Civic Federation Releases Plan to Balance State Budget
In March 2014, the Civic Federation released its Fiscal Year (FY) 2015 budget roadmap for Illinois, which would eliminate the State's $5.4 billion backlog of unpaid bills, balance its budget, and reduce tax rates over the next five years. The roadmap proposes several measures currently under debate in the Illinois General Assembly, including:
- An extension of the temporary income tax rate increase for one additional year (currently set to partially sunset this year).
- Gradual reduction of both the Individual Income Tax (IIT) rate from 5 percent to 4 percent and the Corporate Income Tax (CIT) rate from 7 percent to 5.4 percent.
- Expansion of the IIT base to include taxation of retirement income.
- Creation of a "rainy day fund," equivalent to five percent of General Fund revenues, for future fiscal instabilities.
- Establishment of controls on agency spending to put toward a $5.4 billion backlog of unpaid bills.
GO TO 2040 emphasizes the importance of coordinated investments to support the region's communities, infrastructure, and economy. The State's ability to make these investments will be increasingly affected by structural fiscal issues. CMAP will be monitoring fiscal reform proposals as they are addressed in the General Assembly this year.