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Governor Makes Gloomy Forecast For Ill. Budget

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Illinois State Capitol

Illinois State Capitol buillding in Springfield (AP Photo)

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SPRINGFIELD, Ill. (AP) — The long-term forecast for the Illinois budget looks gloomy, with less state money available and government services facing cuts, Gov. Pat Quinn’s office said Tuesday.

Quinn’s three-year projection shows state revenues climbing for two years and then dropping sharply when the state income tax increase expires. More federal money could make up the difference, but Illinois government would wind up with roughly the same amount to spend in 2015 that it has now: a little over $33 billion.

Meanwhile, expenses will keep climbing unless officials take action.

The state’s contribution to government pension systems is projected to grow 43 percent, to about $5.9 billion. Quinn’s forecast shows health care costs holding steady, but that assumes something happens in the next few years to control expenses. Without that, Medicaid costs could rise by hundreds of millions of dollars a year.

“Our revenue growth is not enough to keep up with pensions and Medicaid. It creates a squeeze for everything else,” said Quinn’s budget director, David Vaught.

Education and related programs will be caught in that squeeze, Quinn said. His projection calls for holding education spending flat at $8.9 billion for the next three years.

Public safety programs could fall by 8 percent, to $1.4 billion. Services to the poor and vulnerable could take a 5 percent tumble.

The three-year budget forecast is part of a new initiative meant to control state spending and focus on the most important government programs. Called “Budgeting for Results,” the initiative is supposed to identify how much money is available and then trim spending to meet that target, instead of the more traditional Illinois approach of deciding how much to spend and then scrounging for the money.

One leader on the “Budgeting for Results” process, Sen. Dan Kotowski, called the long-term projections an “essential” part of stabilizing the budget.

“Fund what works, get rid of what doesn’t,” the Park Ridge Democrat said. “This is our way to end the reckless spending policies of the past.”

The figures Quinn released Tuesday are simply projections. The numbers could change if the national economy picks up or officials take action, such as making the tax increase permanent or cutting back Medicaid services.

Vaught wouldn’t say what action Quinn thinks will be necessary. But he said the Democratic governor wants to work with both parties on deciding what to do next.

Senate Minority Leader Christine Radogno, R-Lemont, noted the new report shows a budget deficit of $507 million this year, not counting the state’s billions of dollars’ worth of unpaid bills. She said Quinn and other Democratic leaders should work with the GOP on further cost-cutting.

“We will be there for any sincere discussion on bringing spending under control, revisiting how services are delivered and restoring some fiscal stability to Illinois,” Radogno said in a statement.

(TM and © Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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