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Pritzker Budget Address

Gov. J.B. Pritzker is congratulated by lawmakers after delivering his first budget address to a joint session of the llinois House and Senate at the Illinois State Capitol in Springfield Wednesday, Feb. 20.

CHICAGO — The election of J.B. Pritzker as governor in November ushered in a sense of euphoria for Democrats after four years of Republican Bruce Rauner, resulting in an ambitious first-year legislative agenda.

But with the first spring session under Pritzker's watch nearing its scheduled adjournment at the end of May, many rank-and-file Democrats are concerned that the new administration's big ideas have largely remained just that, rather than passable legislation. Republicans also have noticed the Democratic discontent.

"I can't say what's going on in the second floor (governor's office), but there's a common theme among the rank-and-file members and people who work in the building, and that is how are we going to land this ship?" said House Republican leader Jim Durkin of Western Springs.

To be certain, Republicans were unlikely to go along with many of the Democratic governor's proposals, which include changing the state income tax system, legalizing marijuana, instituting sports betting and enacting a host of smaller-bore tax increases on such items as cigarettes, plastic bags and successful video-gaming businesses. There's also the need for a tax-supported public works plan, which GOP leaders support -- but not in its current form.

But it is the consternation among Democrats that is the chief challenge to Pritzker's agenda. Midterm dissatisfaction with Republican leadership at the state, congressional and national levels resulted in Democratic supermajorities in the Illinois House and Senate that were expected to easily carry the governor's agenda.

Yet the political lift this spring is proving to be a heavy one, and the outcome could set the tone for Pritzker's term.

At an unrelated news conference Wednesday in Springfield, the governor sounded confident when asked by longtime State Journal-Register reporter Bernard Schoenburg about the status of his agenda at this stage of May.

"Actually I feel quite good about our prospects for getting everything passed in this month. You know, ongoing conversations where there's some negotiation that needs to take place and I'm continuing -- my door is open to those folks who want to come in and talk about a particular provision. But, nah, I feel pretty good about where we are," Pritzker said.

He also, however, offered a caveat.

"You have more experience than I do what May should look like," the rookie governor told Schoenburg.

State Rep. Michael Zalewski, the Riverside Democrat who chairs the House Revenue Committee, a key panel on taxation, cautioned against concerns about the outcome of Pritzker's agenda.

"The governor proposed an ambitious legislative agenda at the outset of his administration and I think we're making progress on the core items," Zalewski said. "Probably, it's fair to say that some items are moving at a different pace than others."

The bills that have been filed so far are still only early iterations of the governor's proposals and remain far from ready to face a floor vote.

The governor's signature agenda item, a plan to put onto the 2020 November ballot a proposed state constitutional amendment to change Illinois from a flat income tax rate system to a graduated-rate system, is facing severe hurdles in the House. The plan cleared the Senate easily with all 40 Democrats voting for it. But it needs 71 House votes, and Democrats hold 74 seats. That leaves little room for defections, and at least two party members have expressed unease about voting for it without some concessions.

Trade-offs for votes have always been part of the legislative process. As it is tweaked, each bill represents its own game of Jenga — a piece pulled one way affects the other pieces, and threatens the bill's ability to succeed. But at this point in May, all of the issues and all of the bills become intertwined.

Take the prospect of a multibillion-dollar capital construction program for transportation and public buildings. Some Democrats said privately that Pritzker has been reaching out to new Democratic lawmakers who might be vulnerable to a 2020 general election challenge about what they need for their votes. But veteran rank-and-file lawmakers have not been consulted, they said.

As a result, the capital bill remains stalled in a chicken-and-egg debate. How big of a construction program is needed would determine how much it would cost and what taxes to raise. But without knowing the projects lawmakers want, the price tag and the new tax revenue needed remain unknown. A bill has been proposed for transportation projects, but there is already pushback over its call for a 25-cent-per-gallon gas tax increase and a $1,000-a-year tab for licensing all-electric vehicles.

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Other pieces of legislation also face major roadblocks, with just more than two weeks to go.

There's sports betting, which supporters had hoped to pass as a stand-alone issue, only to see it become tied to the inevitable discussion over expanded gambling involving casinos and horse tracks.

And there's legalized recreational marijuana legislation, mired in myriad concerns resulting from efforts to placate interests as varied as law enforcement and civil justice advocates.

Sports betting and legalized marijuana, along with a variety of tax increases, were part of a revenue package Pritzker proposed to serve as a bridge to a graduated-rate income tax.

But in a case of good news, bad news, a recent April surprise of $1.5 billion in new state tax revenue and the prospect of $800 million in additional money in the coming fiscal year has filled in some essential gaps. Pritzker has pledged to use the new money to fill a budget gap for the current budget year and devote it to underfunded state pensions next year. That alleviated a potential problem for lawmakers reluctant to adopt the governor's previously proposed reduction in payments into the debt-plagued public employee retirement systems.

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Yet at the same time, the cash infusion has prompted lawmakers to slow down any talk of the need for revenue, taking the heat off Pritzker's plea for additional sources of income.

The governor said it is wrongheaded for lawmakers to count on continued revenue surprises.

"We're glad to have the money in the month of April. We're glad to be able to help pay down the pension debt in our state. But the fact is it's unlikely to be something that continues for very much longer," Pritzker said Tuesday. "The predictions are, in fact, it will go back to a normalized revenue coming into the state. So those who have said, 'Oh, we got one windfall and that solves all our problems,' they're wrong."

With growing public discontent over skyrocketing property taxes, there is a push by some lawmakers to make greater real estate tax relief part of Pritzker's graduated-rate income tax plan.

During his campaign, Pritzker promised property tax relief through revenue from his graduated tax. But his initial proposal increased the current property tax credit on state income taxes by 20 percent -- essentially providing only $60 of increased relief on a $6,000 real estate tax bill. An add-on passed by the Senate would freeze school property taxes in 2020, but it is contingent on the state meeting increased state education funding provisions.

"Where's the property tax reform?" asked a veteran Democratic lawmaker, who like others in the party spoke on condition of anonymity to avoid a confrontation with the governor.

"Suburban- and urban-area voters are really getting hit hard," the lawmaker said, noting legislative gains Democrats made in suburban areas in 2018.

Leading Democrats agree that getting the graduated-rate income tax on the 2020 ballot is the top agenda item -- viewing it as a long-term key toward fiscal stability in a financially unstable state -- and know that trade-offs on other issues and projects are the likely key to make it happen.

But the fundamental issue lawmakers must deal with is putting together a state spending plan for the budget year that begins July 1 -- and doing it by the May 31 deadline. After the damage caused by the historic two-year budget impasse between Rauner and a Democrat-led General Assembly, the optics of a government in full Democratic control unable to meet is primary governmental obligation would be politically damaging.

There are bipartisan working groups in place, but despite Pritzker's vow of working across the aisle, House GOP leader Durkin said there have been only two meetings with the governor and the top legislative leaders -- the last held April 11.

Another veteran Democratic lawmaker said that while growing pains are to be expected in any new administration, Pritzker's has been especially slow off the mark.

"There's a lot of starting over and rebuilding and getting competent people who can do the job. I get that," the lawmaker said. "But while you're doing that, you need to run government and be inclusive, especially when you're attempting to pass such monumental items."

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