The Illinois economy, weakened by the national recession and the terrorist attacks of September 11, shows no signs of rebounding fast enough to prevent serious cutbacks in state spending during 2002. In the month since I proposed a balanced state budget for the coming fiscal year, the revenue deficit faced by the state government grew by $350 million to about $1 billion.
The budget problem in Illinois was not caused by overspending. More than 40 other states have had to cut their budgets since September 11 because tax collections aren’t meeting original revenue estimates. The recession has had a devastating effect on governmental budgets throughout the country.
Over the past six months, I initiated several cost-cutting measures designed to balance the budget without the need for massive layoffs of state employees. However, the state’s budget remains out of balance in part because other proposals to reduce spending were met with strident resistance from the American Federation of State, County and Municipal Employees.
Involuntary layoffs of thousands of AFSCME members could be avoided if the union leadership would listen to rank-and-file members and negotiate reasonable changes in the current contract. AFSCME leaders in Iowa negotiated a temporary wage freeze earlier this year that prevented 800 permanent layoffs.
To help balance the upcoming budget for Fiscal Year 2003, I’m willing to forego any salary increase allocated for me this year. I’m willing to order no salary increase for my staff. I’m also willing to order my cabinet—if their pay is set by state law—to refuse any salary increase this year. I call on other state officials to follow my lead.
Legally, I’m bound to budget money for pay raises to state employees covered by collective bargaining agreements. I’m bound by the Illinois Constitution to budget pay raises for state officials whose salaries are set by state law. But to pay for AFSCME raises, which I can’t unilaterally cancel, layoff notices for state employees were issued in March by various agencies.
Layoffs are the final option in balancing the budget. Unfortunately, all other options have been exhausted. I don’t have the unilateral authority to raise taxes, as AFSCME asked. I don’t have the authority to spend state bond money on government operations or to transfer money from one government account to another.
A few months ago I ordered a one-day unpaid furlough for all state employees under my control to save $8 million. I’ve taken my furlough day, and by the end of the fiscal year, every member of my cabinet and staff will have taken a furlough day. Many legislators and state employees not under my control have also taken a furlough day.
However, AFSCME not only opposed the concept of one-day furloughs, it went to court for a temporary restraining order to stop the furloughs for 45,000 of their members. That action negated any significant cost savings from the furlough plan. I have no choice but to find those savings from additional permanent layoffs.
In an attempt to save about $20 million, I proposed the state turn over food operations in all state prisons to private contractors. Private companies have operated food services in some of the state’s maximum-security prisons for about 20 years. But again, AFSCME went to court and stopped this proposal, wiping out $20 million in cost savings. I’ll probably have to find that $20 million by closing or downsizing additional prisons.
There are less than 80 days left before the start of the new fiscal year. It’s my hope in that time the General Assembly and I can count on the support of state employees and other interested stakeholders in fashioning a balanced budget that fulfills the needs of Illinois citizens in every part of our great state. IBI