Budget report predicts bleak future for Illinois' finances
WSIL -- The bi-partisan budget championed by both Republicans and Democrats as balanced earlier this year, has a structural deficit of more than $500 million, according to a new report from the Governor's Office of Management and Budget.
That deficit could go up to more than $1 billion if Governor Bruce Rauner loses a court case over step increases for state employees.
But the report projects even tougher times ahead for Illinois, with deficits skyrocketing in the coming years.
Much of the projected deficits come from an expected recession where economic growth in Illinois slows to 2.4 percent in 2019 before contracting in 2021.
Combined with continued growth in government spending... the report estimates a deficit of of about $2.7 billion in 2020, going up to more than $3 billion from 2021 through 2024.
Education spending is expected to jump from just over $10 billion this year to more than $12 billion in 2024.
Over the same period, pension spending is projected to rise by nearly $2.5 billion.
With the predicted deficits of more than $16 billion over the next five years, the report projects the state's bill backlog will explode, more than tripling from $7.8 billion to nearly $24 billion.
Now, the report does not account for potential revenues generated by the possible legalization of recreational marijuana, which a study by the Illinois Economic Policy Institute says could raise more than $500 million in additional funds.
Governor-elect J.B. Pritzker says he supports legalizing marijuana in the state.
Even if those revenues were added, the report warns that "barring meaningful economic and political structural changes", Illinois' economic growth will continue to under perform the nation.
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