Coronavirus crisis puts state billions in the red
Pritzker calls for additional federal aid, says fair tax is needed ‘now more than ever’
Gov. Pritzker discusses the fiscal impact the coronavirus crisis has had on state finances, backed by Deputy Gov. for Budget & Economy Dan Hynes. (Illinois.gov)
By Ted Cox
Gov. Pritzker laid out the dire financial straits the state has been placed in by the coronavirus crisis on Wednesday, but committed to a state budget based on “an unswerving dedication to fairness.”
At his daily coronavirus briefing at the Thompson Center in Chicago, Pritzker said state revenue is projected at $2.7 billion less than what was forecast for this fiscal year, ending with June, and $4.6 billion less for the next fiscal year beginning in July. According to a news release put out by the Governor’s Press Office, “With short-term borrowing to bridge through this crisis, the total shortfall for fiscal year 2021 is $6.2 billion when compared to the spending plan put forth by the governor in February.”
“Folks, you don’t have to be an epidemiologist to see that the virus is going to hit our budget — hard,” Pritzker said. “This is a public health crisis — but it is accompanied by massive economic disruption that’s unprecedented in modern history. Illinoisans are all too familiar with the pain the lack of a state budget can cause, so let me just say up front — we will not go without a state budget.
“We will need to make extraordinarily difficult decisions on top of the difficult decisions we’ve already made,” he added, “but together with the state legislature we will make them and we will do so with an unswerving dedication to fairness. In the midst of a pandemic, I am more resolute than ever to protect those who are suffering physical and financial hardship from it.”
The governor said his Office of Management and Budget had already ordered all state agencies “putting on hold all nonessential purchases and operational expenditures, freezing all travel that is not mission-essential, and limiting all nonessential hiring.” He praised Treasurer Michael Frerichs and Comptroller Susana Mendoza for “creative” solutions extending investment borrowing agreements and interfund borrowing. He’ll also be borrowing $1.2 billion in the short term, in part to make up for the delayed income-tax deadline, moved from April 15 to July 15.
“Illinois, when I said that we’re all in this together, that’s true,” Pritzker said. “From Cairo to Chicago, from Rockford to Metropolis, we are one Illinois. But it’s also true across the country, we are one nation. And as a nation made up of the 50 states, we are facing by early estimates state budget deficits of at least $500 billion.”
Pritzker called for additional federal aid to the states in another relief package, saying, “We ask for Congress to do for the states what it alone can do to get us through this crisis together.”
The governor also cited estimates showing that the overall $6.2 billion state budget shortfall next year would climb to $7.4 billion if voters fail to endorse the fair tax on the ballot in November. “I would argue in a way that we may need it now more than ever,” Pritzker said. “Of course, this isn’t just about one year. It’s about fixing the structural deficit that exists for the state. … We have many years ahead, and I think a fairer tax system makes sense to me.”