(gentle music) (upbeat music) - Thanks for joining us for this special edition of CapitolView.

I'm Fred Martino.

On Thursday, WSIU presented Illinois Governor, JB Pritzker's, State of the State and Budget Address.

In a little more than 52 minutes, the governor addressed a wide range of issues and parts of his proposed fiscal plan.

Today, reaction from the senate republican leader.

I am very pleased to welcome Senator John Curran.

Senator, thank you so much for being with us today.

- Very nice to be with you.

- Good to have you here.

Senator, I wanna start with the budget.

As you know, projected deficits run as high as $900 million.

The governor's plan extends a limit on operational losses that corporations can write off on their income taxes.

A $100,000 cap was slated to expire at the end of the year.

It would be extended three years, but would increase the cap to $500,000.

That is the largest part of the governor's proposal for new revenue.

The governor's office estimate reported by the Chicago Sun-Times is more than $500 million in revenue from that idea.

Your thoughts on that proposal?

- Fred, to back it up a little bit, so when the pandemic first started and revenues crashed and we were in a state of emergency, the governor, one of his proposals was to decouple that from the federal regulation and impose that cap.

There was no cap prior to the COVID-19 pandemic on that operating losses, because the idea of that is to smooth out business operations for our Illinois businesses, and certainly as well as startup costs.

Okay, we all understood the pandemic.

While we didn't support it, that was the governor's stated purpose.

Revenues have ballooned in the meantime with all the influx of federal dollars.

We had a proposal last year to eliminate that cap one year early.

The governor has refused to let go of that revenue he is raising from this, and now we see now that the pandemic is behind us and we are at a record budget, a record amount of revenue in spend.

We are up $12.6 billion from the governor's first budget.

He is still refusing to let that cap expire and get us back coupled with the federal net operating loss exemption, which is detrimental to our businesses here in Illinois, who by the way, also suffered through the pandemic.

So we are in complete opposition to this.

This is a big step backwards.

I realize he's raising that cap, but understand that these businesses have been sitting on these losses since the pandemic because of the $100,000 cap put in place.

They have planned for that to come off the books this year.

It is hard to run a business in Illinois when you get these knee jerk reactions from the executive branch, from Governor Pritzker, because he can't control the spending side.

- Okay, well, I wanna ask you about another part of the governor's proposal.

The Chicago Sun-Times says that the governor's office estimates about $200 million in revenue from another idea.

This is more than doubling the state tax on sports betting revenue collected by sports books from 15% to 35%.

Your thoughts on this?

- You know, this is an emerging market in Illinois.

Sports gaming is new to Illinois.

This is a significant increase in a new developing market.

When we imposed a higher tax increase on, what do you call it?

The video gaming that occurs in bars and restaurants, it was a much more built out, established structure and we gave them offsets to smooth it out.

So this is an instance where we really have a partner in the space raising revenue for the state of Illinois, and now we're gonna really imperil their ability to operate going forward.

So, I think this is another one where the legislature's gonna take a very close look and make sure that we're not really impairing this area of gaming before it's even had an opportunity to really take hold in the state of Illinois.

- Okay, well, republicans have been vocal in opposing additional spending on relief programs for immigrants, many of whom were sent to Illinois by Texas Governor Greg Abbott.

Governor Pritzker has proposed nearly $182 million in additional relief money in this next budget.

Your thoughts on that?

- The governor is looking to raise revenues, tax increases, increases on families.

the standard exemption.

Lowering the standard exemption is by far the most objectionable, and he is doing that to pay for his non-citizen welfare state that he has created.

We are spending about a billion dollars in this budget on the non-citizen welfare programs, which includes this $182 million you've highlighted.

And at the same time, lo and behold, the budget's about a billion dollars outta whack and he's gotta go raise a billion dollars in revenue with more tax increases on Illinois families and businesses.

So, we were hoping to hear the governor course correct in his presentation yesterday, roll back the non-citizen welfare programs that he has put in place over six years that are causing a financial crisis throughout the state, and especially in and around the city of Chicago.

Unfortunately, the governor's doubling down on that approach.

- Okay, in his speech, the governor criticized republicans in Congress who refused to support a bipartisan deal to address the border crisis.

