{"id":37945,"date":"2026-05-13T16:35:12","date_gmt":"2026-05-13T21:35:12","guid":{"rendered":"https:\/\/www.thexradio.com\/news\/?p=37945"},"modified":"2026-05-13T16:35:12","modified_gmt":"2026-05-13T21:35:12","slug":"illinois-budget-picture-tightens-in-final-stretch-amid-economic-uncertainty","status":"publish","type":"post","link":"https:\/\/www.thexradio.com\/news\/local-news\/37945-illinois-budget-picture-tightens-in-final-stretch-amid-economic-uncertainty\/","title":{"rendered":"Illinois&#8217; Budget Picture Tightens in Final Stretch Amid Economic Uncertainty"},"content":{"rendered":"<div class=\"pdfprnt-buttons pdfprnt-buttons-post pdfprnt-top-right\"><a href=\"javascript: window.print()\" class=\"pdfprnt-button pdfprnt-button-print\" target=\"_self\" ><img decoding=\"async\" src=\"https:\/\/www.thexradio.com\/news\/wp-content\/plugins\/pdf-print\/images\/print.png\" alt=\"image_print\" title=\"Print Content\" \/><span class=\"pdfprnt-button-title pdfprnt-button-print-title\">Print<\/span><\/a><\/div><p><em><span style=\"font-weight: 400;\">SIMS: Senate Revenue Committee Chair Elgie Sims, D-Chicago, listens to a budget update from Department of Revenue Director David Harris on Wednesday, May 13, 2026. (Capitol News Illinois photo by Jerry Nowicki)<\/span><\/em><\/p>\n<p><i><span style=\"font-weight: 400;\">Deputy governor warns state has limited ability to increase spending<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">By BEN SZALINSKI<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Capitol News Illinois<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><a href=\"mailto:bszalinski@capitolnewsillinois.com\"><span style=\"font-weight: 400;\">bszalinski@capitolnewsillinois.com<\/span><\/a><\/p>\n<p><b>Article Summary<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Illinois\u2019 new budget offices lowered revenue projections for the upcoming fiscal year on Wednesday, citing growing economic uncertainty.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The news comes as lawmakers are looking to finalize the fiscal year 2027 budget with less than three weeks left in the legislative session.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Deputy Gov. Andy Manar warned the revisions show the state has little room for new spending beyond what Gov. JB Pritzker proposed in February.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Rising unemployment could limit growth in personal income taxes while rising prices are making consumers more cautious, which could lead to lower sales tax collections.\u00a0<\/span><\/li>\n<\/ul>\n<p><i><span style=\"font-weight: 400;\">This summary was written by the reporters and editors who worked on this story.\u00a0<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">SPRINGFIELD \u2014 Growing pessimism over the direction of the global economy is leading budget analysts for the governor\u2019s office and Illinois\u2019 legislature to temper revenue expectations less than three weeks before lawmakers are set to finalize a new budget.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Both the governor\u2019s budget office and the General Assembly\u2019s Commission on Government Forecasting and Accountability revised revenue projections for the current year and fiscal year 2027 down by less than 1%. While the change is small and generally keeps budget talks on track, it\u2019s a sign that confidence in the economy is waning.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Deputy Gov. Andy Manar, who leads budgeting for Gov. JB Pritzker, said in a statement \u201cthe revised revenue estimates show that the overall fiscal picture in Illinois has substantially remained the same since February, heading into the final weeks of this legislative session.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But he said it also \u201cunderscores the state\u2019s need to remain focused on fiscal discipline as the entire country is forced to continue to grapple with economic and geopolitical uncertainty that the Trump Administration is creating.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The forecasters revised estimates downward after S&amp;P Global\u2019s April economic forecast came in less optimistic than the January report that was used to craft Pritzker\u2019s budget. GDP is now expected to grow 2.1% in 2026 compared to 2.3% that was forecast in January.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Citing the ongoing war in Iran, S&amp;P increased the likelihood of its downside scenario, which would include higher energy prices and declining consumer demand.\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It all leaves Manar with a warning for lawmakers, including many Democrats who have sought spending increases.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThe latest estimates shows that our ability to increase spending beyond the Governor\u2019s introduced levels is limited,\u201d he said.\u00a0<\/span><\/p>\n<p><b>Estimate reductions<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Pritzker\u2019s budget office decreased its FY27 revenue projection by $173 million to $55.9 billion. The change leaves projected revenue $149 million short of the spending Pritzker proposed \u2014 provided lawmakers approve the measures Pritzker proposed in February to bring $728 million in new revenue. That includes a tax on social media companies based on how many users they have in Illinois. The other funds would come from adjustments to caps on operating loss deductions and table and electronic gambling games.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The reduction is a small amount in the context of the massive state budget but underscores how little flexibility lawmakers have in crafting a budget to take effect July 1.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">COGFA revised its FY27 projection down by $190 million to $55.3 billion. That doesn\u2019t include Pritzker\u2019s proposed revenues, meaning COGFA\u2019s estimate is actually about $180 million more optimistic than the governor\u2019s office.