UPDATE: On June 4, 2014, the State of Illinois filed its application for a $5 billion Medicaid plan with the federal government. Advocates for Medicaid recipients said they were told by State officials that there were no substantial changes from the version of the plan posted for public comment in February. Original post published on April 11, 2014 Despite a scheduled submission date of March 12, 2014, the State of Illinois has not yet filed an application to use more than $5 billion in new…
On March 26, 2014, Governor Pat Quinn presented an FY2015 budget proposal for the State of Illinois that avoids a fiscal cliff by retaining temporary income tax increases that were scheduled to be phased out beginning in January 2015. The Governor’s recommended budget also significantly increases the property tax credit for homeowners on State income taxes. In order to balance the budget and pay down a portion of the State’s backlog of unpaid bills in FY2015, Governor Quinn’s proposal requires…
Next week Governor Pat Quinn will give his sixth budget address since taking office in 2009. The budget is expected to be one of the most difficult of his tenure considering that the State is currently expected to have approximately $5.4 billion in unpaid bills at the end of FY2014 and will see a loss of $1.6 billion in General Funds revenues in FY2015, due to the reduced income tax rates that take effect on January 1, 2015 under current law. After requesting a delay in the release of his…
Unlike the federal government, the State of Illinois exempts all retirement income from the individual income tax. Of the 41 states that impose an income tax, Illinois is one of only three that exempt all pension income and one of 27 that exclude all federally taxed Social Security income, according to a report from the Chicago Metropolitan Agency for Planning. The Illinois Comptroller estimates that this exemption of federally taxable retirement income reduced the State’s individual income…
In its recently released FY2015 budget roadmap report, the Institute for Illinois’ Fiscal Sustainability at the Civic Federation recommended that the State of Illinois publish a five-year financial plan and that the plan be updated annually. This recommendation follows a best practice of the Government Finance Officers Association (GFOA), which urges every government to use long-term financial planning to align financial capacity with long-term service objectives. According to the GFOA, such…
Prior to the release of the Governor’s annual budget recommendation, the Institute for Illinois’ Fiscal Sustainability at the Civic Federation releases an analysis of the State of Illinois’ fiscal condition. The report reviews Governor Quinn’s three-year budget projection and proposes a comprehensive five-year plan for achieving long-term fiscal sustainability for the State of Illinois. The Civic Federation’s plan would fully pay down the State’s $5.4 billion backlog of unpaid bills while…
The Illinois House of Representatives has approved a revenue projection for the coming fiscal year that includes a $2.2 billion loss in operating resources for FY2015, after a holding series of committee meetings to deliberate varying estimates. The General Funds revenue estimate totaling $34.5 billion was unanimously approved on February 25, 2014 in House Joint Resolution 80. The revenue projection represents a 6.1% drop from the current FY2014 estimate of $36.7 billion by the Illinois…
It is widely known that the State of Illinois faces a dramatic reduction in general operating revenue starting on January 1, 2015, when temporary income tax rate increases enacted in 2011 are scheduled to partially roll back. General Funds income tax receipts will also decline around the same time for another reason: beginning on February 1, 2015, a portion of individual income tax collections will be diverted from General Funds to fund education and human services. This revenue will not be…
At a recent committee hearing, Illinois lawmakers were provided with a mixed message regarding the economy and State budget for the coming fiscal year. Officials from the Illinois Department of Revenue explained that although the State could expect improved underlying economic growth in the next two years, operating resources would still plummet in the next year due to current tax policy. Many of the key indicators the Revenue Department uses as the basis for its General Funds revenue…
In the fall of 2011, the Rhode Island General Assembly passed and Governor Lincoln Chafee signed landmark pension reform legislation intended to end a pension funding crisis and make retirement obligations for public employees more sustainable for the state and many local governments. To learn more about Rhode Island Retirement Security Act of 2011 (RIRSA) reforms, see this Civic Federation blog post from 2012.[1] The legislation went into effect July 1, 2012 and its primary provisions include…
