Despite a significant increase in Illinois’ corporate income tax rate enacted in January 2011, much of the anticipated new State revenue will be offset by corporate tax incentives provided in recent changes to the federal tax code. Known as bonus depreciation, the federal rule allows businesses to take an upfront deduction for the cost of capital investments in machinery or equipment from their annual taxable income. The amount of corporate income that is taxable on the state level in Illinois…
Although lawmakers have been considering ways to cut the State of Illinois’ costs for state retiree health insurance, the General Assembly adjourned on May 31, 2011 without taking action on the issue. A bill (Senate Bill 175) to require all retirees to pay a share of the cost for insurance premiums cleared the Senate Executive Committee on May 29 by a vote of 9 to 6. However, the sponsor, Senator Jeffrey Schoenberg, said he did not request a vote by the full Senate because many legislators had…
A critical fiscal process for state and local governments is the planning and funding of capital projects. The literature on best practices for capital budgeting is not as robust as for operating budgets and there is significant variety in the practices of governments. There are a number of factors that add complexity to capital planning, including the multi-year nature of capital projects, the difficulty of accurately estimating project costs and that it is common for the funding of capital…
The cancellation of Chicago Park District Fourth of July fireworks displays due to costs is the focus of this article. The Civic Federation says the cancellation of the displays demonstrates the dire financial straits the City is in, but that the Chicago must consider how it will attract visitors to the lakefront as it creates a long-term financial plan.
This article discusses some of the actions made by the State of Illinois General Assembly during the spring legislative session. The article cites Civic Federation data that showed debt dedicated to the State's pension system has exceeded capital debt.
This article discusses increases to health insurance premiums paid by City of Chicago retirees. The Civic Federation says that the City should create a retiree healthcare trust fund.
After several significant budget related initiatives failed to advance out of the General Assembly, such as proposed pension reforms and borrowing to pay down the State’s backlog of unpaid bills, the legislature passed an operating budget for FY2012 in the final hours of its regular session late on May 31, 2011. The budget passed by both chambers and sent to Governor Pat Quinn totals $33.2 billion in General Funds operating expenditures for the coming fiscal year, which begins on July 1. The…
This article discusses State of Illinois Treasurer Dan Rutherford’s resistance to proposals by State lawmakers to borrow to pay the State’s backlog of unpaid bills. The Civic Federation says that borrowing won’t ease the backlog and will impinge on future school and healthcare spending.
This article examines the various disagreements over plans of how, and if, to borrow to pay off the State of Illinois’ backlog of unpaid bills. The Civic Federation says that borrowing will worsen the State’s fiscal outlook.
Surprising as it may seem, not all budget cuts reduce spending. A case in point is the FY2012 Medicaid budget passed by the Illinois House on May 13, 2011. House Bill 3717 includes $6.9 billion of General Funds appropriations for the State of Illinois’ Medical Assistance Program.[1] As indicated in the chart below, the House budget is $537.3 million below Governor Pat Quinn’s proposed FY2012 General Funds Medicaid appropriation. It is also $586.2 below the appropriation passed by the Senate on…
