Gov. JB Pritzker has proposed growing spending by about $2 billion without new income or service taxes in the upcoming fiscal year – though his administration acknowledged policy changes by the Trump administration could drastically alter the fiscal landscape.
Spending and revenues would each grow by about 3% under the proposal laid out Wednesday during the governor’s annual budget address, with total general revenue fund spending growing to $55.2 billion.
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The proposal is balanced, in part, because the governor’s budgeting office expects to collect about $1.5 billion more in base tax revenue than it did when it issued its first fiscal year 2026 forecast in November. The governor also proposed spending about $1.1 billion less than what was projected in that November estimate.
That November forecast from the Governor’s Office of Management and Budget had projected revenues to remain flat, driving a deficit of $3.2 billion. But it relied on a September economic forecast from the financial services company S&P Global. The governor’s office says S&P has since revised its forecasts – but the numbers released Wednesday are ultimately likely to fluctuate amid the rapid pace of policy changes happening in Washington, D.C.
The governor’s proposal would increase K-12 funding by $350 million and boost higher education funding by 3%. He’d keep funding flat for the Early Childhood Block Grant, however, which is a major driver of his effort to increase access to publicly supported preschool in Illinois.
Ultimately, lawmakers and the governor will have to come to an agreement on a spending plan by the end of May. But the governor’s opening salvo could meet opposition from Democratic lawmakers in the General Assembly – especially members of the Illinois Legislative Latino Caucus – due what it doesn’t fund.
The proposal would eliminate a health care program for low-income noncitizens aged 42-64 who are in the U.S. without legal permission. The Health Benefits for Immigrant Adults program, which was implemented in 2022, provides Medicaid-like benefits and costs the state general revenue fund roughly $330 million, or less than 1 percent of the overall budget.
“As always, I stand ready to work with members of the General Assembly to deliberate and negotiate the final budget, but let’s be clear, I will only sign a balance budget. If you come to the table, looking to spend more, I’m going to ask you where you want to cut,” Pritzker said in his address.
Advocates say that program is a key public health measure that drives down emergency room care costs and ultimately saves money. The governor’s office says its decision not to propose funding reflects the state’s fiscal reality.
The budget proposal maintains funding for a similar program serving immigrants aged 65 and older, passed by the legislature during the early months of the pandemic in 2020.
The governor’s plan would raise another $469 million in revenue through other changes to law, including adjusting tax rates on electronic gambling and table games at casinos to generate $100 million in revenue. The plan also calls for pausing the transfer of $171 million in sales tax collected on motor fuel to the road fund, and raising $198 million by providing temporary amnesty for individuals making delinquent tax payments.
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