Pritzker budget adds money for immigration, education

The governor's budget speech will be the unofficial kickoff to months of negotiations under the Capitol Dome in Springfield to develop a spending plan for fiscal year 2025, which begins July 1.

The effort comes at a time when all signs point to a difficult budgeting process as lawmakers try to raise money to accommodate the more than 35,000 asylum-seekers arriving in Chicago by bus from Texas. has already proven costly and exposed fissures within the Democratic coalition. .

At the same time, tax revenues are down from their post-pandemic highs, leaving lawmakers with less flexibility than they have in the past three years.

The Governor's Budget Office predicted in November that the state would end the fiscal year with a budget surplus of about $1.4 billion.

But Illinois faces an $891 million deficit next year.

With a less-than-rosy budget outlook on the horizon, Mr. Pritzker will have to navigate the difficult politics of the immigration crisis. So far, the state has spent more than $640 million on this effort this fiscal year, including accelerating the intake process, establishing temporary shelters and housing new arrivals. Includes $160 million in November for occupancy.

On Thursday, Mr. Pritzker announced that his budget proposal would include an additional $182 million, out of the $321 million that state, Cook County, and Chicago leaders have estimated will last through the remainder of the term. That's more than half of the amount needed to maintain shelter services. calendar year.

Cook County Board of Commissioners President Toni Preckwinkle pledged to contribute an additional $70 million to the county's coffers. It's unclear where the remaining portion will come from, as Chicago Mayor Brandon Johnson reportedly reneged on an agreement that required the Chicago City Council to embed the remaining portion.

The budget year runs six months through 2025, but state funding beyond this calendar year was not immediately clear.

“As thousands of asylum seekers continue to come to Chicago in desperate need of assistance, and Congress continues to refuse to act, we need states, counties, and cities to do more to keep people safe. It is clear that we must,” Pritzker said in the paper. statement.

Providing additional funding for the migrant crisis will not be easy. Legislative Republicans have ruled out supporting more state resources for immigrants, but even some Democrats in the supermajority, especially those representing low-income areas with long-standing needs, have argued against supporting more state funding for new immigrants. Be cautious about offering.

“We have to take care of what we have here today, but we don't have the services to handle the influx of people coming here,” House Republican Leader Tony McCombie (R-Savannah) said earlier this month. He said this at a press conference at the National Diet Building. “We all, especially in Chicago, see residents in Chicago and around the state having their services taken away from them to pay for their services, and this is completely inappropriate.”

“We will have to fund a crisis that has existed in our communities for generations,” Senate President Don Harmon, D-Oak Park, told the Chicago Tribune last month. He rejected a separate spending bill for immigration.

Immigration funding, which takes into account both this year's budget proposal and the debate over spending starting in July, appears likely to be incorporated into broader budget negotiations this spring.

House Speaker Chris Welch, D-Hillside, has formed a task force tasked with finding a legislative solution to the crisis. One of the group's members, state Rep. Jehan Gordon Booth, is also the lead budget negotiator for House Democrats.

“This issue is going to be a very important part of budget negotiations,” Peoria's Gordon Booth said in an interview last week. But she noted that there is only so much that can be done at the state level to truly address federal issues.

“There is no such thing as delusions of grandeur,” said Gordon Booth. “It's unrealistic that our state or any other state is going to solve this problem. It wasn't. We have to deal with a crisis that has literally fallen on our heads.

“And what we're going to do is continue to have conversations about what can be done (and) what's possible.”

Gordon Booth added that Pritzker will deliver a “very important budget speech next week, because like every other state, we obviously have unlimited needs, but we have finite resources.” .

The Pritzker administration declined to meet with budget officials ahead of the governor's speech. And so far, state leaders have remained silent on specific details of the budget proposal. But some are already known.

For example, Pritzker's proposal would include an additional $75 million in early childhood block grants as part of Smart Start, a multiyear universal preschool plan that was the centerpiece of last year's budget proposal.

