QuickView May 22, 2007
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QuickView – State Legislative UpdateApril 3, 2009
Wednesday,February22, 2012
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QuickView – State Legislative Update February 22, 2012
”Rendezvous” Budget
The Governor provided his budget address today, opening the speech by stating that this was a "rendezvous with reality". The speech included three prominent issues: pension reform, Medicaid reform, and fundamental tax reform.
Pension funding has been a huge issue for the state budget. The Illinois pension payment is expected to grow from $4.135 billion in 2012 to $5.249 billion in 2013. This represents an increase of$1.114 billion, or more than 26.9%. The Governor announced a state pension working group that will be tasked with coming up with solutions to solve the pension obligation problem. He said he wanted all potential solutions on the table and asked for those proposals by April 17th.
A second huge issue for the budget has been Medicaid spending. As has been reported recently, if Medicaid reform is not undertaken by the state, unpaid Medicaid bills could reach as high as $21 billion in future years. During his speech, the Governor announced cuts to Medicaid spending on the order of $2.7 billion. He also announced a working group to address ideas to reform Medicaid spending in Illinois. The Governor then announced to legislators that they shouldn't "plan on going home this Summer until this is done." A very bold statement in light of the fact that members of the General Assembly running for re-election want to get out in their new districts. Staying at the State House could generate heated pressure for getting something done or further show the strain between the Governor and the General Assembly.
A third focus for the Governor's speech dealt with tax loopholes. The Governor is proposing a complete review of tax loopholes included in current law in order to close those that are "unnecessary". He stated that rather than support the loophole lobby, these tax loopholes could be closed to provide revenue to pay past due bills and support targeted tax relief for working families. A list of “unnecessary loopholes” was not discussed, but the Illinois Farm Bureau will be diligent in working to see the agricultural sales tax and other tax incentives are not viewed as “unnecessary.”
Aside from these three issues, the Governor announced the closure or consolidation of 59 state facilities. Included in this list are prisons, developmental and mental health centers, Illinois State Police communication facilities, and repair garages. Agriculture did not avoid these potential closures. Among the list of facilities for possible closure is the Centralia Animal Disease Laboratory, which the Governor is proposing to consolidate with the laboratory in Galesburg. More details are below.
Two areas that avoided cuts are funding for veterans affairs and for education. The Governor proposed increased spending for education. Among the increases are $50 million in additional spending for Monetary Assistance Program (MAP) grants to students. The Governor had also announced proposed capital investments for education. Additional details on the proposed capital spending are included below.
This proposal from the Governor is the starting point. Leaders in both Chambers and both parties have stated that they look forward to working in a bipartisan manner to craft a balanced budget for the coming year. More details on specific items for agriculture are included below.
Agricultural Budget Line Items
Overall the Illinois Department of Agriculture (IDOA)sees a slight decrease in total budget compared to last year. The Department will receive a total of $94,118.0 million in total appropriations (vs. $94,768.9 million in the current budget and $96,566.9 million in FY 2011). The following is a detailed break down by fund type:
(In $ Millions) / FY 2011 Actual Appropriation / FY 2012 Enacted Expenditure / FY 2013 Recommended Appropriation / % Change FY12-FY13General Revenue Funds / $31,459.9 / $29,349.5 / $27,733.5 / -5.5%
Other State Funds / $49,319.5 / $51,343.7 / $52,717.5 / 2.7%
Federal Funds / $15,787.5 / $14,075.7 / $13,667.0 / -2.9%
Total / $96,566.9 / $94,768.9 / $94,118.0 / -0.7%
The following are major agricultural related budget line items and their proposed levels for the FY 2012 budget:
Line Item / FY 2011Actual / FY 2012Estimated / FY 2013Proposed
Cook County Extension / $2,749,200 / $2,749,200 / $2,449,200
State Cooperative Extension Service Trust Fund / $1,047,100 / $994,700 / $994,700
State Cooperative Extension Service Trust Fund - / $9,700,000 / $10,800,000 / $10,000,000
Ag Extension - 4-H / $736,700 / $786,400 / $786,400
SWCD / $3,355,000 / $2,785,000 / $2,485,000
AgriFIRST / $250,000 / $0 / $0
Co. Fair and Exposition Authorities / $900,900 / $900,900 / $900,900
Co. Fair Rehabilitation / $1,262,000 / $1,301,000 / $1,301,000
Co. Fair & Agriculture Societies / $1,774,300 / $1,798, 600 / $1,798,600
C-FAR / $0 / $0 / $0
Viticulture/Enologist / $142,500 / $142,500 / $0
Pesticide Act Administration / $4,324,800 / $5,100,000 / $5,800,000
Pesticide Enforcement Program / $603,700 / $600,000 / $625,000
Animal Disease Labs Act / $736,500 / $1,700,000 / $1,000,000
Livestock Management Facilities Act Administration / $15,000 / $30,000 / $30,000
Meat and Egg Inspection / $1,500 / $300,000 / $315,000
Agricultural Education / $1,947,600 / $1,800,000 / $1,800,000
Food Safety Modernization Initiative / ______/ $200,000 / $200,000
Dixon Springs Agricultural Center / $328,300 / $328,300 / $328,300
Proposed Closure of Centralia Animal Disease Laboratory
Included in the Governor's proposed budget was the proposed closure of the Centralia Animal Disease Laboratory with 15 employees. The administration is proposing to consolidate the Centralia facility with the lab located in Galesburg. This closing is estimated to reduce costs for IDOA by $1.1 million annually by reducing personnel costs, costs of contractual services, utilities and maintenance. It appears that the Department could see 12 layoffs as a result.
