Budget Gimmicks Continue in FY 2024 Budget

By now, you may know that the General Assembly passed a Fiscal Year 2024 budget that sets a new record-high spending of $50.6 billion. While there were many good elements in the budget, I could not support it because it was filled with misplaced priorities that placed the interests of special interest groups ahead of those of everyday Illinois families. Following the adoption of the budget, I issued this statement:

“This budget is out of touch with the issues that are most important to everyday Illinoisans. We’re spending hundreds of millions on programs for non-citizens, while still coming up short in taking care of vulnerable Illinois citizens. Rather than spending over $100 million on welcome centers for undocumented immigrants and over a half billion for free health care for those in this country illegally, I would have liked that money channeled toward ensuring those who care for the developmentally disabled were earning a respectable wage and toward job incentives to create jobs and grow the state’s economy.

“The Democrats’ misplaced priorities were on full display these last few days as they bickered back and forth over the allocation of budget funds. Lost in the entire conversation were the ordinary Illinois families who pay the taxes that fund this budget. These folks are just trying to make a decent living, place their kids in good schools, and raise their families in safe neighborhoods.

“At the end of the day, this budget fails the people of Illinois. We had a real opportunity to produce a budget that addressed important issues, like crime, inflation, care for vulnerable citizens, and scholarships that lift up kids in failing schools. Instead, as always, the majority party pushed their own priorities and their own pet projects at the expense of Illinois families.”

Questions remain about whether the budget will truly be balanced at the year’s end. Hidden within the pages of the 3,500-page budget and its budget implementation document are several “low-balled” spending initiatives that could put the state’s spending well over expected revenues.

One example of possible “phantom” spending in this year’s budget, which also served as a major point of contention during negotiations, is a program solely funded by Illinois taxpayers that provides free healthcare to undocumented immigrants. Illinois is currently the only state in the nation to provide this level of healthcare to noncitizens ages 42 and older.

During budget hearings throughout the year, the Governor’s Administration provided a cost estimate of the program at a whopping $1.1 billion. Despite knowing this estimate, the Majority Party only allocated $550 million to the program in the budget—just half of what it is expected to cost taxpayers. While Democrats claim that they also provided the Governor with rule-making authority to rein in the ballooning program, it’s hard to believe that a rule change will be able to reduce the costs by half, especially after the Governor and the Majority Party have made it clear they would not be willing to cut existing enrollees from the program.

Another example of hidden spending is the anticipation of a new AFSCME contract, which the Governor is expected to agree to, at an additional cost of hundreds of millions of dollars. Funding for this new contract for thousands of state employees was conveniently left out of the budget.

With just a $100 million surplus in the legislatively approved FY 2024 budget plan, it is doubtful that the minimal surplus will be enough to cover the true costs of the state.

Senator Wilcox Supports Reinstatement of Blue Collar Jobs Act

In the days leading up to the approval of the FY 2024 budget, Senate Republican budget negotiators were able to work collaboratively to bring back an important package of tax incentives that create jobs and grow the Illinois economy. After being negotiated as part of the 2019 budget package and then frozen by Governor Pritzker prior to its implementation in 2021, Illinois’ Blue Collar Jobs Act (BCJA) has been reinstated and is now accepting applications.

The reinstatement of this Act is a definite step in the right direction for a state that has developed a reputation over time as being extremely business unfriendly. Rather than placing additional burdens on our job creators, we are finally putting businesses first, and providing them with incentives to build, stay, grow, and thrive in Illinois.