Where do you stand on that?

Was it a mistake to reject even voting on that legislation to reduce the number of immigrants that are coming into the country, which continue to cost Illinois, New York, Denver, I mean, many, many places around the country?

- Look, the one thing our governor is an expert at is pointing the finger elsewhere.

So we are laser focused on Illinois.

The federal government needs to figure this out.

You know, the president and Congress, they need to get together and lead on this, and they gotta get it figured out on their end, but we need to have our attention to focus here on Illinois.

When the governor turned into that part of his speech and really just a lot of partisan rhetoric, that really does the people of the state a disservice.

There was nothing unifying in that speech, in that second half of his speech that the whole citizenry of this state could rally around.

So I think it was a real missed opportunity by Governor Pritzker.

The finger pointing, whether it's the Mayor of Chicago, whether it's Congressional republicans, whether it's the governor of Texas, it is getting tiresome.

It is time for this governor to step up and actually show some leadership.

- The governor said that it is not acceptable for Illinois to fail to provide food and shelter for immigrants.

He said that it is not what, quote, decent Midwesterners do, and not what, quote, leaders do.

How do you respond to that?

- We are a true outlier, not only in the Midwest, but mostly throughout the country.

So, what other state is spending a billion dollars?

No one else in the Midwest is burdening their taxpayers with a billion dollars of additional costs because they're insisting on making that state the most welcoming state in the nation as they try to get out on the national platform and run for another office.

You gotta concentrate on the office you've been elected and the state you've been elected to lead, and asking our taxpayers to shoulder that burden at a billion dollars a year is not fair.

And we're gonna continue to oppose that.

This is not about people wanting to come to Illinois.

I am the son of immigrants.

My parents immigrated from Ireland.

I understand why people wanna come to this country.

This is the greatest country in the history of this planet.

And so I get why they wanna come here.

This is about the fairness to our taxpayers and the burden this governor is asking them to shoulder with his non-citizen welfare programs.

That's what's gotta end.

- I wanna ask you about another thing that is actually not connected to this influx of more immigrants, because it's a continuing program that has cost hundreds and hundreds of millions of dollars.

The governor's next budget also includes more than $600 million to continue providing healthcare benefits to undocumented people 42 and older who would otherwise qualify for Medicaid.

I know many Republicans have spoken out against this program.

What are your thoughts about it?

- This is another area where, you know, this is a misplaced priority by the governor.

This is part of that non-citizen welfare program that he has put in place.

Last year, the budget appropriated $550 million for this.

The governor claimed he couldn't control costs without emergency authority.

The legislature gave him emergency rulemaking authority.

We voted to give him that emergency rulemaking authority to give him the ability to manage this.

I don't think he needed it.

He could have put rules in place through the normal process, but he still failed to act.

He still failed to put copays in place, and costs still exploded well beyond the $550 million.

This is a misplaced priority.

He is asking Illinois taxpayers to shoulder this burden.

That is not fair.

They're already paying for their own healthcare, and this healthcare that they're paying for, you know, the copays are minimal to nothing at this point.

There were no copays last year.

It is fee for service while the ordinary citizen out there has to get prior approval before they go to a specialist, go to seek a procedure or treatment.

That is not this program.

It is just walk in, get what you want, the governor has shown no ability to manage it, and that cost, what he's proposing in this year's budget, I'm really skeptical that he could even manage the program at that cost.

We have got to be fair to the taxpayers of Illinois.

That is too much.

We should not be asking them to shoulder that burden.

- Yeah, as you noted, some copays have been added, but Capitol News Illinois reporting that still the cost exceeding the budgeted amount for that program, and again, now there's an increase for the upcoming year that's being proposed of more than $600 million for that continuing program.

Well, while there is a lot of disagreement about that issue and others, the governor may get some republican support for another plan; he says that he wants to eliminate the 1% sales tax on groceries.

Do you support that idea?

- We do.

I mean, this is about helping families with, food costs has never been higher, it's at a 30-year high, just the cost of living, property taxes.

Families are overburdened, struggling to make ends meet.

