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Illinois

New Rauner Budget Relies On Tax Hike He Opposed

Rauner.jpg
Brian Mackey/NPR Illinois
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Illinois Gov. Bruce Rauner has been campaigning relentlessly against last year’s income tax increase but, in his annual budget address today, he'll call for spending the extra money that rate hike has generated.

Rauner wants more money to go to education and less to be spent on things like prisons and the judiciary.

According to a preview document obtained by public radio, the governor will not call for an immediate rollback of the tax increase.

The day before, Senate President John Cullerton, a Chicago Democrat, predicted that would be difficult: “If he wants to cut the income tax by 1 percentage point, that equates to $3.7 billion in lost revenue.”

Rauner seems ready to acknowledge that reality, though he is proposing what he’s calling "a path to a tax cut.”

He’d make major pension changes using Cullerton's "consideration model" — in which state employees, public school teachers and university workers would agree to lower pension benefits in exchange for something of value.

Rauner would plow the savings from that pension-cost reduction into a tax-rate cut of a quarter of one percentage point; but the plan — and tax cut — could be delayed for years while they're challenged in court.

Even if that does get through the legislature and courts, it’s still a long way from Rauner’s stated goal of lowering taxes by nearly 2 percentage points.

Other aspects of his budget plan also could be challenging: Rauner needs Democrats to abandon their belief that public employee unions should be allowed to negotiate over health-care benefits.

He also wants to sell the Thompson Center in Chicago for a few hundred million dollars. The thing is, the expected savings from that already arecounted in this year’s budget and, generally, buildings can be sold only once.