Politics
Pritzker’s Proposed $55.2 Billion Budget Includes No New Taxes, Some Cuts in Care for Non-Citizens
With searing warnings that America is approaching tyranny under President Donald Trump and that Illinois families could suffer if Trump delivers on massive funding cuts, Gov. J.B. Pritzker on Wednesday made his pitch for a $55.2 billion state budget that protects core spending in areas like education, while shaving a controversial program that gives health care coverage to non-citizens.
“I believe strongly that we must continue our firm commitment to building up the rainy day fund, new funding for our public schools, investing in economic growth and jobs, and improving much needed services to working families and to the most vulnerable,” Pritzker said before a joint session of the Illinois House and Senate. “These are things we cannot compromise on, particularly when we face the uncertainty of the federal government’s haphazard ‘ready, fire, aim’ tactics toward everyday Americans. There are no magic bean fixes. And each year there’s some difficulty that requires us to work hard to overcome it. This year the surfacing difficulty is Donald Trump’s and Elon Musk’s plan to steal Illinois’ tax dollars and deny our citizens the protection and services they need.”
The spending plan, however, doesn’t contemplate how Illinois would handle massive blows to the budget, such as if Trump follows through with talk of reducing Medicaid, a joint federal and state health care program available to low-income individuals.
At reporters’ questioning, Pritzker said the unknowns are too copious. He encouraged residents to reach out to their congressperson.
“We don’t know what they’re going to do,” Pritzker said. “It’s very hard to build something into our budget to try to determine what the real impacts are.”
Comptroller Susana Mendoza, a Democrat, praised him for doing the “right thing by introducing a balanced budget” that shows restraint.
“Even in a best-case scenarios we’re in trouble here, because I find it hard to believe that we will not see reductions to federal funds once the new Congress comes in, passes their budget that the president will, in fact, sign, which my guess is, is going to have significant cuts to federal funds going to states like Illinois or across the nation,” Mendoza said.
Maurice Scholten, head of the Taxpayer Federation of Illinois, issued a statement giving appreciation to Pritzker for making good on Illinois’ commitments without a broad tax increase and said improvements to the state’s fiscal health are deserving of accolades.
Still, Scholten said, the plan presented by Pritzker does not attack problems at the root, like “longstanding structural deficits that compound over time and cause the fiscal cliffs we stand near the edge of today. We encourage state budgeteers to continue making decisions that may be politically difficult but allow Illinois to realize long-term economic growth, responsible tax structures, and efficient government services.”
The Democratic governor’s task was made easier than had been expected since a November report that projected a $3.2 billion deficit.
A top aide to the governor said the outlook has changed since that projection, which was based on global data from S&P, such that Illinois is estimated to bring in $1.5 billion more in revenue during the next fiscal year.
Still, the aide said, the growth of 2.9% including a 1.9% group of “core” revenue sources of individual and business income taxes, sales taxes and public utility taxes reflects “steady growth, but lower than what the state has seen earlier in this decade.”
The revision allowed Pritzker to escape drastic wholesale cuts. Instead, he presented a budget that spends $55.2 billion from general funds of the expected $55.4 billion in revenues, leaving a surplus of $218 million, with the bulk dedicated to the state’s rainy day fund.
“I’m proud to say this year’s budget proposal is balanced and responsible. It represents some hard sacrifices and moderated spending,” Pritzker said, warning lawmakers that he would be unwilling to accede to their expected demands to back favored programs with more robust spending. “I stand ready to work with members of the General Assembly to deliberate and negotiate the final budget. But let’s be clear, I will only sign a balanced budget. If you come to the table looking to spend more — I’m going to ask you where you want to cut. I have made difficult decisions — including to programs I have championed, which is hard for me, just as I know some of the difficult decisions you will have to make will be hard for you.”
Members of his party immediately called for additional spending — be it on schools; Latino lawmakers calling for the reversal of proposed cuts to programs that support immigrant communities; or the Black caucus seeking specific economic development funding for underserved neighborhoods.
Still, there were no blockbuster new programs that could prove costly for Illinois.
Pritzker, instead, made splashes by announcing he wants to require schools to ban cell phones during class time; wants to allow community colleges to offer four-year degrees in high-need professions like nursing, early childhood and advanced manufacturing; and will continue to use state levers to rein in health care spending, like by blocking insurance companies from denying mental health care and restricting pharmacy benefit managers that he said drive up prescription drug prices.
“The days of unchecked health insurance greed are coming to an end here in Illinois,” Pritzker said. “Predatory practices are being dismantled one by one, and we’re going to lower the cost of health care for working families.”
Given the fiscal constraints, one Democrat described it as an appropriately “boring" budget.
But Republican state Sen. Chris Balkema of Channahon called it a “whopper of a budget … the largest budget the state has ever seen.”
Republicans were similarly outraged last spring, when Democrats, who control Illinois government, passed the current $53.2 billion budget, though Pritzker is set to call for that to be supplemented by another $550 million.
“You can’t believe any of these facts or figures that are coming out of the governor’s office,” GOP state Sen. Chapin Rose of Mahomet said Tuesday, questioning the “miraculous” “crazy swing” that gave Pritzker such cushion.
Pritzker proposes bringing in roughly half a billion dollars more into the state’s coffers by offering amnesty to delinquent taxpayers, increasing taxes on casino table games — though Chicago is the sole casino exempt — and eliminating a deduction available to legal marijuana businesses.
