The General Assembly ended its longest and most fractious spring session in decades early Friday, renewing the state`s income-tax surcharge, curbing Chicago-area property-tax growth, completing a stripped-down $26 billion budget and approving an expanded McCormick Place.
Republican Gov. Jim Edgar, who gained much of what he wanted in his campaign-driven, first-year agenda, said the bipartisan tax-and-budget package approved by the House and Senate would ”move the state ahead” after weeks of political divisiveness involving the Democratic-controlled legislature.
”We`re now in a position where we`ve put the state on the soundest fiscal footing you can,” Edgar said. ”I think we`re in as good a shape as we can be considering the financial problems we`ve faced.”
Senators also voted 31-23 to approve a nearly $1 billion plan to expand Chicago`s McCormick Place exhibition center through a mix of Chicago and Cook County convention-related taxes to be imposed next year. The House later approved the measure 65-44.
Lawmakers sidestepped perceptions that it would be inappropriate to approve a nearly $1 billion public works project at a time when the state was cutting social services, approving an almost doubling of expansion space at McCormick Place through a mix of Chicago and Cook County taxes to be imposed next year.
Those taxes include city levies on hotels and meals within a restaurant taxing district, new fees on Cook County auto rentals and taxes on commercial rides to and from O`Hare and Midway Airports.
The House voted 63-44 against another version of the McCormick Place measure, linked to $350 million in water and school repair projects for Downstate communities, funded by legalizing video poker machines in bars.
In a flurry of action after a 2 1/2-week partisan impasse over the budget, lawmakers adjourned at 12:08 a.m., early into the 19th day of an extended spring session that became a test of wills between the Republican governor and powerful Democratic House Speaker Michael Madigan of Chicago.
In the end, a patient and disciplined Edgar succeeded in advancing a state budget dependent upon a mix of $1.5 billion in spending cuts, fund transfers and speeded-up tax collections. Edgar adhered to his campaign pledge to approve no new taxes beyond extending the surcharge, cutting spending and providing property-tax caps in the suburbs.
Setting the pace toward adjournment, the Senate voted by a better-than-expected 43-13 margin to send Edgar the surcharge legislation, the key component of a budget compromise worked out between the governor and the legislative leaders.
Passage of the measure released a flood of legislation that had been dammed up behind the partisan legislative impasse that had kept Illinois without a budget for more than two weeks into the new fiscal year and resulted in the first payless paydays for state employees in 60 years. The comptroller`s office planned to work this weekend to get checks to more than 21,000 state workers.
The budget agreement reached between Edgar and the legislative leaders would make $800 million in program cuts to help get Illinois` government through a recession-tinged economy this fiscal year.
Also among the legislation sent to Edgar was a measure pushed by the state`s coal industry and union miners. The bill would require Commonwealth Edison Co. to burn Illinois coal and meet federal Clean Air Act modifications but also would increase consumers` electric bills by up to 5 percent.
In a session colored by the impending partisan redrawing of the state`s political boundaries, the new budget and the surcharge plan clearly left distaste in the mouths of legislators used to spending rather than cutting, with few pork projects to bring home to their districts.
”This reminds me of a dead carp along the Illinois River at moonlight,” Sen. Patrick Welch (D-Peru) said of the surcharge plan. ”It shines and stinks at the same time.”
Republicans, however, sensing imminent political victory not only for the governor but for themselves, chose not to gloat but urged support for the surcharge and budget compromise to bring the spring session to an end.
”On this late day in the month of July, I think we have little choice but to accept this compromise,” said Sen. Jack Schaffer (R-Cary). ”It`s not enough. Perhaps it will never be enough. But it`s better than what we could have done if we didn`t pass the surcharge.”
Despite the large number of Senate votes for the plan, most Cook County Republicans and Democratic minority lawmakers from Chicago opposed the bill, claiming their respective constituencies would suffer for different reasons.
”I am jealous of my colleagues in Du Page, Kane, Lake, Will and McHenry Counties. They united to help their constituency, their property owners,”
said Sen. Walter Dudycz (R-Chicago). ”I sincerely believe that the homeowners of Chicago and of Cook County are get program cuts contained in the state`s fiscal plan would be disastrous to his constituents.
”I know it`s July the 18th and I know we want to go home, but . . . I would rather spend another week, another two weeks, another month in Springfield than impose these hardships on the people of Illinois,” he said. Included in the $1.5 billion in cuts were an $800 cap on state circuit breaker assistance to the elderly and disabled for the purchase of
prescription drugs, the reduction in general assistance benefits to welfare recipients deemed ”employable” from one year to nine months this year and only six months after that and the elimination of energy assistance to the poor.
Under the new surcharge measure, endorsed a day earlier on a 72-42 House vote, the state`s income-tax rate would be permanently increased for the first time since it was imposed in 1969, by 10 percent to provide $395 million to education.
At the same time, the income tax would be boosted another 10 percent for the next two years to provide funding to local governments and to help infuse some cash into the state`s dollar-depleted treasury. The municipal and state share would be split 50-50 this year and 75-25 in favor of local governments in 1993.
The legislation also would impose a cap of 5 percent or the rate of inflation, whichever is less, on the annual growth of property-tax collections by local non-home rule taxing bodies in Du Page, Will, Lake, Kane and McHenry Counties.
Voters could enact a higher collection rate, but the measure exempts most bonding projects implemented before the law would take effect Oct. 1. New construction in high-growth areas also would be exempted from the cap.
The proposal also would impose a one-year freeze on property assessments in Cook County using 1991 as the base year for 1992 taxes. The Cook County Board also could decide to spread property-tax bills over four payments, rather than the current two, to reduce the tax shock felt by many homeowners. In addition, the legislation would allow municipalities, including Chicago, to impose a tax of up to 5 percent on interstate phone calls for the next two years in an effort to help cities recoup money they would lose from the surcharge. The measure would generate up to $20 million for Chicago.
Under the two-year surcharge, which expired July 1, education and municipalities had divided about equally its $700 million in annual revenue. But the new surcharge distribution approved by the General Assembly would retain education`s share and make it permanent, while cutting the local government`s share in half this fiscal year.
Final passage of the surcharge and property tax measure spurred the General Assembly into approving new fees on hospitals and nursing homes to recoup matching federal funds to pay medical providers for treating the indigent.
Lawmakers also approved a way for the state to pay off over three years more than a half-billion dollars in overdue bills to Medicaid providers for services incurred last fiscal year, through an off-the-books borrowing mechanism.