Grain Exports
In the budget book, IDOA listed its top priority for this fiscal year will continue to be increasing exports. The agency will look to build on Illinois' strong standing as an exporter of agricultural goods to increase exports by 40% in the next five years. IDOA plans to accomplish this goal through the focused use of tradeshows, governor's trips abroad, and focused contacts with grain and meat producers.
Department of Natural Resources
Among the agencies receiving a large budget reduction in the Governor's budget proposal was the Department of Natural Resources (DNR). DNR will see a total budget reduction of 13.5% for FY 2013. Not only does DNR see less GRF funding with a 9.4% reduction, but also a significant reduction of 27.1% in Federal funds.
Below is a breakdown of the funding for DNR:
(In $ Millions) / FY 2011 Actual Appropriation / FY 2012 Enacted Expenditure / FY 2013 Recommended Appropriation / % Change FY12-FY13General Revenue Funds / $61,494.5 / $50,011.0 / $45,310.0 / -9.4%
Other State Funds / $158,291.7 / $168,749.1 / $148,240.3 / -12.2%
Federal Funds / $69,205.6 / $32,393.2 / $23,530.5 / -27.1%
Total / $288,991.8 / $251,153.3 / $217,180.8 / -13.5%
The agency is also expecting a reduction in head count of 2.9%. However, there is an additional 15 conservation officers slated for hire for DNR.
Capital Budget Overview
Illinois Jobs Now!
The Illinois Jobs Now program is entering its final phase. As you may recall the Illinois Jobs Now program was signed into law in 2009 and was divided into three phases. The Governor is requesting the remaining $4.3 billion in bond authorization to complete the final phase of this program. If the $4.3 billion is not authorized then nearly $1.2 billion in new road and transit projects will not be able to start in fiscal year 2013, Illinois may have to return approximately $250 million in federal matching road funds, no new school construction projects can begin, broadband improvements that are currently underway won’t be finished, and universities that depend on maintenance money to keep their campuses safe and updated will be forced to move resources which will reduce funding for educating students. Initiating the final bond authorization requires a super majority vote in both chambers. This will generally take bi-partisan support, especially in the Illinois House.
21st Century Schools Initiative
The Governor is proposing a $1 billion program to change how schools provide education to students and also to help upgrade classrooms and laboratories. This money will be used to provide schools with the latest technology to improve classrooms and teach students the latest skills used in everyday life. The proposal also supports the consolidation of school facilities to promote more efficient operations. $120 million is proposed to go to State Universities meaning that each campus would each receive $10 million. This would be used to provide advanced technologies for university classrooms and laboratories. $144 million is proposed to 48 community colleges. $3 million will be granted to each of the state’s 48 community colleges to support instruction in science, technology, engineering, and mathematics learning areas and to promote the Pathways initiative, an innovative public private partnership between Illinois businesses and institutions of public education. Higher Education would receive $120 million in grants to assist in building STEM/Health science buildings and laboratories. Investment in research could increase federal research grants, increase patents and licenses, and technology innovations that could spur economic development. Pre-K through 12 is proposed to receive $616 million. $50 million would go towards early childhood construction grants will be awarded to programs that serve high need children and create classrooms. $566 million would be used to support innovative projects to upgrade technology in the classroom and create green and healthy school to encourage active learning and global connections.
Dam Safety and Floodplain
Currently thousands of homes and hundreds of thousands of agricultural acres are threatened by weakened levee systems and failing floodplain management structures. $100 million would go towards levee construction to protect 4.4 million acres of land. This 4.4 million acres of land has an economic output of $5.6 billion.
Questions
If you have any questions on the items listed in this edition of QuickView or on other state legislative matters please contact us. The State Legislative Team can be reached at (309) 557-2308 or by e-mail at .
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