 billion in fiscal year 2016. The proposed $31.5 billion General Funds budget...

02.13.15

Illinois’ Most Expensive Tax Exemptions

The State of Illinois reduces its operating resources by more than 25% annually to provide individuals and businesses tax benefits through exemptions also known as tax expenditures. In FY2013, the most recent year that data have been reported on tax expenditures, the exemptions in Illinois totaled...

01.29.15

Comparing Investment Return Assumptions of Illinois Pension Funds to National Trends

At the end of December, the Illinois Auditor General released the State Actuary’s annual report on the actuarial assumptions and valuations of the State’s five pension funds. In its report, according to State law, the State Actuary must evaluate whether the pension funds’...

01.23.15

Illinois Reduces Revenue Estimates for Corporate Income Taxes

The State of Illinois projected a major loss of income tax revenues in FY2015 due to the reduced rates for individuals and corporations that took effect on January 1, 2015. However, corporate income taxes have taken a steeper decline than originally projected and began to fall even before the rate...

01.15.15

Illinois Medicaid Plan Awaits Action by New Administration

The fate of a proposal to use more than $5 billion in new federal funds to overhaul the State of Illinois’ Medicaid program remains unclear as a new gubernatorial administration takes office in Springfield. As previously discussed on this blog, the five-year proposal focuses on developing...