State general revenues top $50 billion for first time in FY 2022
By JERRY NOWICKI
Capitol News Illinois
jnowicki@capitolnewsillinois.com
SPRINGFIELD – State tax revenues grew by $5.5 billion in the fiscal year that concluded on June 30, exceeding $50 billion for the first time in Illinois’ history, according to a new report from a state budgeting agency.
The 12 percent base revenue growth in Fiscal Year 2022 gave lawmakers near-unprecedented flexibility in the current budget year.
That allowed the General Assembly to approve $1.8 billion in tax relief, pay $500 million more to state pensions than statutes require, retire hundreds of millions of dollars in interest-accruing debts early, and drive the state’s “rainy day” fund to its highest-ever balance of over $1 billion.
It also helped the state reach a zero-day accounts payable cycle – meaning it was caught up on its bills – for the first time in decades.
But the report from the Commission on Government Forecasting and Accountability also noted that the pandemic-related drivers of growth, which led to nationwide revenue windfalls for nearly all state governments, are likely to wane in the coming months.
That’s something Gov. JB Pritzker told Capitol News Illinois last week that lawmakers planned for in April when they projected Fiscal Year 2023 revenues at $46.5 billion – an 8 percent decrease from the final FY 2022 numbers.
“We wrote that into the budget, that is a decrease in revenue just in this coming year,” Pritzker said in an interview. “So, we understand that there were some temporary nature of revenues that were coming in.”
All told, the FY 2022 base revenues reached $50.3 billion without including direct federal aid. The number jumps to $51.1 billion when including a $736 million direct transfer-in of COVID-19 relief dollars.
The base revenues were nearly $8 billion beyond the May 2021 projections on which the FY 2022 budget was based. Personal and corporate income tax grew $6.1 billion beyond what was projected in May 2021, while sales tax revenues were about $979 million beyond projections.
While the revenue windfalls won’t alleviate longstanding budget pressures such as a $130 billion unfunded pension liability that demands about a quarter of state general revenue funds each year, it’s a level of good financial news that Illinoisans are not accustomed to hearing – and a level of progress Pritzker has hung his hat on as he seeks a second term.
“A significant surplus and a zero-day payment cycle mean that our schools are funded, our roads are being rebuilt, and our healthcare providers are paid on time – and Illinois taxpayers are no longer dealing with hundreds of millions of dollars in interest payments because government didn’t do its job,” Pritzker said in a statement last week. “Illinois’ massive bill backlog – eliminated since I came into office – once contained bills past due for as long as 500 days.”
The COGFA report noted that even though direct federal aid was not included in the base revenue calculation, the indirect effects of federal stimulus played a major role in the unexpected growth.
So major, in fact, that revenue came in beyond initial projections in 49 states in the fiscal year.
One driving factor, according to the report, was the “continuation of a pandemic-related shift” in consumer spending from non-taxed service-based sales to taxable goods, which created “strong market conditions” that led to increased tax revenues from corporate profits and capital gains.
Republicans have also attributed the revenue spikes at least partially to an “inflation-induced sugar high,” noting that as prices increase so does sales tax revenue.
“The influence of these particular factors is expected to wane as the state enters into FY 2023 resulting in reduced revenue expectations for the upcoming fiscal year,” the COGFA report noted.
Still, June’s receipts remained strong, growing by $736 million compared to the previous fiscal year.
As a result, final FY 2022 revenues were $2.6 billion higher than the April estimate from the Governor’s Office of Management and Budget that was used as the basis of this year’s budget negotiations.
A GOMB spokesperson said in an email Wednesday that the surplus has not led to any discussion of amending the FY 2023 budget in the first week of the new fiscal year. But it’s likely to allow for some flexibility.
“FY 2022 revenues continued to outperform expectations through the last quarter of the fiscal year,” GOMB spokesperson Carol Knowles said in an email. “This will allow the state to be better positioned in the coming year as we continue to monitor the national economic outlook.”
Knowles noted that the higher-than-expected revenues contributed to the improving fiscal situation which Comptroller Susana Mendoza and Pritzker highlighted in a pair of news releases last week.
Those releases noted Illinois has erased its “bill backlog,” ending the fiscal year with a general revenue funds payment cycle of zero days from when vouchers are received by the state comptroller’s office.