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">COGFA notes that sales tax collections have slowed in recent months in the state, causing them to lower expectations by $67 million for the upcoming year. A state law passed last year to plug holes in public transit agencies\u2019 budgets also requires that the state appropriate more sales tax revenue from motor fuel sales to public transportation, reducing the total amount of sales tax revenue available for General Fund spending.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;I\u2019m hearing from the retail industry, in fact just in the past quarter, sales are down \u2013 prices remain high, but actual volumes are down,\u201d Sen. Mark Walker, D-Arlington Heights, said. \u201cI looked at everyone\u2019s forecast for next year\u2019s sales tax \u2013 I still think they\u2019re optimistic and so I would be concerned.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Year-over-year <\/span><a href=\"https:\/\/www.politico.com\/news\/2026\/05\/12\/inflation-iran-energy-gas-trump-economy-00915857\"><span style=\"font-weight: 400;\">inflation rose to 3.8%<\/span><\/a><span style=\"font-weight: 400;\"> in April, according to the U.S. Department of Labor, which is the highest rate in three years. COGFA Revenue Manager Eric Noggle acknowledged there is a lot of uncertainty surrounding sales tax revenue as prices rise and consumers adapt.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;As prices rise, as inflation goes up, you\u2019re going to bring in more sales tax revenue,\u201d he said. \u201cBut if there\u2019s fewer products being purchased, that\u2019s going to start to offset.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">COGFA is monitoring changes to employment levels that could impact how much the state receives from personal income taxes. Unemployment has been on the <\/span><a href=\"https:\/\/capitolnewsillinois.com\/news\/unemployment-rising-throughout-illinois\/\"><span style=\"font-weight: 400;\">rise<\/span><\/a><span style=\"font-weight: 400;\"> in Illinois, hitting 5.1% in March, according to the Department of Employment Security. S&amp;P\u2019s April forecast expects unemployment will peak in early 2027, rather than in early 2026 as was expected when Pritzker introduced his budget.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;It\u2019s not what you really want to see when you\u2019re thinking about personal income tax growth,\u201d Noggle said. \u201cThe saving grace that we\u2019ve seen though is wages have been up.\u201d\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Amnesty tax revenue the state used to balance the FY26 budget is also not expected to continue in FY27, Department of Revenue Director David Harris told a Senate committee on Wednesday. He said that brought in about $250 million to the general revenue fund this year.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Lower expectations for transfers to the General Fund caused the largest decrease in COGFA\u2019s expectations for the upcoming budget, in large part because the state expects to pay more in income tax refunds. Federal funding is also projected to decrease.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But with interest rates no longer expected to decrease soon, COGFA expects other revenue sources will collectively perform $133 million better than previously expected thanks to more revenue from interest. Sen. Rachel Ventura, D-Joliet, also met the news cautiously.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;Since it\u2019s our job to have a sustainable budget moving forward, when I see a bunch of shifting, weakening numbers, and only one holding up the fort, I don\u2019t like to put all my eggs in one basket,\u201d Ventura said.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The impact of high gas prices remains a wild card.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;There\u2019s a lot of uncertainty and we can\u2019t pretend otherwise; we\u2019re just going to have to take it day by day,\u201d Department of Revenue Chief Economist Rubina Hafeez said.\u00a0<\/span><\/p>\n<p><b>Alignment on current year expectations<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Revenue has outperformed expectations in the current fiscal year. The budget lawmakers approved last year was expected to bring in $55.1 billion in new revenue, but the governor\u2019s office now estimates that will land at $55.7 billion with COGFA even more bullish at $55.9 billion.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Most of that has been driven by better-than-expected personal income tax revenue, which is up 4.2% through April so far in FY26.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But even though sales tax receipts have been up 4% so far this year, COGFA sees signs of that slowing. The source has increased by only 2.1% since January and the commission now expects the state will receive $64 million less than expected in its March forecast. The governor\u2019s office made a similar revision.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Lawmakers are expected to pass a budget on May 31.\u00a0<\/span><\/p>\n<p><a href=\"https:\/\/capitolnewsillinois.com\/\"><i><span style=\"font-weight: 400;\">Capitol News Illinois<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.<\/span><\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>SIMS: Senate Revenue Committee Chair Elgie Sims, D-Chicago, listens to a budget update from Department of Revenue Director David Harris on Wednesday, May 13, 2026. (Capitol News Illinois photo by [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":37947,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[19],"tags":[],"class_list":["post-37945","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-local-news"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Illinois&#039; Budget Picture Tightens in Final Stretch Amid Economic Uncertainty - Effingham&#039;s News and Sports Leader, 979XFM and KJ Country 102.3<\/title>\n<meta name=\"description\" content=\"Effingham&#039;s News and Sports Leader\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.thexradio.com\/news\/local-news\/37945-illinois-budget-picture-tightens-in-final-stretch-amid-economic-uncertainty\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Illinois&#039; 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