State: How long could the budget impasse last?

Christopher Z. Mooney is the director of the Institute of Government and Public Affairs at the University of Illinois and the W. Russell Arrington Professor of State Politics on the Springfield campus. Mooney studies comparative U.S. state politics, with a special focus on state legislatures. He spoke with U of I News Bureau business and law editor Phil Ciciora about the impasse that has left the state of Illinois without a budget since July 1.

The latest rumblings from Springfield indicate that this year’s budget won’t come until March or April. By that time, is it even worth agreeing to a budget?

mooney
Mooney

The budget is not just a single document. It’s a process that goes on throughout a three-year cycle, with the activities of different fiscal years happening simultaneously. In fact, I hope that the fiscal year 2017 budget is being developed right now for the governor to present to the Legislature in February. The development of a state budget, including the budgets of the various agencies that develop their own draft budgets and send them to the Office of Management and Budget, reflects the governor’s priorities and interests as well as the projected money the state has to spend in a given fiscal year.

For historical context, ever since 1215, on the fields of Runnymede, when the barons of England forced King John to sign the Magna Carta, the legislative branch has held the power of the purse in our Anglo-American tradition of government. Since July 1, we’ve had judicial decrees and executive actions forcing the expenditure of state funds – spending that has not been authorized by the General Assembly. In the end, I believe that the Legislature must approve this spending, even if it’s post hoc. Do they do that this month, next month, February, March or April? Do they do it at the same time they pass a fiscal 2017 budget, in May? I don’t know. All bets are off.

Somehow, the General Assembly has to authorize spending by the state that occurred during the period that we call fiscal year 2016. Sooner would be better than later. I can’t recall a state ever going this far into a fiscal year without a budget, at least in recent history. In Illinois, it’s certainly unprecedented.

Could you explain the mechanics behind why a budget is more likely to occur in the spring than it is now?

After Jan. 1, both the House and Senate only need a simple majority to pass legislation with an immediate effective date. In any given calendar year, after May 31, you can’t pass an “immediate” effective bill without a supermajority. This deadline is set in the state constitution to force legislative action on the budget before the fiscal year begins. Since fiscal years begin July 1, you can’t pass a budget in, say, mid-June with a simple majority and have it start a few weeks later. A bill can pass with an effective date of next Jan. 1 with a simple majority, but not one that would be effective sooner than that. So after Jan. 1, 2016, the Legislature could pass an immediate effective date bill with only a simple majority in each chamber. Thus, a budget will be easier to pass after Jan. 1 because the governor and legislative leaders will have to talk fewer lawmakers into agreeing to whatever deal they work up.

As it turns out, if they had known things were going to play out the way they have, the House and Senate could’ve passed a budget with a simple majority months ago and have it kick in in January. But then, obviously, they would have run the risk of the governor vetoing it, and then they would be back to square one. The gubernatorial veto power in Illinois is among the strongest in the nation. Even with supermajorities in the House and Senate, all the governor has to do is get the support of 40 percent plus one vote of one chamber’s membership to have a veto sustained.

At this point, I expect that the Legislature wouldn’t pass a budget that the governor isn’t going to sign. Sure, they could pass a budget and try to force the governor’s hand – a political tactic to put pressure on the governor. In effect, they could dare him to sign or veto the bill, hoping to achieve some political gain. That could happen, but I get the feeling that there’s less stomach for overt, large-scale political stunts as this impasse drags on. The public is not happy, and many people are being hurt without a budget.

The more likely scenario is that the legislative leaders will get together with the governor and work out a compromise that both sides can live with. None of the parties involved will be thrilled with the result – that’s the nature of compromise. In order to keep the budget from being a partisan issue that one party can beat the other over the head with in the next election, they’ve got to have both Democrats and Republicans voting in favor of it, so it can be said to be a bipartisan compromise. Once the budget is a bipartisan compromise, that somewhat inoculates it – and those voting in favor of it – against political attacks.

But make no mistake: This budget is going to be bad. There will likely be both painful cuts and significant tax increases. Every politician wants to spend money and cut taxes, because that’s what voters want. But, obviously, those two things are mutually exclusive. Nobody wants the pain of increased taxes or reduced spending. That’s the dilemma that state policymakers are faced with every year. We’re just having a more difficult time now than most years because the problems are so much worse than normal and the political dynamics are very different this year.

Are there any other possible tipping points that could compel both sides to cut a deal before the spring?

There are a few things that might lead to a serious crisis and shake loose this impasse. The Chicago Public Schools system could default or its teachers could go on strike or a mass layoff of teachers could happen. Credit downgrades could put the state’s debt on par with junk bonds. One or more universities or community colleges might not open in the spring. A prison may be unable to keep its lights on or feed its inmates.

Any of these would catch the public’s attention and put strong pressure on political leaders to settle the budget. Furthermore, you have to wonder how long vendors will continue to, essentially, float the state loans for bills that it hasn’t paid. Those vendors with deep pockets may do so since the state pays 12 percent interest on back bills, which is ridiculously high. But this doesn’t help if you’re a small day care provider or a women’s shelter and you don’t have the cash flow.

And then there’s the unforeseen, like bad winter weather or something else entirely. But I don’t know if even Mother Nature could trigger a compromise at this point. Then again, they could come up with a negotiated settlement tomorrow. We’re all waiting to see what will happen.

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