Rauner’s proposed budget cuts take away from Illinois’ future

Most Illinois residents know that the state is billions of dollars in debt and has fallen behind on funding its pension obligations. Gov. Bruce Rauner has proposed severe cuts to the fiscal year 2016 (FY16) budget to remedy this situation. However, the Governor’s proposals have focused on cutting the budgets of Illinois human services, including services for affordable housing, homeless youth, and supportive housing. These cuts hurt the state’s most vulnerable citizens by taking vital resources away from those that need them the most.

Gov. Rauner’s FY16 budget cut proposals include:
  • $3.1 million cut to homeless youth services
  • $1 million cut to homeless prevention funding
  • $14.1 million cut to supportive housing services
These cuts come after funding has already been rolled back in a budget fix for the remainder of the 2015 fiscal year (ending June 30, 2015). The fix included 2.25 percent across the board cuts as well as a variety of transfers or fund “sweeps” from different dedicated revenue funds, including a $6 million sweep of the Illinois Affordable Housing Trust Fund, which is the state’s main resource to create and preserve affordable housing. 
 
Many of our partners, including Housing Action Illinois and the Chicago Coalition for the Homeless, have responded to the Governor’s budget proposal by encouraging Illinois residents to contact their state legislators and urge them to raise revenue instead of relying solely on budget cuts. Housing Action Illinois writes, “Governor Rauner has increasingly called for ‘shared sacrifice’ as of late, but his budget only calls for sacrifices from the most vulnerable among us.” Housing Action Illinois promotes accessible and affordable housing for Illinois residents and has principal partner for several initiatives to create affordable housing options and prevent homelessness.  
 
Woodstock Institute, along with many of our partner organizations, is a member of the Responsible Budget Coalition (RBC), which also analyzed the Governor’s proposed budget cuts and their long-term impact. The RBC’s report shows that, overall, Gov. Rauner’s proposal will cut over $1.3 billion in investments to strengthen our workforce and local communities. Cuts in funding for these programs could lead to higher tuition at local colleges, for example, which will make it harder for people to attend college. The Governor’s proposal will also cut over $180 million in services and programs that support stable and supportive housing, cutting services to over 10,000 homeless households and 955 at-risk households in need of supportive housing services, and denying access to shelters and other services to 1,300 homeless youths.
 
Cuts in to vital human service programs, including housing services and homelessness prevention, will harm already struggling communities and groups. Housing insecurity limits a community’s ability to grow; people cannot help build their communities when they are worried about whether they can make this month’s rent, or whether they will have a roof over their heads. 
 
Gov. Rauner’s budget’s includes a reduction in Illinois income tax, but Housing Action Illinois found that the state’s wealthiest residents would be the main beneficiaries of this reduction. This, combined with Gov. Rauner’s other proposed cuts, illustrates a budget that is more interested in helping residents who are already wealthy as opposed to helping low- and moderate-income residents create their own wealth and thus remain self-sufficient. 
 
The primary reason for the revenue shortfall is the failure of the legislature to maintain the 2014 income tax rates. Beginning January 1, 2015, Illinois’ flat income tax rate dropped from 5 percent to 3.75 percent, reducing revenue to the state by $6 billion a year. The RBC urges the Illinois legislature, and Gov. Rauner, to raise additional revenue and avoid devastating cuts that will cripple service providers across the state. A variety of revenue options are available, including retroactively reversing the income tax cut, expanding sales tax to include services, and closing corporate tax loopholes. With just six weeks left in the spring legislative session, we urge Illinois policymakers to pass a responsible budget that sustains important services for Illinois residents and communities.