We all know that Illinois is in a state of turmoil. Weve been guilty of kicking the can down the road one too many times, and for decades we have been neglecting our pension payment obligations. Ill be the first to say that I dont envy the Governors current position.
This past week Governor Rauner gave his annual budget address. In his speech, the Governor laid out his spending plan for the next fiscal year. Some of his numbers relied on the State Senate to continue negotiations in an attempt to fill a budget gap, and the rest relied on anticipated revenues.
There is little debating the fact that Illinois doesnt have enough funds flowing in to pay all of our bills. The only question is how are we going to fill that void. To his credit, the Governor has shown a refusal to play another game of kick the can. Previous Governors have relied on accounting gimmicks that raided the transportation and other funds, but Governor Rauner is determined to come up with a long-term solution to a far too long ignored problem.
So where does this leave us? The Governor signaled that it is necessary for the Senate to continue their budget negotiations to achieve a balanced budget. Weve already seen good progress on that front, though some proposals that have been floated were almost universally opposed.
One of the points where the Governor left no room for debate was in adding to the financial burden born by lower-income families and fixed-income seniors. This means that proposals which included taxing retirement income or raising taxes on food and medicine would all be opposed by the Governor.
Its safe to say that we will probably not have a budget until the Senate has reached an agreement, but an agreement is perhaps not as far off as some might think. As Ive said before, the Senate has never been closer to a budget compromise. Senate President John Cullerton and Republican Senate Leader Christine Radogno have been meeting regularly, and we can only hope that their meetings will result in an agreement.
Bi-partisan compromise is the only vehicle that can drive us out of this mess. Ill say it again and again: the Governor cant fix the states budget by himself. Its going to take Republicans and Democrats working together for the good of the state. Thankfully, that is exactly what we have been seeing, and that gives me hope for the future.
The one thing that we should all remember is that a balanced budget isnt just about getting your finances to look good on a sheet of paper its about confidence. When businesses know that Illinois is serious about meeting our obligations and serious about keeping our fiscal house in order, then we can expect to see economic growth.
Put yourself in the shoes of someone who is thinking about purchasing a house in a city whose city hall is so dysfunctional that the council cant agree to a budget. Would you feel confident about buying that house? Even if that house had everything you wanted, it would still have an ominous question mark lingering over it.
For the most part, thats how many businesses see Illinois. I can only imagine a board meeting in which the question is asked Why would we even move to Illinois when Wisconsin and Indiana have balanced budgets? We have no idea what new taxes Illinois will place on us the minute we locate there.
Not only am I thinking about companies that are considering moving here, I also have to think about those companies who are considering leaving Illinois out of fear for the future. Thats not even to mention the companies that very well could add new jobs, but have held off because of an environment of uncertainty. Once negotiations have concluded, we can move forward with a balanced budget, and we can expect a positive economic impact on our region.
Certainty and sustainability – those are the words that come to mind when considering what its going to take for Illinois to succeed. At this point, Im hoping that bi-partisan cooperation will lead to a healthy dose of both certainty and sustainability for all of us.