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State of the State: Quinn lays out jobs plan, cloudy on funding source
By Andrew Thomason
Illinois Statehouse News
SPRINGFIELD, Ill. — Illinois Gov. Pat Quinn (D) said Wednesday, Feb. 1, that increased state spending in critical areas will spur much-needed job creation in Illinois.
But Republican legislators had harsh criticism for a plan they say will cost the cash-strapped state roughly $500 million.
During his State of the State address, which came a year after the state’s individual and corporate income tax rates skyrocketed, Quinn said he’d like to create tax credits for families and businesses, invest more money in education and upgrade the state’s aging water systems.
Quinn said his Illinois Jobs Agenda 2012 would create a more job-friendly environment in a state that has seen its unemployment rate hover around 10 percent for the past several months, about 1 percentage point higher than the national average.
But Kent Redfield, a political science professor at the University of Illinois at Springfield, said Quinn’s ideas are working around the margins. The state has $8.5 billion in unpaid bills this year, and a recent study by the Civic Federation, a nonpartisan group that focuses on the state’s fiscal health, shows that number hitting $35 billion by 2017 if drastic steps aren’t taken.
“If we don’t have the revenue, it really doesn’t matter,” Redfield said. “They’re great ideas we can’t afford. They are things we should probably be doing … but if we fall off the cliff three years from now, these things will be pretty irrelevant.”
Quinn’s jobs program must past through the General Assembly, where legislative leaders, especially those on the right, were skeptical.
Illinois Senate Republican Leader Christine Radogno, R-Lemont, and state House GOP Leader Tom Cross, R-Oswego, said the ideas Quinn laid out weren’t bad, but he ignored the state’s ailing fiscal health.
“The best thing we can do for (jobs) … is fix the state’s budget, because what happens is people looking to invest in the state see the financial disaster it’s facing and they know the other shoe is going to drop,” Radogno said.
State Senate President John Cullerton, D-Chicago, had more tactful words for Quinn.
“As he advances new initiatives to create jobs and improve the economy, I look forward to hearing how we can fund these important priorities within a balanced budget,” Cullerton said in a news release.
Specifically, Quinn proposed eliminating the natural gas utility tax, which his office estimates will take away around $164 million in state revenue. Quinn said the abolition of the tax on natural gas usage will give Illinois a competitive edge over its neighbors in attracting job-creators.
“Illinois will be the only state in the Midwest without a natural gas utility tax on manufacturers, retailers and everyday families,” Quinn said.
Quinn proposed a tax credit for families with children, which would provide $100 of tax relief annually for a family of four, the governor said.
“This targeted tax relief will stimulate consumer demand, which is 70 percent of our economy,” Quinn said. “And it will create jobs for our local merchants.”
Kelly Kraft, Quinn’s budget spokesman, said the tax credit would save taxpayers and cost the state $130 million annually.
Quinn also called for investing more in early childhood education, modernizing classrooms with digital textbooks and high-speed Internet access, and providing scholarships for college students.
“Our youngest and most vulnerable citizens need our strongest support,” Quinn said. “Research has shown that without an early learning foundation, children fall behind in school.”
The governor’s call for expanding the Monetary Award Program, which offers scholarships for college students demonstrating financial need, and more early childhood spending comes mere weeks after his own budget office projected keeping education spending flat for the next three years.
“I don’t know how that squares with what he himself said just a few weeks ago,” Radogno said.
The last pillar of Quinn’s jobs plan was upgrading the water systems statewide.
Quinn said his plan “will put thousands of people to work replacing broken water mains, building treatment plants, upgrading sewers and cleaning up environmental threats.”
Quinn didn’t outline how he would come up with the $500 million to cover his jobs plan, even as the state faces $8.5 billion in overdue bills, despite the individual income tax rate jumping by 67 percent and the corporate income tax rate jumping by 46 percent last January.
The governor’s only mention of funding was: “I look forward to working with you to find the proper funding to meet these urgent needs.”
Kraft said details will following in Quinn’s Feb. 22 budget address.
“Today, our focus is on the vision for our state,” Kraft said.
Cross said the state needs to tackle its ballooning Medicaid and pension spending before it looks to this jobs program.
“I’m not sure still to this day (if Quinn) gets the gravity of this situation,” Cross said. “He certainly hasn’t demonstrated (that) in what he did today.”