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Illinois budget leaves state agencies in limbo

Published: Thursday, June 5, 2014 5:04 p.m. CST

SPRINGFIELD (AP) — Illinois state agencies are restricting spending and bracing for the worst after lawmakers approved a budget that uses accounting gimmicks and punts on crucial decisions about where to find revenue until after the November election.

The $35.7 billion spending plan for the fiscal year beginning July 1 keeps most funding flat after Democrats — who hold supermajorities in both chambers — couldn't find enough votes to extend the state's temporary income tax increase before adjourning for the session last week.

That option's still on the table after the November election, when lawmakers will face heightened pressure to find additional funds in the next year or cut at least $4.4 billion in expenses, forcing layoffs, facility closures and massive program cuts.

But for now, agencies are preparing to adopt a so-called "maintenance plan" under a budget which doesn't allocate enough money to cover expenses, uses special funds for day-to-day operations and banks on future increases in revenue that may not materialize. The uncertainty of receiving more tax dollars means, for example, the state has funds to repurpose a shuttered correctional facility, but not to staff it. Several state historic sites could close, at least temporarily.

"I think right now, we can't assume that (funding) will occur because by the time we'd be able to react if it didn't, it would be too late. We'd have to plan under the assumption it won't," said David Jensen, president of Lutheran Services — the state's largest provider of services ranging from foster care to patients with chronic mental illness. The move, he said, puts both quality of care and the number of patients served at risk.

Gov. Pat Quinn_who has called the budget "incomplete"_said this week that he will "work to minimize the impact of cuts in vital services and continue to cut waste and maintain our hard-won fiscal gains."

But as the legislation makes its way to the governor's desk, where it awaits the Chicago Democrat's signature or the use of his veto pen to amend portions of it within 60 days, state agencies, schools and social service providers are operating in a state of limbo.

Funding for the state's historic sites would be cut by about 20 percent under the budget plan— but what exactly that means for the Lincoln Log Cabin, the Dana-Thomas House or the Old State Capitol is anyone's guess.

"There's been no decision yet on how to proceed —whether to close sites, which sites to close — anything like that," said Chris Wills, spokesman for the Illinois Historic Preservation Agency.

"It could be that decisions are made very early in the process or it could be that we go forward for a while and see how bills are coming in, see what the costs are and make decisions as circumstances permit."

Social service agencies fear that the budget could prompt further delays in payment in promised state funds, forcing businesses and charity groups to borrow money, cut jobs and services and take on personal debt.

Illinois' backlog of unpaid bills was about $4.7 billion last month, according to the comptroller's office. That's down from nearly $10 billion in 2010. But Moody's Investor Service said Tuesday that the unstable budget could offset some of those gains.

"The prospect of further delays in payments really jeopardizes the viability of the service providers," Jensen said. After years of cuts, he said, "there are no obvious places to eliminate or reduce costs."

The Illinois Association of School Administrators decried the lack of certainty of state revenue coming in as "irresponsible from a fiscal standpoint" and one that would "result in significant harm to our districts."

"We cannot plan for the next school year with the crippling uncertainty that is left if we receive an appropriation that is not supported by proper revenue," the letter, signed by 120 superintendents around the state, read.

Plans to repurpose two closed youth correctional centers also are up in the air.

Abdon Pallasch, Quinn's assistant budget director, said the state is "right on track" to convert the Joliet youth center into a mental health facility for inmates as part of a court settlement. However, the budget doesn't have money to staff the facility.

Another proposal to repurpose the Murphysboro youth center into a prison for drunken driving offenders will also likely be put on hold.

"We're going to continue to pursue it. Does the current budget situation make that as smooth as before? No, but again this is an incomplete budget," said Tom Shaer, spokesman for the Department of Corrections, adding that there aren't plans to close a facility or lay off employees.

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