Governor Ryan Urges Legislature to Solve Budget Crisis

SPRINGFIELD -- Governor George H. Ryan today briefed the leaders of the General Assembly on the sharp decline in revenues since September 11th, and urged them to come together to solve the budget crisis.

The Governor reminded the legislative leaders that he has cut the size of the state budget by $1.4 billion since the 2001 fiscal year, through administrative cuts without assistance from the General Assembly. Unless the General Assembly can come together on a plan to balance the state's budget, future cost containment measures imposed by the Governor could include closing or curtailing operations at 42 state facilities, and providing an early release for 4,500 non-violent drug offenders nearing the end of their sentences in Illinois prisons.

In February, Gov. Ryan introduced an austere budget that called for $725 million in spending cuts for the 2003 fiscal year. Since then, the state's revenue picture has worsened. Revenue receipts for the 1st quarter of this year are $270 million less than last year. Last week, the Bureau of the Budget, House and Senate budget negotiators and the General Assembly's Economic and Fiscal Commission all agreed that revenues for FY '02 will likely be $650 million less than what was expected in February. They also agreed it is likely there will be lower than projected revenues in the first quarter of FY '03.

"The cumulative effects of these three factors means that our ‘budget hole' is now at least $900 million, without even taking into account the $250 million loss to state revenue from the federal stimulus package or the nearly $400 million in increased spending proposed by the House last week," Gov. Ryan said. "We have to get serious about how to deal with the 2003 budget."

Governor Ryan has also met with Comptroller Dan Hynes and Treasurer Judy Baar Topinka and is proposing that the General Assembly give them new cash management authority. The Treasurer has several billion dollars in the bank that could be used to maintain a responsible General Revenue Fund Balance and pay bills more promptly. However, the Treasurer can only do so with approval of the legislature.

The budget proposed by Governor Ryan included the closure of several state facilities, a 1-day furlough plan for all state employees, privatization of prison food service and the reduction of the state workforce of 3,700 positions. AFSCME, which represents 45,000 state workers, has fought the furlough and privatization plans in court, and just last week House Democrats added nearly $400 million dollars to the Governor's proposed budget.

"Your members have to understand that we are looking at a budget deficit that is about $1.2 billion worse than we thought just 2 months ago," Gov. Ryan said. "AFSCME and some legislators are in absolute denial."

In the meantime, absent an agreed-upon budget package, the Governor has asked his largest agencies for additional cuts. They include closing all or part of several facilities in the departments of human services, corrections and natural resources as well as more layoffs. The early release of the non-violent drug offenders would occur for prison inmates with seven months or less of their sentence remaining.