Jun 1, 2009 5:25 pm US/Central
Facing Cuts, Ill. Leaders Start Budget Work Anew
SPRINGFIELD, Ill. (CBS) ―
Gov. Pat Quinn and top Illinois lawmakers renewed budget negotiations Monday, promising to genuinely work together in a new push to solve the state's money crisis and avoid drastic cuts that could affect services ranging from elderly care to drug addiction treatment.
Quinn met with legislative leaders for about 90 minutes in his Springfield office after lawmakers missed a Sunday night deadline to come up with a new budget and figure out how to fill an $11.6 billion deficit. Lawmakers couldn't agree on a mix of spending cuts and tax increases to close the gap.
Sources said the governor's meeting with the leaders was tense at times. Afterward, Quinn warned of the bad news coming this week for hundreds of state social service contractors and thousands of their employees.
"It's a dire situation," Quinn said. "I've said that over and over again."
Now the state must start sending notices to local agencies that provide a wide array of services, warning they could lose much of their funding.
The governor's staff said potential spending cuts include:
--20,000 seniors losing in-home health services
--9,000 foster parents losing state stipends
--175,000 losing community mental health services
--190,000 college students losing state scholarships
Even as he prepares for those and other cutbacks, the governor vowed to keep working for an income-tax increase. He said it might avert the cuts.
Both parties tried to stay positive after Monday's meeting. Republicans said Democrats agreed to take a new look at reforms to government pension and health programs to cut costs, while Democrat Quinn said he's hopeful an agreement can be reached before service cuts start taking effect July 1.
"I think the feeling in the room was very positive that we are a team," Quinn said. He said budget staffs will meet Wednesday, then he will meet again with legislative leaders Thursday in Chicago to hear efficiency recommendations from his Taxpayer Action Board.
House Minority Leader Tom Cross, R-Oswego, indicated he doesn't see the July 1 start of the budget year as a firm deadline. He noted a stopgap budget is in place and ready for the governor to sign so that government can keep operating.
"While we recognize there are problems out there and they need to be dealt with, what we are talking about are reforms that aren't going to happen overnight," Cross said. "We are not going to rush this, whether it's on Medicaid, whether it's on pensions, whether it's state agencies doing duplicative work. We're going to take some time working on reform in a lot of areas before we have any discussions about revenue."
Budget negotiations floundered over the weekend amid failed attempts to raise state income taxes to fill the deficit. Top lawmakers said without new tax dollars, available money would fall about $7 billion short of covering government expenses in the coming fiscal year.
After it became clear no tax increase would pass, both the House and Senate approved a limited budget to keep state agencies running.
"This is it. This is all we have to spend," said House Majority Leader Barbara Flynn Currie, D-Chicago. "When we spend this, our pockets are bare."
The House tried to come up with new money Sunday by voting on a temporary income tax that would have generated about $4.5 billion. It would have bumped the state's 3 percent personal tax rate to 4.5 percent for two years.
The measure failed 42-74, with two "present" votes.
A day earlier, the Senate approved an even larger, permanent tax increase. But Democrats said that plan had even less support in the House.
Some expect this budget impasse may last all summer and into the fall.
Quinn said until a balanced operating budget is approved, he won't sign the $28.3 billion statewide capital construction bill lawmakers have sent him to pay for a boatload of public works projects.
The legislative session began with pledges of bipartisan cooperation after the ouster of Gov. Rod Blagojevich, with leaders of both parties blaming him for years of paralysis in Springfield. The friction hadn't disappeared entirely; Republicans complained they weren't included in serious budget talks until their votes were needed at the end of session.
Lawmakers faced a Sunday deadline for deciding what to do about the budget deficit for the 12 months starting July 1. Passing the budget now requires a super-majority, giving the Republican minority new leverage in budget discussions -- as well as a share of the blame for any fallout.
Also Monday, Illinois House Speaker Mike Madigan, D-Chicago, held a brief and rare conversation with the media. When asked about his daughter, Attorney General Lisa Madigan, possibly running for governor, the proud father praised her work. The younger Madigan could be a rival to Quinn in the next governor's race.
"Lisa Madigan is gonna do what she's gonna do and she'll do it on her own," the elder Madigan said. "Her record stands. … Just about everybody in Illinois knows her record."
When asked if he would step down as speaker if Lisa Madigan ran for governor, the interview abruptly ended.
CBS 2 Political Editor Mike Flannery and The Associated Press contributed to this report.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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