The Blue Collar Jobs Act program supports large-scale economic development activities by providing income tax credits to companies that make substantial capital investments in Illinois. The tax credits are based on the wages paid to construction workers employed on eligible projects and are based on the withholding tax paid to construction workers. The Act includes:

  • High Impact Business (HIB) Construction Jobs Credit: Equals 50% of the “incremental income tax” attributable to qualified construction jobs for a designated HIB taxpayer during the construction period with an investment of at least $12 million.
  • Enterprise Zone (EZ) Construction Jobs Credit: Equals 50% of the incremental income tax attributable to qualified construction jobs for approved capital investments of at least $10 million located in an EZ during the construction period.
  • River Edge (RE) Construction Jobs Credit: Equals 50% of the incremental income tax attributable to qualified construction jobs for approved rehabilitation plan of at least $ 1 million located in a RE during the construction period (applicable for tax years beginning on or after January 1, 2021).
  • New Construction Economic Development for a Growing Economy (EDGE) Credit: Discretionary credit for up to 50% of the incremental income tax attributable to qualified construction jobs during the construction period for approved capital investment projects over $10 million.

To be eligible, a company must be located in an Enterprise Zone or a River Edge Redevelopment Zone, designated as a High Impact Business, or have an agreement under the Economic Development for a Growing Economy Program. Each pre-requisite program has differing job creation and capital investment minimums/requirements.

I would encourage all entrepreneurs to look at Illinois when choosing where to take their capital investment. Helping middle class families by providing good jobs with decent wages is incredibly important, and the Blue Collar Jobs Act will go far in accomplishing that goal. Additional information about the program and a universal application can be found at https://dceo.illinois.gov/expandrelocate/incentives/bcja.html .

Audit Slams State’s Handling of COVID Relief Money

In 2020, the Governor announced the Business Interruption Grant (BIG) program. Operated by the Illinois Department of Commerce and Economic Opportunity (DCEO), the program used federal tax revenue to give $585 million in grants to businesses to provide relief from the COVID-19 pandemic. In a recent audit of the program, the Illinois Office of the Auditor General found that the spending “failed to work as advertised” and that the program itself had insufficient oversight.

One of the key failures of the program was the DCEO’s inability to provide documentation of the Round 1 selection process for recipients of the grants. This implication is worsened by another finding that multiple administrators did not comply with conflict-of-interest policies wherein they had a vested interest in which companies received grants. With the fairness of the awarded grants being called into question, additional findings—that $3.42 million was awarded to ineligible applicants and the program failed to verify with businesses their compliance to the program’s rules—show serious flaws with the execution of the program.

Alongside these findings, the Auditor General’s report made 15 recommendations to the DCEO for future grant programs, including directing them to develop and maintain proper documentation on how the program selects grant administrators, develops administrative rules, checks for the accuracy of applications, and complies with state statutes.

Illinois Wheat Production Sets Records

While some wheat producers across the United States have been feeling the effects of hot weather, the Illinois Wheat Association’s recent crop tour showed that Illinois wheat yields are breaking records. Accordingly, the average wheat yields were estimated by the Illinois Wheat Association at approximately 97 bushels per acre, significantly higher than Illinois’ 79 bushels per acre recorded from last year.

This increased return on wheat comes at an advantageous time, as a combined one million additional acres of wheat have been planted throughout the Midwest. Brought on by the disruption of global grain shipments due to the Ukraine invasion, the United States Department of Agriculture expanded insurance coverage for farmers raising two crops on the same land to attempt to boost production. As such, the number of total acres planted is up 41 percent from last year.

This jump might leave Illinois moving from the sixth-ranking wheat producer in the United States to the fourth. Currently, if predictions remain on track, Illinois stands to have the largest wheat crop since 2008.

Illinois Outdoor Hall of Fame Nominations Are Open

Since 2002, the Illinois Conservation Foundation (ICF) has hosted nominations and selections for the Illinois Outdoor Hall of Fame. These nominations include outdoor sportsmen and women, conservationists, or preservationists who have made significant contributions or exhibited dedication in preserving, promoting, enhancing, or supporting natural resources or outdoor recreational opportunities.

The number of inductees varies, but historically no more than five have been selected each year. After being selected, the honorees are invited to the annual Hall of Fame Gala.

Nominations are currently open and will close on July 14. All nomination applications are to be submitted by email in PDF form. Mail-in applications will not be accepted. More information on the application process can be found on ICF’s website.

Craig Wilcox

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