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Quinn to call for more cuts, scrutiny in budget

Published: Wednesday, March 6, 2013 10:15 a.m. CST

SPRINGFIELD (AP) — Gov. Pat Quinn is expected to call for additional cuts and more scrutiny of money that's automatically sent to local governments, public transportation and other programs when he presents his proposed budget Wednesday.

The Chicago Democrat's aides said the governor will propose cuts to the more than $2 billion in funds they describe as "on autopilot."

Those fund transfers — for programs ranging from tourism to horse breeding and violence prevention — are set in state statute. Quinn's staff wouldn't say Tuesday how much the governor will ask to cut from those areas, but attempting to change the amount the programs receive is likely to set up a contentious debate among lawmakers already at odds over the state's worst-in-the-nation pension problem.

Quinn is preparing to deliver a proposed state budget that calls for slashing $400 million in education, with the undertone of his planned speech to lawmakers being how their inaction in solving the state's pension crisis is straining all spending.

Quinn is struggling to find good news to deliver to lawmakers, noting that increased revenues will translate into an effort to pay down $2 billion in unpaid bills. His aides also said Tuesday that a tentative contract agreement between the state and its largest employee union will save the state $900 million in health care costs.

The governor has frequently said the first thing he and legislators must take on is the $96.7 billion deficit in the state's five pension systems. On Tuesday, new budget projections showed that trying to catch up with that hole will cost Illinois nearly $7 billion — or 19 percent of the state's general revenue fund. In education, for example, the pension obligation jumped from $4.1 billion in last year's budget to $5 billion, leaving $400 million less for education.

"We have a series of reductions that the governor does not want to do," Quinn's budget chief, Jerry Stermer, told reporters at a budget briefing late Tuesday. "These are outside his vision of where we ought to be. These reductions are a direct result of no action on pensions."

Quinn's administration released an outline of his $35.6 billion spending plan late Tuesday, though it didn't detail where other cuts would be made.

The spending plan already is at odds with legislators in the House, who approved a resolution Tuesday that states general fund spending shouldn't exceed $35.08 billion — about $500 million less than Quinn's proposal. That means House lawmakers are likely to cut even more.

Attempts at pension reform have repeatedly failed, despite hard deadlines from Quinn. Several proposals are currently on the table.

The entire budget totals $62.4 billion, though that includes federal grants and other money that is generally restricted to specific purposes other than day-to-day operations.

Stermer and other budget officials characterized the budget as taking the "corrective approach," meaning Quinn's administration said the budget called for paying down roughly $2 billion toward the state's backlog of bills, which currently tops more than $9 billion.

Stermer said that over the years, budget officials have resorted to "gimmickry," including not fully appropriating money for programs but not making a true cut, which contributed to the backlog.

The budget for the 2014 fiscal year calls for paying off the backlog of Medicaid and Department of Aging bills and nearly $200 million of overdue payments for the Department of Human Services by the end of the fiscal year.

The bottom line spending in several agencies remained flat, including economic development and public safety.

The full details of the proposed budget won't be available, however, until Quinn's address. And while his administration said the governor will not call for tax increases or fee hikes, they left open the possibility of closing tax loopholes.

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Associated Press Political Writer John O'Connor contributed to this report.

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