Illinois is also next year supposed to begin putting not just some, but all of the 6.25% sales tax charged on motor fuel into the road fund, which pays for infrastructure projects. Pritzker is pitching holding on to the $171 million so it can be spent on more general needs.
Marc Poulos, director of the Indiana, Illinois, Iowa Foundation for Fair Contracting, said labor unions are open to discussing the budget with Pritzker but that balancing the budget shouldn’t be on the backs of working people who build roads and bridges.
While Pritzker has been steadfast in saying he’ll stand up for supporting immigrants as President Donald Trump prioritizes widescale deportation, Pritzker also is proposing to eliminate medical coverage for non-citizen adults aged 42-65. His plan continues to provide cover for older non-citizens through the Health Benefits for Immigrant Seniors program.
“We’re absolutely committed to continuing to fight and hold a line for the program,” state Sen. Karina Villa (D-West Chicago) said. “Now we have a few months here to work hard, and like we said, look line item by line item to see where we’re going to be able to make things up … we believe that health care is a human right, and we believe that taking people off of health care is not the right answer.”
Pritzker also wants to knock down spending on immigrant welcoming centers by nearly $100 million, down to $40 million.
“I express my profound disappointment in the insufficient proposed investments and programs that support our community,” state Sen. Javier Cervantes (D-Chicago) said. “The lack of substantial funding for initiatives designated to empower our Latino population threatens to undermine one of our most vulnerable groups at the time, at the greatest time of need.”
State Sen. Elgie Sims, who negotiates the budget on behalf of Senate Democrats, said those demands will be worked out as lawmakers can now get to spending through May, using Pritzker’s plan as a jumping-off point from which they’ll pass their own plan.
“I often say in our caucus that we’ve got infinite needs and finite resources, and that’s what the next couple of months will be about,” Sims said. “How we balance those infinite needs with the finite resources we’ve got.”
Pritzker’s package makes Illinois’ legally required $10.6 billion payment to the state’s pension funds, taking up nearly 20% of the general funds budget.
An additional $78 million would be spent on pensions, through enhancements for so-called Tier 2 workers whose retirement benefits are less than those hired before 2011, as Pritzker seeks to prevent a potential “safe harbor” legal problem that could be triggered if the benefits are found to be less than Social Security would provide.
A Pritzker official said that’s the cost that would bring the Tier 2 pensions into compliance, but that would fall far short of the sweeping pension sweeteners that labor unions representing teachers, university employees and state workers are pushing for, which the state’s non-partisan Commission on Government Forecasting and Accountability projected would cost more than $1.1 billion the first year in effect.
The Illinois Education Association, which represents educators outside of Chicago, said meeting the safe harbor benchmark alone would help only top earners, while additional pension sweeteners, like lowering the retirement age and offering bigger annual bumps in benefits, would help Illinois with its need to recruit teachers.
“A fix to Tier Two that allows all those who serve students in Illinois an equitable retirement and that entices people to stay in the profession is what’s needed,” IEA president Al Llorens said in a statement. “IEA looks forward to working on a solution.”
If the governor gets his way, another half a billion dollars would be spent to make properties — including unused state land — “site ready” for businesses, a move that Pritzker aides said could reap $4.7 billion in private investments.
Pritzker’s plan does not address helping the Chicago region deal with a $770 million annual drop-off in transit funding.
State Rep. Kam Buckner (D-Chicago) said he was not worried that means Illinois is abandoning public transit needs, rather that it shows what he had always assumed: that lawmakers first have to hash out issues like governance of the transit system and a revenue source.
“Those of us who are working on this issue, we’ve got to go back to the drawing board,” Buckner said. “It seems to be standalone or not attached to this current set of numbers.”
Pritzker also told reporters that Illinois will benefit from a stronger transit system, but that it’s unknown how much the state will have to invest because there are other factors at play, like how much of the gap may be covered by fare increases.
The governor will continue his pattern of buttressing education spending, including by putting another $350 million into the “evidence-based” formula that prioritizes the neediest K-12 schools — significantly less than the $1 billion increase Chicago Public Schools and the Chicago Teachers Union have publicly shamed the state for withholding.
Ahead of the speech, CPS CEO Pedro Martinez said he was at the Capitol on Wednesday to ensure the district gets its fair share.
“I want to see what other opportunities there are to add a little bit more revenue, especially in education,” Martinez said.
That Illinois continues to spend more on education shouldn’t be taken for granted.
“It’s not true in every state in the country,” Martinez said. “I’ve been in other states. At the same time, we need to acknowledge that the needs are growing so fast across our state. More students with IEPs (Individualized Education Programs), more students with English as a second language.”
Heading off the early criticism from Republicans, a Pritzker budget summary notes that 75% of the Fiscal Year 2026 proposed increases in spending will go toward increased spending on schools, pensions and “medical expenditures,” including health care for low-income children and adults as well as state employee and retiree insurance.
“If not for these 3 areas, spending would increase less than 1%,” the budget document reads.
Pritzker on Wednesday also plans to partially address a third rail in Illinois politics: an abundance of units of local government. He wants to do so by making it easier for townships to consolidate and eliminating the office of township assessor in counties with fewer than 5,000 residents.
He’ll also join states that have banned students from using personal cell phones during classroom hours, and he wants the legislature to act to give additional protections to those seeking or performing abortions in Illinois.
Contact Amanda Vinicky: @AmandaVinicky | [email protected]
