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* Last year, Sen. Elgie Sims (D-Chicago) predicted to me that the state budget he and others were crafting was going to lead to the first credit upgrade for Illinois in more than two decades. He was right. So, when I asked the Senate Appropriations Committee Chair this morning about the governor’s proposed budget, he reminded me of his prediction and made another prediction…
You and I talked last year before we passed the 2022 budget, and I was sure, I was very confident that it was going to lead to a credit rating upgrade. I think this budget will do the same. This is going to show taxpayers that we are good fiscal stewards, that we’re taking care of their money they entrust us with. And it’s going to show the rating agencies that Illinois knows how to govern.
Discuss.
…Adding… A comment below made me think that I probably should’ve put this here. Greg Hinz …
The Pritzker administration is promising to inject “substantial” amounts of federal COVID relief cash into the state’s cash-short unemployment insurance program, an action that will reduce and perhaps virtually eliminate the need for sharp tax hikes on employers and/or benefit cuts for workers.
In the first public comments after weeks of behind-the-scenes negotiations, Deputy Gov. Andy Manar said “very productive” talks have advanced enough that Gov. J.B. Pritzker will dangle a big carrot during his speech tomorrow on what will be in his proposed fiscal 2023 budget.
The carrot: allotting a chunk and maybe most of the $3.5 billion the state still has left over from the American Rescue Plan Act of 2021 to begin paying off the roughly $4.5 billion in loans from the U.S. Treasury that kept the unemployment insurance system operational. […]
But Manar did give a tantalizing hint, saying states like Illinois that borrowed from the U.S. Treasury at the height of the pandemic have typically used one quarter to one third of their ARPA funds for such a purpose.
…Adding… Might as well put this here, too…
U of I Flash Index up again in January
URBANA — The resurgence of the University of Illinois Flash Index continued in January, rising to 105.9 from its 105.7 level last month. This reading approaches the post-recession high of 106 from June and September of 2021.
Illinois’ unemployment rate fell to 5.3% from its 5.7% level the previous month and 8% a year ago. Fourth-quarter national gross domestic product rose by 6.9% in real terms. Similarly, the components of the Flash Index (individual income tax, sales tax, and corporate tax receipts) were all up in real terms compared with the same month last year, with especially large percentage increases in corporate and individual income tax collections.
“These strong indicators of economic performance pose a perplexing picture since the emergence of the omicron COVID-19 variant, supply chain disruptions, weakness in financial markets, and the emergence of serious inflation paint a darker image,” said University of Illinois economist J. Fred Giertz, who compiles the monthly index for the Institute of Government and Public Affairs. “There are unanswered questions about whether the relationship of Illinois tax revenues and state economic performance have become untethered; only time will tell.”
Most observers do expect a cooling of the national economy in 2022, in part, because of a paring of expansionary fiscal and monetary policy.
“The strong performance of Illinois revenues has apparently not escaped the notice of Gov. J.B. Pritzker. The governor reportedly plans to call for a one-year, one-billion-dollar tax cut, only 15 months after the failure of a constitutional amendment that would have allowed the state to bring in more revenue through a graduated income tax structure,” Giertz said.
The Flash Index is a weighted average of Illinois growth rates in corporate earnings, consumer spending and personal income as estimated from receipts for corporate income, individual income, and retail sales taxes. These are adjusted for inflation before growth rates are calculated. The growth rate for each component is then calculated for the 12-month period using data through January 31, 2022. Nearing two years since the beginning of the COVID-19 crisis, ad hoc adjustments are still needed because of the timing of the tax receipts resulting from state and Federal changes in payment dates.
…Adding… Press release…
Governor JB Pritzker today announced the State of Illinois has acquired nearly 10 acres of land in the Dirksen Business Park located at 2900 Dotmar for a purchase price of $1.55 million, to construct a new Central Computing Facility (CCF) for the Illinois Department of Innovation & Technology.
“As governor, I’ve sought to bring efficiency and modernization to state government, and this new data center is a key asset in that endeavor,” said Governor JB Pritzker. “Through this new facility, we’re enhancing the State of Illinois’ digital infrastructure and doing so while bringing hundreds of new jobs to the east side of Springfield. I want to recognize Senator Doris Turner for her leadership in bringing this development to the region.”
DoIT’s current central computing facility in Springfield is inefficient and dated. DoIT is working with the Illinois Capital Development Board and the Illinois Department of Central Management Services to build the new CCF in the Springfield area.
“With the evolution of technology and DoIT’s continuing modernization of digital assets, the current data center has grown less suitable for our needs,” said Jennifer Ricker, Acting Secretary for DoIT. “A modern, efficient, and secure data center will allow Illinois to continue to be a leader in technology and innovation.”
