Unmoved by a two-month blitz of TV ads and rallies, the Illinois House on Thursday resoundingly rejected Gov. Rod Blagojevich’s plan for a $7 billion business-tax increase and immediately began discussing alternatives for solving the state’s fiscal mess.
The second-term Democrat was unbowed in the face of one of his biggest political setbacks, and he pledged to keep pushing for his new tax on business revenues to bolster schools and expand health-care coverage. He said the most discussed alternatives — raising income or sales taxes — were “off the table.”
Blagojevich had sought to blunt the impact of the vote by suggesting beforehand that he wanted lawmakers to reject the referendum on his plan. But after the roll call he used a rally in Chicago to accuse legislators of being too cozy with business interests who “eat fancy steaks” and “shuffle around in Gucci loafers.”
“Your lawmakers in Springfield sometimes forget where they came from. Sometimes they forget who hired them,” Blagojevich said. “Waiting outside that chamber, where the people are supposed to have their representatives do their job, are all these high-powered lobbyists twisting their arms.”
House Speaker Michael Madigan (D-Chicago) engineered the vote on a non-binding resolution that asked lawmakers whether or not they supported the governor’s plan. The result was a striking 107 opposed, zero in favor and seven voting “present.”
Madigan called on House Democrats to return next week to discuss whether they would support another tax increase, how big it should be and where the money should be spent.
Madigan’s political power play was a clear signal that he is moving past the governor’s proposal. But Senate President Emil Jones (D-Chicago), who huddled privately with the speaker on Thursday morning, remained foursquare behind Blagojevich.
Many of Jones’ closest legislative allies are getting antsy to reach a compromise, amid a growing fear that Democrats who control state government are speeding toward a bitter gridlock that will go well beyond the legislature’s May 31 adjournment deadline.
Madigan has said a tax increase is needed this spring but has declined to say what he would endorse. Voicing his opposition to the gross-receipts tax for the first time, he maintained the governor’s proposal amounted to a “regressive” tax that would hurt consumers as well as businesses.
Blagojevich helped build up the number of no votes against his plan when it was clear he was headed to certain defeat. With lawmakers predicting his proposals might not even garner two votes, Blagojevich issued an 11th-hour statement asking all lawmakers to vote against his plan.
“So we are asking all members to vote ‘no’ to send a clear message that this issue is too important for a rush to judgment on a non-binding resolution,” Blagojevich wrote.
But the vote also provided an outlet for lawmakers frustrated with Blagojevich’s style of public campaigning for big-picture programs with little regard for negotiating the details with the General Assembly.
Lawmakers scoffed at the governor’s last-minute missive, saying he was trying to put a positive spin on what was clearly going to be a major defeat.
Many Republicans, who had no intention of supporting Blagojevich’s tax plan, hung small signs on the back of their laptop computers reading, “No means No Governor!”
Democrats said the plan is now toxic.
“It’s like Kryptonite,” said Rep. Julie Hamos (D-Evanston), who had considered voting for the governor’s tax plan.
Gridlock feared
Blagojevich’s chief House ally, Rep. Jay Hoffman (D-Collinsville), called Madigan’s resolution a “charade” and said he feared it could lead to gridlock that would force an austere budget without the revenue to support new spending.
Still, Hoffman said he couldn’t support Blagojevich’s plan in its present form.
Rep. Lou Lang (D-Skokie), who is pushing for increased gambling to raise revenue, implored the governor and lawmakers to “get past the speed bump of gamesmanship, to get past the speed bump of partisan politics, to get past being told what we are going to do, and taking the bull by the horns and stating what we think we should do to move the state of Illinois forward.”
Emboldened by the House vote, Senate Republicans demanded an immediate roll call on the governor’s tax legislation in the Senate.
“I believe we have the votes here to immediately kill” it, said Sen. Bill Brady (R-Bloomington).
But Jones rejected their request.
“The easiest thing you can do in the General Assembly is to say what you are against,”‘ Jones said. “But sometimes in life you have to be for something.”
Alternatives pushed
Afterward, a top Jones deputy, Senate Majority Leader Debbie Halvorson (D-Crete), suggested it is time to consider a “Plan B,” which might be a mixture of other taxes.
Clearly energized by the House vote was Sen. James Meeks (D-Chicago). His attempts to push a plan that would swap higher income and sales taxes for reduced property taxes have stalled in the Senate even though a companion effort is progressing in the House.
Meeks maintained that the loss of the governor’s plan in the House makes his so-called tax-swap proposal the “most viable option.”
Jones still does not support it, said Cindy Davidsmeyer, Jones’ spokeswoman.
The governor wants a tax on business revenue at every step in providing services or products, with exemptions for firms with $2 million or less in annual revenue. He said tax credits would help firms with revenue up to $5 million.
Rep. Gary Hannig (D-Litchfield), Madigan’s point man on budget issues, said he might be able to support a gross-receipts tax if the threshold were $100 million or $200 million — a move that would target only major corporations.
Even so, House Minority Leader Tom Cross (R-Oswego), who co-sponsored the resolution on the governor’s plan, said he doesn’t think his caucus will support any new taxes this year, especially not a modified gross-receipts tax. He said House Republicans want lawmakers to find ways to cut costs.
Despite the day’s events in Springfield, Blagojevich characterized the lopsided vote as a positive development.
“Today, I think, was basically an up … I feel good about it,” he said.
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rlong@tribune.com
