Illinois Governor Pat Quinn has announced that education funding will be cut by as much as $400 million next year. The money is instead being used to top up public worker pension funds after attempts to reign in pension costs went nowhere last year.
If Quinn sticks to this plan, that means that this will be the third year in a row that Illinois schools have had to do more with less. The cuts are not projected to be limited to education, and an across-the-board spending decrease is expected to be part of the budget proposal to be unveiled next week.
Among the handful of exceptions to this will be spending for healthcare for low-income and the poor and public safety.
“The explosive growth in the state pension payments means every other part of the budget has less money,” said Abdon Pallasch, Quinn’s budget spokesman. “The pain’s going to get worse and worse every year before we fix this pension problem.” The money pressure is intensifying at a fast clip. The standard annual pension costs are expected to rise from about $5.2 billion this year to $6.2 billion in the new budget that begins July 1, but the overall cost is even higher. The total pension drain could hit almost $7.9 billion — about one-fourth of the state’s operating budget. The higher figure includes $1.66 billion in repayments of loans taken out to cover annual pension costs in previous years.
The concern about ballooning pension payments crosses political lines, as Democrats embrace concern as much as the Republicans. Will Davis, a Democrat, said that something must be done to reign in the expense. Davis, who chairs the budget panel that oversees K-12 funding, says that to make up the shortfall in direct state aid, additional revenue sources from outside the state might be set aside for education expenses.
Davis has long taken an interest in pension reform and authored a proposal towards the closing days of the last legislative session that could have resulted in substantial savings. The proposal went nowhere because the negotiations over how the pension system might be fixed stalled.
Over the past two budgets, the state made cuts in education funding of $162 million and $209 million, Davis said. Quinn previously has asked for more in education funding than the Legislature has been willing to give in previous years. Quinn is scheduled to unveil his budget proposal in late February, but he has asked for more time. Also Tuesday, Quinn told reporters that gambling expansion is a “secondary issue to the most paramount issue we have to face, and that’s the whole pension reform.”