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June 2, 2008

Gov. Blagojevich announces General Assembly’s Fiscal Year 2009 budget unbalanced, unconstitutional
Governor urges all four leaders to join negotiations on operating and capital budgets Initial review shows House inaction on new revenue leaves FY09 budget $2.1 billion in the red

CHICAGO – Governor Rod R. Blagojevich announced today that after an initial review, his budget experts have found the Fiscal Year 2009 budget passed by the General Assembly on Saturday to contain $2.1 billion more in spending than anticipated revenue will support, making it unconstitutional.  The Illinois State Constitution requires the legislature to pass a balanced budget.  The Governor said he will call the four legislative leaders together this week to resume work so the people of Illinois will have a budget that fulfills constitutional requirements and meets the state’s needs by July 1. 

“As consumer prices go up and wages stay the same, households across Illinois and across the whole country are making tough decisions.  Some people may cut back on expenses, or pick up extra shifts at work – whatever it takes to make ends meet.  Our lawmakers should take the same responsible approach when it comes to budgeting the public’s resources.  Unfortunately, because the House did not pass new revenue as the Senate did, I have a budget on my desk that jeopardizes the State’s ability to meet its core responsibilities like providing healthcare, educating our youth and protecting the public,” said Gov. Blagojevich.

The new budget lawmakers approved for Fiscal Year 2009, which begins on July 1, includes a $1.2 billion increase in spending over the Governor’s FY2009 introduced budget.  The General Assembly’s budget does not include $875 million of new revenue contained in the Governor’s proposed FY09 budget, leaving it $2.1 billion in deficit.

The Illinois Constitution states that the General Assembly “by law shall make appropriations for all expenditures of public funds by the State. Appropriations for a fiscal year shall not exceed funds estimated by the General Assembly to be available during that year.”

While the Illinois State Senate passed two new revenue sources, the House failed to adopt them. Those revenue sources included $530 million through transfers from special purpose funds, and $400 million which would have been freed up through a refinancing of the state’s pension debt. 

The Governor warned lawmakers that more work will be required to ensure the state can afford to meet its obligations and serve the public in the fiscal year ahead.

“This budget will not be final until it is balanced.  Lawmakers, especially those in the House, have more work to do in order to enact an operating budget that’s balanced and a capital bill that will put people to work and fix our aging infrastructure.  I will call a meeting with the four legislative leaders this week to resume the work necessary to make sure we have met our responsibility to the people of Illinois before the new fiscal year begins on July 1.  It’s imperative that all four leaders take equal responsibility for ensuring we can pay for new spending, and can meet the state’s most pressing needs.  To date this year, that responsibility has not been shared evenly,” the Governor added.

After the state Senate approved new revenue mechanisms in conjunction with the increased spending plan, the House pushed through the spending plan without passing the Senate's proposals to provide revenue necessary to pay for it.

In early March, Gov. Blagojevich appointed former Republican US House Speaker Dennis Hastert and former Democratic US Congressman Glenn Poshard as co-chairs of the Illinois Works Coalition.  The duo focused on crafting and passing an infrastructure and jobs bill that would address pressing capital needs that have built up since the last public works plan was passed nine years ago.  The co-chairs facilitated regular meetings with the Governor and four legislative caucuses to draft a capital plan that could be acceptable to all participants.  Three of the four leaders participated in those negotiations. In the end, the House Democratic leadership used procedural maneuvers to kill the negotiated capital plan before it could be voted on by the full House. 


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