(The Center Square) – Some Illinois statewide officers are sounding the alarm about potential budget cuts amid the COVID-19 pandemic if the federal government doesn't provide additional money to states, but a public finance watchdog said it’s an opportune time for reforms to shore up spending in the state.
Comptroller Susana Mendoza warned of “rough waters ahead” and “fiscal landmines” because of the economic impacts from the pandemic and the government's response to it substantially reducing tax revenues.
“I’m not going to sugar-coat it: I believe big challenges lie ahead for the State of Illinois,” Mendoza said. “Without question, Illinois … will need financial support from the federal government. This is not aid for historic problems we were on a path to solving – but for these new holes COVID-19 has blown into our budget.”
Gov. J.B. Pritzker painted a dire picture Monday when asked about the state’s finances.
“There certainly will be significant cuts that will have to be made to life safety, to education, to so many things that I care really deeply about,” Pritzker said. “But this is going to be up to Congress. They're the ones who have the ability to help us.”
Wirepoints President Ted Dabrowski said the state had problems long before COVID-19 and now is an opportune time to get reforms in places to shore up how the state spends the taxpayers’ money.
“This is a big chance for him to actually be the guy that fixed Illinois, he’d be the first guy to actually solve Illinois’ problems,” Dabrowski said. “Right now we don’t hear any of that at all.”
Pritzker said without federal aid there will have to be service cuts. He also said that will hurt private vendors “because the money isn’t flowing – because we don’t have the ability to balance the budget in the way that we had intended to.”
Dabrowski said local governments are also going to be impacted, but there’s not a lot they’ll be able to shore up without action from the statehouse.
“Pensions, mandated by the state. Prevailing wages, mandated by the state. Collective bargaining laws, mandated by the state,” Dabrowski said. “So there’s not as much that can be done by local governments except to fire people which makes things worse for those communities.”
Dabrowski said the last thing the state needs is a tax increase on small businesses from a progressive income tax.
The governor enacted a Democrat-backed budget that relies on $5 billion in federal aid that hasn’t materialized.