House leaders trying to build support for new budget plan

SPRINGFIELD, Ill. -- Leaders in the Illinois House floated a new plan for balancing the state budget Thursday after encountering opposition to the earlier idea of letting the governor decide where to cut spending.

The new plan, if approved, would erase the state's $1.35 billion deficit and put a balanced budget on the governor's desk, said House Minority Leader Lee Daniels, R-Elmhurst.

Daniels and House Speaker Michael Madigan, D-Chicago, met with Gov. George Ryan to explain the plan. They then planned to discuss it with Senate leaders.

"Mr. Madigan and I have agreed upon a balanced approach, and I think the governor is receptive," Daniels said.

He offered only a few hints at how the plan would work.

Casinos plan a role

It would include some version of a tax on riverboat casinos, he said, but throw out the idea of letting some casinos expand. It also would cut state personnel expenses by $50 million through an early retirement program.

Daniels said it also calls for giving up some of the state's future revenue from a national tobacco lawsuit in exchange for an immediate lump sum. The idea has been rejected as unworkable by key officials, including the governor.

The new plan would drop the governor's idea of raising taxes on real estate sales and creating a tax "amnesty" during which people could pay back taxes without facing punishment, Daniels said.

Madigan would say little except that he did not expect legislative action Thursday night.

That would postpone all major budget action to the day of a key legislative deadline. If an agreement is not reached today, it could become much harder to pass a budget.

A key labor union spent much of the day lobbying against the plan Madigan announced Wednesday -- passing an overloaded budget and letting Ryan decide which programs to cut.

"This is supposed to be a democracy. ... I don't think we want to be in an autocratic state in which one person is making these kinds of decisions," said Roberta Lynch, deputy director of the American Federation of State, County and Municipal Employees.

The lobbying seemed to work. House Republicans had agreed to support the plan but reversed themselves and opposed it Thursday.

The governor and legislative leaders have spent weeks fruitlessly negotiating over how to close a $1.35 billion deficit in the $53 billion budget for the coming year.

Ryan has proposed deep spending reductions, including cutting 6,500 state jobs and scrimping on social services, along with raising taxes on cigarettes, casinos and selling real estate. But some lawmakers strongly oppose the cuts and others reject the tax increases.

The stalemate led to the plan for lawmakers to restore money to the budget -- Daniels said $387 million -- and send it to the governor. They would be able to tell the public that their budget would keep a prison open, protect Medicaid from cuts and reduce the number of state layoffs.

Threatened with veto

Ryan would then use his veto powers to trim excess spending and, presumably, restore the budget to the level he proposed in an extraordinary Memorial Day speech to the Legislature.

If lawmakers do not approve a budget by midnight today, it becomes tougher to pass anything at all. Rather than a simple majority, it would take a three-fifths vote. Finding that much support could take a long time and require added spending to placate lawmakers, some officials warn.