The $1.8 billion accounts payable balance was a far cry from the height of the state’s two-year budget impasse between Republican Gov. Bruce Rauner and Democrats in the General Assembly, when the bill backlog reached $16.7 billion.
Pritzker has also touted – and bond ratings agencies have noted – that Illinois focused much of its spending of surplus dollars on relieving interest-accruing debt. Illinois has seen six credit rating upgrades – two each from each of the three major agencies – in the past year.
In a news release last week Pritzker contrasted those upgrades with the eight downgrades the state received during the tenure of Rauner, whom Pritzker unseated in 2018.
While the upgrades this year mark the first upward break from a downward trend that began in the Blagojevich administration, Illinois remains in the worst shape of all states as judged by the ratings agencies.
And while Illinois lawmakers dedicated $1 billion to the rainy day fund, Mendoza said in a news release she’d push for laws mandating greater contributions to budget stabilization funds when Illinois has stronger-than-expected revenue performances in the future.
“The fact that we’ll have a billion dollars saved in our rainy day fund to help us during adverse downturns certainly helps, but Illinois must save more when we are able to with stronger-than-expected revenue receipts so that we strengthen our ability to weather through these unexpected crises,” she said.
Capitol News Illinois is a nonprofit, nonpartisan news service covering state government that is distributed to more than 400 newspapers statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
Local News
Comings & Goings: Ross to replace Walt’s at Tinley Park Plaza
Spread the loveBy Bob Bong When Walt’s Foods closed its Tinley Park location almost three years ago, it left a giant hole in the Tinley Park Plaza near 159th Street and Harlem Avenue. That hole will soon be filled with a new 22,000-square-foot Ross Dress for Less store and a 9,800-square-foot Five Below store. A…
SD122 celebrates end of Ramadan at Simmons Middle School
Spread the loveBy Nuha Abdessalam As Ramadan was drawing to a close for Muslims worldwide, District 122’s Superintendent Joseph Matise, Oak Lawn Community High School’s Muslim Students Association club, and the district’s Parents Committee came together to create history. They hosted the first-ever Iftar dinner at Simmons Middle School on April 8, a significant event…
Orland Park Library collecting candy wrappers
Spread the loveBy Kelly White Candy has taken on a whole new life at one local library. The Orland Park Public Library, 14921 S. Ravinia Ave., Orland Park, is happy to announce the launch of its very first Trash or Treasure candy wrapper recycling campaign. The Trash or Treasure program helps reduce the waste that…
Hickory Hills adds new police officer
Spread the loveBy Nuha Abdessalam Hickory Hills Police Chief Jason Bray welcomed Andre Showers as the city’s newest police officer during last week’s city council meeting. Aldermen and the community at the April 11 meeting helped celebrate the induction of the Showers, 21. He’s an Army veteran and a 2023 Cook County Correctional Camp graduate…
Marist celebrates cultural diversity
Spread the loveBy Kelly White Marist High School appreciates the wide array of culture that walks its campus hallways on a daily basis. In order to celebrate, the high school, 4200 W. 115th St., Chicago, hosted its second annual Celebration of Culture on March 14. During the free event, students, faculty and staff represented their…
Palos Heights Knights of Columbus donate to GiGi’s Playhouse
Spread the loveGrand Knight John Laskey and Past Grand Knight Brian Mellenthin of St. Theodore Guerin Knights of Columbus Council 14057 presented a check for $1,500 to GiGi’s Playhouse of Tinley Park, one of several donations to local groups resulting from the Knights of Columbus’ Fall Tootsie Roll Drive. One of the most recognizable activities…
Worth police join task force to combat auto thefts
Spread the loveBy Joe Boyle An agreement has been reached between the villages of Worth and Thornton regarding participation in the Illinois Statewide Auto Theft Task Force. Worth Police Chief Tim Denton said the approval of the memorandum to participate in the task force is necessary. “It’s no secret that there has been an increase…
A simple idea for Earth Day