It is kind of, I think, a little disingenuous to hit them with an income tax increase to save the state, to raise revenue for the state.

And then the local governments are gonna shoulder the complete burden on the grocery tax.

We absolutely support the rollback of the grocery tax receipts, or grocery tax.

We wanna make sure that we work with local municipalities on that, that we're not creating other holes or problems.

But at the same time, we need to course-correct here, there should be no income tax increase on families all across Illinois.

- And that's what the governor's proposed.

- Yeah, and just to give our audience some context on this, it is a rather rare thing to have a sales tax on groceries, even in some states that are considered higher-tax states like Pennsylvania, the sales tax in Pennsylvania, as an example, does not include a grocery tax.

In fact, in Pennsylvania, it does not even include tax on clothing, because those are both considered necessities.

So this is an interesting development, but as you point out, there is some controversy among some municipalities who are wondering, "Well, how do we make up that loss in revenue if that goes away?"

So, we'll see.

Do you think that it will pass?

Do you think the elimination of the 1% grocery tax will pass in the general assembly?

- I do, and I'm hopeful that we turn towards, a senator in my caucus, Senator DeWitte, has been very vocal on this and has had a proposal filed for a while that actually backfills locals through the local government distributed fund to make sure we're not creating holes at the local level, but absolutely repealing that tax.

I do expect it to pass.

It's just the details are gonna be what, if anything, we backfill with the locals.

- All right, the governor has also proposed what he called a $12 million tax credit for low and middle income families with children under three years old.

Tell me your thoughts on that idea.

- You know, we support families.

Families are struggling.

This is an opportunity, especially for low-income families, to provide some assistance.

This is birth through three.

I think it's an opportunity to even maybe expand this more.

And at the same time, I think the federal is coming back on, too.

So this could be an opportunity to really couple with the federal child tax credit and provide some real relief to low-income parents that are taking on a huge, joyful burden with a new child.

So I think that's going to receive broad bipartisan support.

- Okay.

The governor spent a good amount of time during his speech talking about an idea that will undoubtedly be popular with some voters.

He said that Illinois needs additional regulation to ensure that health insurance companies do not deny care that doctors want their patients to receive.

Your reaction to this?

- You know, I think there is general consensus and support for that notion.

I think we're going to have to see the details.

This was not a part of his budget plan that he shared ahead of time with any of the caucuses.

So when we actually see the bill filed in terms of the details, but we certainly, we want to knock down the barriers to Illinois citizens or residents getting access to the healthcare that they need.

So in concept, it sounds like something that's going to receive a lot of support.

It's just, something like that is complicated, and details are gonna matter.

- Okay, we'll look for those details.

We're interested as well here, and I'm sure a lot of voters are interested, what are the details?

The governor also said that he wants to eliminate the sale of stripped-down health insurance in Illinois.

As the governor noted, those are sometimes called, quote, "Junk insurance."

He said that 12 other states have already eliminated the sale of these plans.

Do you think Illinois should be number 13?

- You know, this is again gonna be details.

How are you going to, I mean, there's no definition in state statute on stripped-down junk insurance, right?

So like, you know, we don't know exactly what he's talking about.

That's a speech.

It sounds fine in the speech.

Now the governor needs to actually step up with actual details in front of the legislature, work with the legislature on a proposal like that.

So, that's what the months ahead are gonna be.

- All right.

The governor also talked about using $10 million in state funds to, he says, "Eliminate $1 billion in medical debt."

He noted a nonprofit is doing this, paying to resolve medical debt at pennies on the dollar.

Your thoughts about this idea?

- This was a pilot project.

So I represented a portion of Cook County.

This was a pilot program that Cook County government started about a year and a half ago.

They've enjoyed success with it in terms of eliminating, this is really debt that will never be, I mean, these are debts that will never be recovered, right?

So they're on the secondary market, they've probably been sold two to six times, and it is an opportunity to buy it for a penny on the dollar, but what you're doing is you're clearing someone's credit history, usually lower income, it's designed for lower income people clearing their credit history.

It gives them a better opportunity at renting an apartment, purchasing a car, getting a loan, things like that, really knocking down their barriers, some of the burdens due to their economic status that oftentimes can hinder them.

