Gov. J.B. Pritzker recently made his annual budget address, in which he touted the improved fiscal condition of the state as well as roughly $1 billion in extra revenue.
Some of the highlights include providing financial relief to taxpayers by freezing taxes on gasoline and groceries. This is expected to cost the state $135 million (in forgone gasoline revenue) and $360 million (in forgone tax receipts on groceries, which the state will make-up to municipalities who get most of that tax revenue).
Even with those expenses, the proposed budget still allows the state to allocate a $500 million bonus pension contribution as well as roughly $879 million into the rainy day fund (the state’s primary savings account).
As The Chicago Tribune has noted, this phenomenon is the first time in 18 years were the state made such a contribution. So, let’s go back in time to what state government was like in 2004.
Rob Blagojevich was midway through his first term as governor and Democrats were in their second year of controlling both chambers for the first time since 1989. The Executive Branch also included the likes of Lt. Gov. Pat Quinn, Attorney General Lisa Madigan, Sec. of State Jesse White, and Comptroller Daniel Hynes.
Hynes, who was first elected in 1999, was swept into office pushing an agenda of transparency in budgeting, fiscal responsibility, and paying down debt. The following year, he was instrumental in helping create the Budget Stabilization Fund, the state’s modern rainy day fund. According to the Civic Federation, Illinois was only one of five states that did not have such a fund at the time.
The state originally deposited about $226 million into the fund using revenue from the tobacco settlement recovery fund. Contribution to the fund was neglected until 2004, where the state allocated roughly $50 million.
That infusion, however, was short lived. By 2013, there was still only $276 million sitting there, equating to less than 1 percent of General Fund revenues, according to the Civic Federation.