Spread the love. By Mary Stanek Your correspondent in Archer Heights and West Elsdon 3808 W. 57th Place • (773) 517-7796 . Moving right along through April, as the days get longer and nicer, time will start to go by faster. We have Earth Day on April 22 and the start of Passover at sunset.…
Bingo at St. Clare was something to yell about
Spread the love. Kathy Headley Your correspondent in Chicago Lawn and Marquette Manor 6610 S. Francisco • (773) 776-7778 . Recently I mentioned a bingo fundraiser the Augustinian Young Adults of St. Rita of Cascia Parish were holding. This was their first attempt at a bingo and they put on a really nice event. Held…
Neighbors
One thing is certain: life goes on
Spread the love. Peggy Zabicki Your correspondent in West Lawn 3633 W. 60th Place • (773) 504-9327 . I get a lot of calls from residents who are discouraged about our neighborhood. There are so many car accidents, shootings and violent crimes being committed in West Lawn and surrounding areas. It certainly is challenging to stay hopeful and positive. Here is a paragraph…
Biz groups battle over names, logos
Spread the love. UBAM, MCC trade barbs . By Dermot Connolly and Tim Hadac The leader of one Midway-area business association is accusing the other of bad faith, and the leader of the other is scratching her head over the dustup. United Business Association of Midway Executive Director Anita Cummings recently claimed that a rival…
Chicago Lawn native’s book is ‘off the hook’
Spread the love. Longtime journalist shares humor columns . By Tim Hadac Nancy (Emerson) Besonen has made a career as a news reporter and humor columnist for a weekly paper in Michigan’s Upper Peninsula. But her roots are in Chicago Lawn, and it showed during a recent conversation. Like most true Southwest Siders, she didn’t…
Softball | Oak Lawn’s Kasey Jackson fans 5 in loss to Shepard
Spread the loveBy Xavier Sanchez Correspondent Oak Lawn entered its South Suburban Conference matchup with Shepard having won six of its last seven games. The Astros — even hotter with seven straight victories after beginning the season with three consecutive losses — cooled off the Spartans (8-5, 4-2 SSC) for a day, winning 3-0 behind…
Softball | Shepard blanks Oak Lawn behind CG from Kailey Selvage, 2 RBI from Madison Scapardine
Spread the loveBy Xavier Sanchez Correspondent Temperatures are not the only thing starting to warm up in the Southwest Suburbs. Shepard, which began the season with three consecutive losses, defeated Oak Lawn, 3-0, on April 15 to run its winning streak to seven games. Astros junior pitcher Kailey Selvage tossed a complete-game shutout, striking out…
‘Horrific and unacceptable’
Spread the love. Police, neighbors decry shooting at family party . By Tim Hadac Drive-by shootings have become not at all unusual in recent years in Back of the Yards. Some might even call them common. What is still uncommon is for drive-by crimes to injure or even kill young children. But that is exactly…
A blue salute in Scottsdale
Spread the love. Family, friends, co-workers and neighbors of the late CPD Officer James R. Svec Jr. –as well as elected and appointed officials– gathered at 77th and Kolmar last Saturday to unveil an honorary street sign saluting him for his sacrifice. Officer Svec died at age 59 in December 2021 from causes related to…
County vets offer reduced-price vax clinics
Spread the love. From staff reports The Cook County Department of Animal and Rabies Control is running its annual Partners in Prevention clinics now through mid-October. ARC is partnering with local animal organizations to offer reduced-cost or free one-year rabies vaccinations, as well as microchips. The partnerships are designed to link pet owners to organizations…
Twisted Shamrock hosts Masters-inspired fun
Spread the love. The drive from Chicago to Augusta, Ga. (home of the 2024 Masters professional golf tournament) is more than 800 miles, but those unwilling to make the trek recently had the option of simply heading over to Twisted Shamrock Pub, 6462 S. Central, for some Masters-inspired fun on Sunday, April 14. Both golfers…
St. Laurence grad Brett Buzzelli hurling for Carroll
Spread the loveBy Mike Walsh Correspondent Carroll University senior right-hander Brett Buzzelli has been named the College Conference of Illinois and Wisconsin’s Pitcher of the Week for April 8. Buzzelli was the winning pitcher in an 8-3 victory over visiting Elmhurst University in Game 1 of a CCIW doubleheader. The St. Laurence graduate tossed seven…