Illinois needs a real balanced budget requirement

By Ben VanMetre | Jun 12, 2014

Politicians are waiting for Gov. Pat Quinn to approve their state budget, and many are complaining that the budget isn’t balanced.

“The effect of the budget is to delay doomsday by borrowing and increasing our backlog of bills,” said a spokeswoman for Senate President John Cullerton. “Admittedly, this budget reverses some of the progress that we have made in recent years.”

The irony is that the same political machine complaining that the budget is unbalanced has been pushing unbalanced budgets for years.

Illinois does have a constitutional requirement to pass a balanced budget:
“The Governor shall prepare and submit to the General Assembly, at a time prescribed by law, a State budget for the ensuing fiscal year … The General Assembly by law shall make appropriations for all expenditures of public funds by the State. Appropriations for a fiscal year shall not exceed funds estimated by the General Assembly to be available during that year.”

But in Illinois, “balanced budget” has a loose meaning. There are so many loopholes in the budgeting process that the requirement is practically meaningless.

The 2015 budget is a perfect example.

Income tax rates are slated to drop halfway through the 2015 budget year. And that decrease meant lawmakers had to find more than $1 billion in savings to pass a balanced budget.

Politicians relied heavily on gimmicks to find that $1 billion. Approximately $650 million was taken from a laundry list of state funds to cover general spending. Another $650 million was diverted from paying the state’s bills to cover general spending. And politicians pushed nearly $400 million in health insurance bills into the next budget year.

These tricks are fair game under current law, and politicians have used them for decades to “balance” the budget.

In fiscal years 2010 and 2011, for example, Quinn borrowed billions to finance the state’s pension systems.

In 2011, the General Assembly passed what they called a balanced budget. In reality, politicians used an accounting gimmick to push more than $1 billion in unpaid bills into the next fiscal year.

The truth is that the state hasn’t had a balanced budget since 2001. Illinoisans have learned that if lawmakers are allowed to push tough decisions into the future by playing fiscal shell games, they will. The current balanced budget requirement simply fails to prevent it.

As the budget debates continue, lawmakers will fall back on the argument that they need another tax hike to balance the budget. But that’s the last thing this state needs. Lawmakers should instead learn how to spend within their means and enact a real balanced budget requirement.

Strengthening the requirement would finally hold politicians accountable for their spending decisions. Only then will they be forced to pass a truly balanced budget – ending the cycle of credit downgrades and setting the foundation for responsible spending in the future.

Benjamin VanMetre is Senior Budget and Tax Policy Analyst for the Illinois Policy Institute. 

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