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House GOP: Unexpected revenue means no new taxes needed

House GOP: Unexpected revenue means no new taxes needed

Deputy minority leader says his caucus will support MCO assessment, sports gambling

By JERRY NOWICKI

Capitol News Illinois

Jnowicki@capitolnewsillinois.com

SPRINGFIELD – One day after lawmakers learned the state collected $1.5 billion more in tax revenue than was expected in April, House Republican leadership argued Wednesday that the good news is proof that new taxes are not needed to right the state’s financial ship.

“The numbers are clear,” House Republican Leader Jim Durkin (R-Western Springs) said at a Capitol news conference. “We now have the money to balance the budget with no new taxes, no tax increases. There's no need to talk about raising taxes on bags, cigarettes, businesses or the middle class. And there is certainly no reason to be even considering a graduated tax.”

On Tuesday, the greater-than-anticipated revenue was announced in a letter written by Department of Revenue Director David Harris and Alexis Sturm, director of the Governor’s Office of Management and Budget.

“As an immediate result of the strong April performance, coupled with revenue collections year-to-date, the State of Illinois will be able to address most of the $1.6 billion shortfall in the enacted (Fiscal Year 2019) budget because of the April revenues alone,” Harris and Sturm stated.

The Department of Revenue also raised its official estimate of next year’s tax collections by $800 million. That allowed Gov. J.B. Pritzker to scrap an unpopular proposal that would have decreased the statutorily-mandated state contribution to the pension fund for fiscal year 2020 by about $800 million, allocating the money to other state spending.

“The thought of another pension holiday as a shortcut to meaningful budget negotiations was simply wrong,” Deputy House Minority Leader Dan Brady (R-Bloomington) said. “And I'm glad we were able to take that bad idea off the table for now. And I’m hopeful that it stays off.”

The “pension holiday” was part of several facets of Pritzker’s budget proposal. Others include licensing fees from legalized marijuana and sports gambling, a tax on plastic bags, and an assessment on Medicaid managed care organizations that would bring an estimated $390 million in added revenue into the Medicaid system.

Deputy House Minority Leader Tom Demmer (R-Dixon) said House working groups have been seeking to balance the budget without including any of the proposed new revenues included in Pritzker’s budget address.

Brady said a higher education working group was able to identify 6 percent cuts, while Demmer said the news of the added revenue projections was a “positive step for the working groups to consider.”

Demmer said “as a sign of good faith” in budget negotiations, House Republicans would be prepared to put “a proportionate number of votes behind” the MCO tax and the sports gambling legislation. 

Durkin noted that a balanced budget for Fiscal Year 2020, which begins July 1, would not include new revenue to pay down the bill backlog, which is between $6 billion and $8 billion.

“We hope that this will be the second year in a row that we were able to accomplish a balanced budget,” Durkin said. “What we have left afterwards, we can address collectively what we can put towards our backlog. But I'm interested in getting our budget in place. We can talk about the next step about how we can address the backlog in a professional manner after we get this major obligation out of the way.”

The three Republican leaders also urged greater collaboration in the budget process, noting the four legislative leaders have not met with Pritzker about the budget since mid-April.

“The state is better off when we have a two-party solution to the budget,” Durkin said.

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Jerry Nowicki

Jerry NowickiJerry Nowicki

Jerry has more than five years of experience in and around state government and nearly 10 years of experience in news. He grew up in south suburban Evergreen Park and received a bachelor’s degree from Illinois State University and a master’s degree online from Purdue University.

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