So it's a good proposal.

I think it's a small investment that can reap larger gain for that segment among us, and we need to be looking at things like that.

But I really wanna applaud Cook, I mean, Cook County was the one that I think started this, and when you see something working somewhere, there's nothing wrong with trying to emulate it.

So that's good.

- All right.

Interesting.

We have talked a lot about what the governor has proposed.

What are republicans proposing that he did not?

What do you want to highlight?

- We are looking, look, republicans are looking to provide long-term relief for working families here.

So, in the areas of property taxes and income taxes, we want to make sure that we are assisting our proposal on, which sounds like the governor's on board as well now, on the grocery tax.

I mean, we want to provide relief for working families.

At the same time, we are pursuing legislative initiatives on public safety.

We certainly, especially more up my way, we have significant public safety concerns and issues.

We have really impaired the whole prosecutorial and police process the past half-decade and that's something that we're looking to turn around.

So, we have a lot on the agenda.

Obviously, we're in the superminority.

So a lot of what we do also is really try to highlight some of the more bad ideas that are coming from the majority why they're not right for the citizens (speaking faintly).

- Well, you highlighted a really important issue there.

One area of continuous discussion in Illinois, as you know, involves the state's property taxes, which are among the very highest in the country.

What should be done about that, and what do you think should be proposed, if anything?

Because we're talking about huge differences between lower tax states, and some would argue this is a reason why there's an impediment to people staying in Illinois and moving here.

- Really, property taxes and the estate tax are really the two biggest impediments to keeping residents here in Illinois, or moving to Illinois.

You know, we see a lot of end of life with the estate tax.

People start thinking about, you know, what's gonna happen after they die.

And they tend to move to states that don't have an estate tax.

We have an onerous one here.

Property taxes are the same thing.

A lot of times, especially our seniors, they end up getting taxed out of their homes.

So one of the proposals we have on property taxes, we have to lift the low-income property tax freeze, the cap on that has not kept, there's been no CPI applied to it.

We've seen a large CPI spike with Social Security that has not, so it has not really kept up and people are going to be losing their cap due to the increase in Social Security because their household income is gonna bump above the cap, no fault of their own.

And they're going to be socked with a significant property tax increase.

So Senator Erica Harris has a proposal on that in our caucus that we're going to be pushing really hard behind, and we have a more comprehensive property tax proposal to try to provide relief to all property taxpayers throughout the state.

So a little more comprehensive.

I know the democrats, the majority, the school funding formula was designed to really build up the state's investment in K through 12 education with the goal of not only funding education, but also removing their reliance from the property tax bill to try to bring down property taxes this way.

But we know when we have a proposal that we can actually do more.

While that is that is going on, we don't wanna wait for that to actually bear fruit on the property tax bill.

We have a proposal we're pushing.

- So I have just about two minutes left, senator.

Anything that you want to add as you reflect upon what will undoubtedly be a very challenging time in the general assembly to look at all of the increasing costs that are facing the state, and then proposals for even more increases in certain areas?

- You know, we're getting into the budget process now.

The start is the, and it's certainly the most important thing we do year in and year out.

The start is with the governor's proposal.

Last year, the senate democrats and the senate republicans really engaged in a good bipartisan process in doing deep dives throughout the entire state budget to try to find better ways, more efficient ways, cost-cutting measures.

And we're looking to do that same process this year.

While it didn't ultimately land with a bipartisan budget, sometimes with supermajorities, they don't really need us to pass a budget.

This year is more challenging.

So with that challenge, I'm excited, because I think it gives us an opportunity.

Maybe they need us a little more this year.

And so I'm hopeful we're going to really have a great effect, bring our priorities of the parts of the state we represent to this budget process and hopefully land a bipartisan budget that really reflects the balanced policy for all of Illinois.

- Senator John Curran, the senate republican leader.

Senator, thank you so much for being here.

- Very nice to be with you.

Thank you.

- Good to have you.

Thank you for being with us at home.

For everyone at WSIU, I'm Fred Martino.

Have a great night.

(upbeat music) (upbeat music continues) (upbeat music continues) (upbeat music continues) (upbeat music continues)