Fw: Arc and Dems Struggle to Beat Tax Hike Clock

[Guest guest]

FYI

Ellen

Ellen Garber Bronfeld

egskb@...

Arc and Dems Struggle to Beat Tax Hike Clock

The Arc of Illinois

January 4, 2011

Leaders in The Arc:

Make sure you make your calls to the Capitol today supporting new revenue!

The Governor and the Democratic Leaders met yesterday to discuss new revenue and

those discussions will continue today. They are talking about new revenue

options I have been sharing with you for quite some time. They include increase

the income tax by 1% or 2%, either temporary or permanent. They are also talking

about other new revenue and further budget cuts.

See story from the Chicago Tribune on the Governors meeting yesterday.

Today, I meet with the Illinois Council of Executives of The Arc to discuss

managed care and other important issues.

Tony auski

The Arc of Illinois

815-464-1832

Top Dems struggle to beat tax-hike clock

Lame-duck session ends soon, but devil in details: 1 or 2 percentage points?

Would it get GOP votes?

By , Ray Long and Todd , Tribune reporters

10:00 PM CST, January 4, 2011

SPRINGFIELD Top Illinois Democrats huddled behind closed doors for hours Tuesday

as they scurry to piece together a major income tax increase to ease the state's

long-festering budget woes before a rapidly closing window to get something done

shuts in a week.

For Gov. Pat Quinn, House Speaker Madigan and Senate President

Cullerton, the sticking points are substantial: How big a tax hike should be,

how long it should last and how the money should be spent.

While more discussions are scheduled for Wednesday, prospects for a tax increase

aren't much further along than they were a year and a half ago. The Senate

already approved one, but the lingering question is whether Madigan will push

ahead in his Democrat-controlled House if Republicans won't put enough votes on

it.

As is often the case, Madigan wasn't saying much. " We expect that there'll be

some support from the other side of the aisle, " Madigan said as he departed an

afternoon legislative hearing.

But internal polling of Madigan's House Democrats showed significant support for

a temporary 1-percentage-point increase in the state's 3 percent personal income

tax rate, with some arguing the hike would be too small to fix Illinois'

long-term budget imbalance, said a source familiar with the vote-counting effort

who was not authorized to speak publicly.

There's also the usual partisan acrimony. In hopes of getting a few Republicans

on board, Democrats are dangling workers' compensation reforms to ease the

burden on businesses and moving low-income Medicaid recipients into managed

health care programs.

House Republican leader Tom Cross of Oswego said he believes Democrats simply

are seeking cover for a tax hike by floating those ideas as well as a proposed

state constitutional amendment to limit government spending.

" I think it's clear (Democrats) are attempting to make a case that they believe

will justify their raising of the income tax by as much as 66 percent and they

will do that by limited reform in the areas of Medicaid and workers' comp, "

Cross said. " But they woefully fall short on pension reform, limiting spending

and even some more cutting. They've really done nothing on (creating) jobs. "

The rush to act is the result of the calendar. The Capitol is in the final

throes of a short lame-duck period before a new General Assembly is sworn in

Jan. 12.

Many Democrats were reluctant to champion a tax hike before they won re-election

in November, but some of those will likely be relied on for votes to pass any

tax hike now. After years of frustration over the budget, the tension was

palpable.

" Whatever we're going to do, I want to get the damned thing over with, " said

Rep. Joe Lyons, D-Chicago. " We've got a short period of time before the lame

ducks are no longer ducks on the pond here. So we've got to do something in the

next few days. I'm willing to go along with almost anything as long as we move

forward on this. "

Quinn has been uncharacteristically silent as he works with legislative leaders.

Since taking over for ex-Gov. Rod Blagojevich nearly two years ago, Quinn has

been criticized for quickly proposing tax increases but not sticking to any one

plan, for laying down ultimatums and then backing away.

The governor also is floating the idea of borrowing approximately $14 billion,

to be repaid over 14 years, largely to catch up on a backlog of unpaid bills,

fully fund state worker pensions this budget year and help pay the costs for

next year, a key lawmaker said. The borrowing would be repaid by raising the

income tax rate by a quarter- or half-percentage point, above any other tax hike

lawmakers might approve.

Quinn declined to talk to reporters Tuesday, heading back to the governor's

mansion for a second night of cocktails with a small group of lawmakers.

Democratic leaders are trying to craft a plan that can get enough votes in the

House because the Senate already approved a measure in May 2009 to permanently

raise the income tax rate to 5 percent.

The problem is trying to fit the right pieces into a complex puzzle. One idea

would be a temporary tax increase of two to five years that would raise the

income tax rate by up to 2 percentage points. That would be used to drive down

the budget deficit and stabilize the state's finances.

These broad outlines remained " pretty accurate, " Cullerton said Tuesday night in

his Capitol office.

One factor that could hurt Democratic support is Quinn's reluctance to agree to

limit state spending at current-year levels or lower. A spending cap has been a

condition for some downstate Democrats to back an income tax hike.

Rep. Mark Beaubien, R-Barrington Hills, said he believes a couple of Republican

lawmakers are leaning toward supporting an income tax hike, even if " the vast

majority " will oppose. He blamed the lack of interest partly on Democrats for

running up the spending under Blagojevich and Quinn since 2003, with Republicans

mostly on the sidelines during that time.

" We've had eight years in the wilderness, " Beaubien said. " We did not create the

problem. If (Democrats) want to pass the income tax increase, they can do it. "

Cullerton would not predict whether a tax increase would pass, but he tried to

temper a potential backlash from a tax-weary public. A key decision will be how

the funds from a new tax hike would be distributed, whether some would go to

education or all of it to help relieve the $8 billion backlog of overdue bills.

" I think it depends on how people look at it, " Cullerton said. " I think what we

have to do is pay off bills. That's a huge, important part of our national image

as well as importance to our economy. "

Lyons conceded that taking a tax-hike vote now could have widespread

repercussions. Lawmakers will be running in newly drawn districts following the

results of the new U.S. census. And few are itching to give any future opponents

some anti-tax fodder to use in the 2012 campaign.

" It's political suicide for a lot of people, and we all know that, but the right

thing has to be done here, " Lyons said. " Being popular isn't always right. Being

right isn't always popular. The old cliche is so applicable toward this thing.

It's sad. "

Tribune reporter Rick Pearson contributed from Chicago.

mcgarcia@...

rlong@...

xcxtwilson@...

Copyright 2011, Chicago Tribune

www.chicagotribune.com/news/local/ct-met-illinois-legislature-0105-20110104,0,21\

31597.story

chicagotribune.com

Please click here to be removed from our list. If you still receive emails from

us in the future, please ensure it was not forwarded from another party or sent

to an email address that is different than the one asked to be removed. DO NOT

REPLY TO THIS EMAIL. Or write us at:

The Arc of Illinois

20901 S. LaGrange Rd. #209

fort, IL 60423