(The Center Square) – A report showing total annual spending through Illinois state government nearly doubling in the past six years alarms a state senator.
A Commission on Government Forecasting and Accountability review of Illinois’ fiscal year 2024 budget shows since 2018’s plan, state spending increased 95% from around $99 billion in state and federal funds to $193.5 billion for this year’s plan.
Commission member, state Sen. Dave Syverson, R-Cherry Valley, said the increase is distressing.
“It’s growing at an alarming rate,” Syverson told The Center Square. “Certainly not something that is sustainable.”
Highway funds increased 123.5% in that time. Illinois doubled the state’s gas tax in 2019 allowing it to capture more federal funds.
Use of special state funds since fiscal 2019 increased from $36.1 billion to $70.1 billion, or up 94% in six years. Bond finance funds spiked in fiscal year 2021 at $29.6 billion, up 558% from 2018, but has receded to $25.4 billion for fiscal 2024. That’s still nearly $20 billion more than six years ago.
Debt service funds is about level where it was six years ago at around $4 billion.
Federal trust funds spiked in fiscal 2022 at $31.7 billion. That is a 286.5% increase from fiscal 2018’s levels of $8.2 billion. Since fiscal 2022, federal trust funds have decreased to $22.3 billion. Despite that decrease, the state’s general fund spending is up 36% since fiscal 2018, increasing each year over the past six years.
Syverson said that’s unsustainable, but Illinois continues to spend.
“The amount we’re spending on health care, especially undocumented, it’s very difficult to reduce that,” Syverson said.
The state budgeted $550 million to subsidize the health care of migrants over the age of 65. There are no federal matching funds for that program.
“When you see how much is going to education and pensions, hard to reduce that,” Syverson said.
The state continues to increase K-12 funding by $350 million in general revenue funds each year. Pensions cost the state one of every five tax dollars the state takes in.
COGFA’s monthly report for July 2023 shows the month “ended with GDP results indicating the economy had accelerated in the second quarter. While all of this was happening, inflation continued to slow. Overall, the threat of a recession in the near term appears to be abating with continued slow growth expected in the second half of the year.”
Despite that, Syverson worried slow growth may not last with continued inflation, higher taxes and interest rates.
“Families have less disposable income and so we’re gonna see a slowing of the economy and as a state, we’re not really prepared for that,” Syverson said.
To brace for a slowdown, Syverson said the state needs to reduce taxes and make a more friendly business climate.
“But if we keep increasing spending at record levels as we did this year, we are facing significant cliffs that are going to be very difficult to deal with,” Syverson said. “You can only do that by growing your way out. You can’t tax your way into prosperity.”