The goal is to increase funding levels by 2027 to eliminate early childhood education deserts across the state. In the program's first year, more than 5,800 new preschool seats were created for children from low-income families. The ultimate goal is to create 20,000 seats.

Pritzker also announced an additional $350 million in K-12 spending required under the state's evidence-based funding law, which aims to narrow the funding gap between low-income and high-income school districts. It is likely to be included.

If past is prologue, Pritzker will also include paying the full pension amount required under state law. That would account for nearly $10.2 billion of the General Fund budget, an increase of about $350 million from the current fiscal year, according to estimates by the Government Forecast and Accountability Committee.

These three items add up to more than $775 million in spending increases, and that's before spending requests from lawmakers and various interest groups are taken into account.

For example, earlier this month, progressive lawmakers unveiled a proposal on Capitol Hill proposing a $300 per child tax credit for households earning below the median income. A recent study found that such a proposal could cost the state about $470 million a year.

The administration is expected to provide updated forecasts on Wednesday about this fiscal year's surplus and revenue projections for next budget year. All signs point to budgets being tighter than in past years and new spending need to be reined in.

“The receipts are coming back and it shows us that we're going to see an economic slowdown, which means we're going to see a tightening of revenue,” said state Sen. Elsie Sims (D-Chicago), the Senate Democratic lead budget negotiator. Ta. “And one of the things we've been very disciplined about is not putting permanent spending into the budget.”

“We need to prepare for even tougher times in times of prosperity,” Sims added. “And I think we did that.”

This is Pritzker's sixth national budget proposal since taking office in 2019.

Illinois has experienced a series of credit rating upgrades and increased budget surpluses over the past several years, supported by strong post-pandemic income and sales tax revenue growth and federal stimulus.

This gives Gov. Pritzker a level of budget flexibility not enjoyed by any governor in more than two decades.

But the administration has remained deliberately conservative in its revenue projections for years, aiming to over-deliver rather than under-promise. This strategy was partially inspired by the unusual nature of the recent surge in earnings and predictions of a recession that never came.

Amanda Kass, an associate professor at DePaul University who studies public finance, said the state's finances are much better off than they were 10 years ago. A conflict between former Republican Gov. Bruce Rauner and the Democratic-controlled Legislature led to a budget impasse that lasted from July 2015 to August 2017.

But Kass said lawmakers need to continue to show restraint in this budget and subsequent budgets, given inherent cost pressures such as pension obligations and funding for human services and schools.

“It's improved. We kind of dug ourselves out of a huge scary hole,” Kass said. “But (we) need a lot more progress.

That's why it's important for the governor, whether it's Pritzker or anyone else in his position, to maintain positive momentum toward stabilizing the state's finances without dramatically escalating new fiscal recovery efforts. Striking that balance is both important and challenging in a sense. hole. “

Gordon Booth said Pritzker's proposal provides “a baseline for engaging members based on their priorities.”

Lawmakers and advocates have offered a variety of requests for new spending, including a $300 child tax credit and additional funding for cities through the Local Government Distribution Fund. When asked about these proposals, Sims said: “There's always room for dialogue.”

“Now, does that mean we'll get there eventually?” he continued. “I don't know.”

McCombie said the caucus would aim to “hold the majority party accountable” for spending and oppose tax increases, but nothing has been proposed so far. She also said she supports increasing evidence-based funding for K-12 schools.

Senate Republicans are expected to announce their budget priorities in the coming days, but they want a budget that prioritizes making Illinois a safer and more affordable place for Illinoisans to work and live.

“Illinois' budget priorities have shifted from supporting Governor Pritzker's efforts to make Illinois a non-welfare state to supporting Illinois families,” said Senate Republican Leader John Curran, R-Downers Grove. There must be,” he said.

The governor will address the House of Representatives at the Illinois State Capitol at noon Wednesday.

Kellie Foy of Lee Enterprises contributed to this report.