Governor Pritzker’s bipartisan Rebuild Illinois capital plan, the first in nearly a decade, appropriated nearly $80.5 million to CDB, who will oversee the project’s design and construction with Exp U.S. Services, serving as the architect of record. The new facility will be programmed to achieve, at a minimum, LEED Silver Certification for data centers.
CMS, who will serve as the owner and property manager of the facility, researched property in the area and subsequently issued a Request for Information (RFI) on June 9, 2021 for the purchase of vacant land within the City of Springfield to construct a CCF. The selected 9.4 acre site is located within an Enterprise Zone and offers access to a fiber network, synergies to nearby State offices, and close proximity to transportation options.
“This investment is further evidence the State of Illinois is striving to deliver the best, most cutting-edge infrastructure to support our operations,” said Janel L. Forde, Director for the Department of Central Management Services. “The new state-of-the-art facility will be built with the most advanced infrastructure technology, and designed with the highest standards of redundancy, resiliency, and reliability.”
“The relocation of the Central Computing Facility is a game changer for the East Side of Springfield – an area I was proud to represent on the Springfield City Council,” said State Senator Doris Turner (D-Springfield). “The new data center will spur additional economic development to the area and expand our technological opportunities. I am proud and thankful that Governor Pritzker is prioritizing Springfield in the ambitious Rebuild Illinois Project.”
The relocation of the CCF to the East Side of the City will also bring hundreds of State jobs to the area, spur economic development, and ensure the State’s technology infrastructure keeps pace as technologies advance.
The historic Rebuild Illinois capital plan passed with bipartisan super-majorities will invest $45 billion in roads, bridges, railways, universities, early childhood centers, and state facilities that will create and support an estimated 540,000 jobs over the life of the six-year plan and revitalize local economies across the State.
posted by Rich Miller
Tuesday, Feb 1, 22 @ 10:42 am
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Awesome news, I’m still waiting to hear the plan on that unemployment debt tho. I’m glad they don’t seem too concerned. I wonder if the Governor’s tax rebates are part of Sen Sims thinking
Comment by SWIL_Voter Tuesday, Feb 1, 22 @ 10:53 am
I am sure I am in the minority as an above income, middle class Illinoisan, but I would rather we not cut taxes, and take care of our outstanding fiscal obligations. Imagine a healthy retirement fund.
Comment by H-W Tuesday, Feb 1, 22 @ 10:57 am
Well… I have hope. He was right the last time. But right now, we are just talking in the abstract. I need to see some numbers.
Comment by Ducky LaMoore Tuesday, Feb 1, 22 @ 11:04 am
The name of the game is good fiscal stewardship and improvement. It’s more impressive given the intentional Rauner-Griffin damage. Now this crew is back, with Griffin ready to pour millions into it, which highlights the difference even more.
Who’s ready to take the Griffin millions and get fully Raunerized, purposely joining with the destructive legacy?
Comment by Grandson of Man Tuesday, Feb 1, 22 @ 11:09 am
“Watch what does happen”
I do love the optimism, as I want the state to succeed, those doomsayers, those rooting against Illinois, those grifting off the phony angst driven *by* the grifters might be miffed… but that’s also good too.
Comment by Oswego Willy Tuesday, Feb 1, 22 @ 11:10 am
Nice to see positive news when it come sto state finances. The haters will continue to discuss the past, but the reality is different.
Comment by JS Mill Tuesday, Feb 1, 22 @ 11:29 am
Regarding the unemployment insurance trust fund: it is nice to “begin paying off” the loan, but if there is any loan balance on Nov. 10 of this year, then the automatic tax increase on employers kicks in for next year. I hope there is a plan to prevent that from happening. They could even just take out a short-term borrowing to get the unemployment fund to a $0 balance on Nov. 10 and repay that loan with less money than the combined effect of the interest on the unemployment loan balance and the year of increased taxes on employers.
Comment by Unemployed Tuesday, Feb 1, 22 @ 11:42 am
Since we didn’t get a progressive income tax, cutting regressive taxes is the only way to introduce some progressivity into the Illinois tax system.
Comment by Banish Misfortune Tuesday, Feb 1, 22 @ 12:46 pm
Employers are supposed to pay to fund the UI Trust Fund. They always resist paying. Disappointing that the Governor is going to let them off the hook.
Comment by UI Trust Fund Tuesday, Feb 1, 22 @ 3:52 pm
Central Computing Facility (CCF)? With the migration to cloud computing by technology leaders why does DoIT think they need their own data center?
Comment by IT Guy Tuesday, Feb 1, 22 @ 7:26 pm
That COVID relief money goes to people who need it, not the banks. #StopTheSqueeze
Comment by Kathy Powers Thursday, Feb 3, 22 @ 7:40 pm