Governor Pritzker Releases Five-Year Forecast Showing Projected Long-term Budgetary Deficits Nearly

Governor Pritzker Releases Five-Year Forecast Showing Projected Long-term Budgetary Deficits Nearly

SPRINGFIELD -- The Governor’s Office of Management and
Budget (GOMB) released the annual Illinois Economic and Fiscal
Policy Report showing under Governor Pritzker’s leadership Illinois
is in its best fiscal shape in decades.

“Illinois’ bills are being paid on time, we have over $1 billion
in our rainy-day fund, our credit ratings are up and we are honoring
our commitments to long-term financial liabilities by contributing
extra to Illinois’ pension systems,” said Governor JB Pritzker. “As
we celebrate the tremendous progress we’ve made with our partners
in the General Assembly, we remain committed to working tirelessly
for Illinois taxpayers and responsibly managing the state’s finances.
We’ve closed a seemingly insurmountable structural deficit that
I inherited, and together we are securing Illinois’ long term fiscal
stability and providing economic opportunities to its citizens.”

The future years’ budget outlook detailed in the report benefits
from strong fiscal management over recent years as the Governor
worked with partners in the General Assembly, the Comptroller and
the Treasurer, to balance state budgets, tackle the state’s multi-billion-
dollar bill backlog, repay COVID related short-term borrowings
early, make $500 million in extra-ordinary payments to the state’s
pension systems and put more than $1 billion in a savings account
for fiscal emergencies or economic downturns. Additionally, by rebuilding
the foundation of the state’s finances during the Pritzker administration,
the Governor and lawmakers were able to provide $1.8
billion in tax relief this year to the hardworking people of Illinois.

Even with troubling national economic indicators, income and
sales tax collections so far this fiscal year continue to exceed budget
forecasts by significant margins. Coupled with other one-time
revenues, the General Funds revenue forecast for fiscal year 2023
is revised upward by $3.69 billion. GOMB is continuing to monitor
the revenues closely as inflation and national/international factors
beyond the state’s control may impact the economy in uncertain
ways. GOMB is now projecting a nearly $1.7 billion net surplus in
the general funds budget for fiscal year 2023, wiping out a forecasted
fiscal year 2023 shortfall of nearly $3 billion as estimated in
2019.

The Governor intends to pursue several actions to continue
Illinois’ strong path forward, and put the state in the best possible
fiscal position to prepare for the economic uncertainty that lies
ahead. The Governor’s recommended actions include working with
the Legislature to:

Make additional deposits of $1.3 billion into the state’s
rainy-day fund, bringing it to more than $2.3 billion. While Illinois
currently has its highest balance ever at $1.045 billion, Illinois is still
among the smallest state rainy-day funds.

Set aside funds to pay off revenue bonds issued in 2010 to
help the state pay bills that mounted during the Great Recession.
About one-third of the $1.5 billion borrowed at the time
remains outstanding.

Make an additional contribution toward the Unemployment
Insurance Trust fund. The Trust Fund’s remaining debt
to the federal government is $1.345 billion plus interest. The
Governor and the General Assembly have already taken several
steps to reduce the amounts owed from last year’s level of $4.5
billion.

Illinois’ significant improvement to its fiscal outlook has
been noticed by the state’s credit rating agencies, which have
upgraded Illinois’ General Obligation Bond credit ratings a
total of six times during the past year.

GOMB is required to annually submit an Economic and
Fiscal Policy Report to the General Assembly outlining the
long-term economic and fiscal policy objectives of the state,
along with the economic and fiscal policy intentions for the
upcoming fiscal year and for the subsequent four fiscal years.

The reports are available to the public online and can be
found here: https://budget.illinois.gov/policy-reports.html.

Latest Stories

Latest Podcast

STARR Community Services International, Inc.