Springfield, Ill. – Tensions were high in the Statehouse this week, as the four legislative caucus leaders continue to meet with the governor to negotiate an end to the ongoing budget stalemate. However, a compromise remains elusive, and while Republican lawmakers stress they are trying to remain optimistic a final budget can be negotiated before the May 31 legislative adjournment date, Democrat leaders remain opposed to the Republicans’ insistence economy-boosting, job creating reforms must be part of the final package.

Instead, over protests from Republican lawmakers, the Speaker pushed through a budget this week that is at least $7 billion out of balance, and would rely on a tax hike projected to cost the average Illinois family $1,000 each year.

While the budget stalemate continues to dominate Statehouse news, the General Assembly has been busy considering legislation and passing measures on to the House or the Governor. Over objections from Republicans, Senate Democrats advanced two proposals to bailout the Chicago Public Schools at the expense of downstate and suburban students.

However, this week one controversial measure hit a roadblock—the House failed to override the governor’s veto of the controversial “binding arbitration” bill.

Budget negotiations remain strained

As the legislative session heads towards the scheduled May 31 adjournment date, the leaders of the four caucuses met several times this week with Gov. Bruce Rauner. Though the Governor’s budget director offered his opinion that a budget agreement is possible by Tuesday, budget negotiations remained strained, with Democrat leaders refusing to entertain Republicans’ calls for common sense, economy boosting reforms as part of the compromise.

The state director of the Governor’s Office of Management and Budget (GOMB), Tim Nuding, stressed that the longer it takes to come to a budget compromise, the bigger the state’s problems get. He underscored serious concerns about keeping utilities and other critical services operating at veterans’ homes, correctional facilities and homes serving the developmentally disabled. However, Nuding cautioned against a stopgap budget, saying kicking the can down the road is not a viable option.

Further exacerbating the tension in the Statehouse, House Democrats, led by Speaker Michael Madigan, rushed a 500+-page budget document through the House, giving members mere hours to review the spending proposal, which GOMB projects is about $7.5 billion out of balance.

A Rauner administration official called the spending plan, “the phoniest phony budget in recent Illinois history – and that’s saying something.” The measure is currently pending in the Senate, but the Governor has indicated he’ll veto the budget if it hits his desk.

Nuding noted that contrary to claims the Governor could veto out spending to balance the budget, in many areas the administration’s hands are tied. In fact, nearly $22.5 billion in state obligations, or 70 percent of anticipated state revenues, cannot be reduced without changes to state law. These obligations include payments on debt service bonds, Medicaid and pension payments, transfers to local government and state employee health insurance costs, among others.

Republican lawmakers are trying to remain optimistic a budget proposal can be negotiated in the next several days, noting “working groups” plan to continue meeting over the weekend. However, many expressed disappointment that Speaker Madigan indicated there was no progress made by these lawmakers who have been meeting in working groups for weeks, trying to find solutions to the budget impasse, forge common ground on reform items and identify ways Illinois can increase revenue.

Contrary to Speaker Madigan’s claims, many lawmakers have said there has been bipartisan progress in a number of areas. In fact, during a Senate GOP press conference this week, lawmakers noted that while rank-and-file members of both parties have been negotiating together in good faith, any positive progress has been stalled by the Speaker.

Republican lawmakers and the Governor are pushing for reforms as part of the final budget compromise. Pointing to the Democrats’ 2011 tax increase—after which Illinois still had a multi-billion dollar bill backlog, the state’s credit ratings were reduced to the lowest in the country and unfunded pension liabilities skyrocketed—Republicans say a tax increase alone won’t solve the state’s problems.

Illinois is just days away from once again ending the spring session. The last time the General Assembly passed a budget, although not a balanced one, was May 15, 2014, over two years ago.

Senate advances flawed education funding measures

Multiple proposals were advanced by the Illinois Senate this week that would change the way education is funded in Illinois, efforts that Republican Senators characterized as rushed attempts to drive additional dollars to Chicago Public Schools.

Lawmakers were given very little time to review the measures, House Bill 3190 and House Bill 813, abbreviated timelines Republican lawmakers criticized in light of the importance of the proposals.

Though House Bill 3190 incorporated elements of an “evidenced based” education funding model that is generating support from lawmakers from both parties, the proposal still directed hundreds of millions of dollars to CPS for the district’s controversial “Chicago Block Grant” and a $205 million pension payment—meaning it still includes at least $750 million in special deals for the Chicago Public School system. Critics of the measure also noted that due to the haste with which the legislation was rolled out, the Illinois State Board of Education (ISBE) was not able to determine what impact the proposals would have on local school districts.

Another school funding measure, House Bill 813, that was rushed through the Senate would also change the school funding formula—and direct hundreds of millions of dollars in additional state dollars to Chicago.

Republican lawmakers have remained engaged in efforts to reform the state’s system of funding education. However, they maintain they will not support any legislation that places the interests of Chicago Public Schools ahead of every other student in the state. Instead, Republican legislators have joined the Governor in calling for full funding of General State Aid for schools, which would end the seven years of deliberate underfunding of schools advanced by Democrats.

Though the legislation lacked Republican support, it was advanced to the Senate floor for consideration by the full Senate body.

House fails in bid to override Governor’s veto of binding arbitration bill

The Illinois House of Representatives voted this week to override Gov. Rauner’s veto of SB 580, known as the binding arbitration bill. The measure fell short by two votes.

A second attempt pushed by Illinois Democrats to change the process of negotiating labor agreements, was vetoed by Governor Bruce Rauner on May 16.

Known as a controversial “binding arbitration” measure, this spring Democrats revived previous efforts to place the process of determining the outcome of taxpayer-paid, multi-billion-dollar labor agreements between the Governor and state employee unions in the hands of an unelected arbitrator.

Republican lawmakers largely voted against House Bill 580, which removes a duly-elected governor from union negotiations in the event of a contract dispute. Critics of the proposal noted it is the job of the Governor, elected by the people of Illinois, to negotiate in good faith as a representative of the taxpayers.

Additionally, locally-elected union representatives would also be removed from the process, and critics questioned a provision in the legislation that would have removed the union’s ability to strike.