Continuous Summer Session Update

The Illinois General Assembly was in session yesterday for the third consecutive week with no significant action taken on the budget. With just two weeks remaining in the FY15 fiscal year, there are concerns about whether a budget deal will be struck before June 30. The FY16  budget passed by the General Assembly has yet to be sent to the governor for his signature or veto. The governor continues to demand action on his Turnaround Agenda before he will discuss revenue options to balance the budget that was passed by both chambers. The legislative leaders, particularly Speaker Madigan, continue to dismiss the proposals in the Turnaround Agenda as non-budgetary.

Week-by-Week Overview
In the first week of the overtime session, the House convened as a Committee of the Whole to discuss workers’ compensation reform. A Committee of the Whole operates like a regular committee except all members of the chamber meet as one group to discuss an issue, hear testimony and ask questions of the witnesses. During the overtime session both chambers have used this process to discuss various topics of the governor’s Turnaround Agenda and other budgetary issues.

During the second week of the overtime session, the House and Senate both convened on Tuesday and announced they would meet each Tuesday in the month of June.

The Senate met as a Committee of the Whole to discuss a property tax freeze. Senators heard testimony about the impact of a property tax freeze across state government and specifically about the impact on local school districts. Tony Sanders, Chief Education Officer of Elign U-46, and Superintendent Jerry Mitchem of Valley View CUSD 365U discussed how property taxes are the most stable, reliable funding source districts have and how freezing a district’s ability to raise local revenue, particularly in such uncertain times with the state budget, would be a significant burden on local districts.  Brent Clark, Executive Director of the Illinois Association of School Administrators, and Robin Steans from Advance Illinois also testified on the impact a freeze would have on education funding. Senate President John Cullerton has publicly stated there may be some common ground with the governor on property tax relief if it is coupled with some kind of fundamental school funding changes.

The House took two votes on property tax freeze bills, HB 690 and HB 691. HB 690 (Franks) was similar to the governor’s proposal, but did not put restrictions on prevailing wage and collective bargaining. It failed 41-23-34.  The House then voted on two amendments to HB 691 (Bradley).  Amendment #1 contained the governor’s property tax freeze language and was adopted on a vote of 44-21-33.  Amendment #2 contained restrictions on prevailing wage and collective bargaining that the governor wants and this amendment failed on a vote of 0-69-26.  There was no vote on the underlying bill so HB 691 remains on the floor of the House and could be considered for future action.  The IEA is opposed to both of these bills.

This week, the Senate met in another Committee of the Whole to focus on college affordability in Illinois. There were representatives from the Illinois Board of Higher Education (IBHE), the Illinois Community College Board (ICCB) and the Illinois Student Assistance Commission (ISAC), as well as speakers from the following higher education institutions and community colleges: University of Illinois, Western Illinois University, Danville Area Community College and Spoon River Community College. The speakers addressed the issue of funding as well as the goal of having 60 percent of adults (25-64 years of age) with a college degree or marketable credentials by the year 2025 and the need for greater efficiency to make college more affordable for minorities.

In the House, testimony was presented on the proposal to privatize the Department of Commerce & Economic Opportunity (DCEO), a state agency. Tim Schultz, DCEO Director, and John E. Greuling, President & CEO of the Will County Center for Economic Development, offered comments supporting the proposal to privatize the agency. There were also witnesses who testified from Ohio, Indiana and Florida about their experiences and challenges with privatizing similar state agencies.

Budget Timeline
Comptroller Leslie Munger will be able to continue making payments authorized under the current fiscal year, FY15, budget including the state’s existing $5 billion backlog. When the FY15 bills are paid, she will not have appropriation authority to make new payments for the new fiscal year, FY16, which begins July 1. However, the comptroller said that continuing appropriations and other legal provisions will allow her to meet some FY16 obligations including, but not limited to, pension, retiree health insurance and bond obligations of the State. Annuitant’s of TRS, IMRF or SURS will receive their monthly annuities regardless if there is a budget in place on or after July 1.

Important FY16 continuing appropriations:

  • Teachers’ Retirement System (TRS) – $3.7 billion
  • State Universities Retirement System (SURS) – $1.6 billion
  • Teachers’ Retirement Insurance Program (TRIP) – $108 million

Timeline and ramifications if a budget is not implemented by June 30:

  • June 30 – End of fiscal year 2015
  • July 1 – Beginning of fiscal year 2016
  • July 15 – State employees will start missing paychecks
  • August 10 – General State Aid payments to schools will not be delivered as scheduled

What’s Next?
Both chambers are in session again next Tuesday, June 23. The Senate plans to conduct a Committee of the Whole on minimum wage and paid sick leave. The House will continue to focus on the budget. We will continue to provide Legislative Updates throughout the summer or when the General Assembly adjourns.