DECATUR – Illinois Department of Veterans Affairs Director Tammy Duckworth joined more than two dozen Decatur organizations and individuals, including healthcare providers and advocates, education supporters, churches, and other nonprofit organizations, to advocate for the Governor’s Investing in Families Initiatives, the Governor’s proposed budget for FY08. The plan includes the Illinois Covered plan to provide affordable comprehensive insurance to all Illinoisans, the Helping Kids Learn plan to invest an additional $10 billion in Illinois schools over the next four years, the Tax Fairness Plan that requires big wealthy businesses to pay their fair share and gives the middle class the relief it deserves, and a plan to address the state’s long-time pension deficit and ensure secure retirements for thousands of workers.
“This year we are taking a leap towards the future,” said Governor Blagojevich. “If the General Assembly passes these initiatives, the future promises fully funded schools for our kids, affordable comprehensive health insurance for all Illinoisans, and a fair tax system. I am proud of the support Decatur small businesses and organizations have given to this plan and look forward to working with them to win legislative support.”
Businesses, local government and nonprofit organizations from the Decatur area are praising Governor Blagojevich’s forward thinking initiatives. With nearly 13% of adults in Macon County without health insurance, many in the area believe that the Governor’s proposed Illinois Covered plan will bring much needed relief.
“We all agree that healthy kids are better learners. Decatur students have benefited for years from our quality education program and a very solid school health program,” said Ann Chelette, Coordinator of School Health Services for Decatur School District 61. “But when cuts have come, we have rightly prioritized the classroom, and scaled back needed health services. Our students face the same health concerns as children throughout the state. Having enough school nurses in place and access to affordable health care for families is critical to assuring students are able to attend school and are ready to succeed.”
Governor Blagojevich has put forth a historic budget proposal with fundamental changes that will benefit the people of Illinois for generations to come. The Governor’s Illinois Covered will ensure all 1.4 million uninsured have access to quality, affordable healthcare, and will help many middle-income families and small businesses that are currently enrolled in health insurance plans save thousands a year on healthcare costs. The plan will also reform the existing healthcare system to improve quality and require more accountability.
“Governor Blagojevich is truly dedicated to helping the working families of Illinois live better, fuller and healthier lives,” said L. Tammy Duckworth, Director of the Illinois Department of Veterans' Affairs. “He created the Veterans Care program to provide affordable health care for our state's veterans who are not covered by the federal Veterans Administration; and he created the All Kids program to provide comprehensive, affordable health insurance for our children. Now we must continue down this path, and help every single one of our veteran's spouses, every child's mother or father, every Illinoisan get access to the healthcare they deserve. I am proud to join Decatur's civic leaders and advocates today who support the Governor’s bold initiatives for working families.”
Also included in the Investing in Families Initiatives is the Governor’s Helping Kids Learn which continues the Governor’s commitment to schools by boosting funding by an unprecedented $1.5 billion in Fiscal Year 2008. Under the plan, general state aid to schools will increase by $800 million, raising the Foundation Level by $724 to $6,058. With more funds per pupil, schools can make investments to improve textbook quality, modernize their technology, or invest in teachers.
Under the plan, the state will give schools additional funds to hire special education teachers and fully fund ‘mandated categorical’ programs like special education and transportation. The plan will accelerate implementation of Preschool for All and dedicate additional resources for school districts that provide full-day kindergarten. Underperforming school districts will get extra funds for if they invest in proven strategies that raise student achievement. For Illinois’s deteriorating schools, the plan will invest in a capital construction plan for projects so children can learn and teachers can teach in a more conducive environment.
The Governor proposed a major reform of Illinois’ corporate tax system in order to provide sustainable funding for education and healthcare. In Illinois, the share of state revenues coming from individual income taxes instead of corporate income taxes has consistently increased during each of the last three decades. To reverse that trend, Governor Blagojevich unveiled a Tax Fairness Plan in his Budget Address earlier this month.
The Governor’s Tax Fairness Plan implements a Gross Receipts Tax (GRT) that has been embraced by many economists because of its broad base and low rates. States including Washington, Delaware and Hawaii have had a GRT for years, and recently, Ohio and Texas have adopted a form of the tax. The tax will better reflect the changes in Illinois’ economy since the Corporate Income Tax was implemented thirty years ago when goods dominated the state’s economy. Today ‘new economy’ businesses – primarily services – represent the majority of Illinois’ business activity. In fact, goods-based businesses make up only 35% of Illinois’ economy, but pay 53% of the corporate income tax; services-based businesses make up 65% of Illinois’ economy, but pay only 47% of the corporate income tax.
The GRT will only apply to businesses that make more than $1 million each year, which means that small businesses – 75% of all businesses in Illinois – will be exempt. The GRT will tax service industries at a low 1.8%, while manufacturers, construction, retail and wholesale companies will be taxed at an even lower .5%. Exports will not be taxed. The plan also mitigates costs being passed on to consumers by excluding certain goods, such as retail food and pharmaceuticals. By transitioning to the GRT, Illinois will rid itself from loopholes that allow major corporations to avoid paying their fair share of taxes to the state, and is expected to generate $3 billion in new revenue in fiscal year 2008, and more than $6 billion during its first full year in effect.
The Governor’s budget also addresses he State of Illinois’ increasing pension obligation – the state’s most pressing structural deficit challenge. Thirty years of under-funding the state employee pension system, combined with passing billions of dollars in unfunded pension sweeteners, has created the largest state pension debt in the nation. Governor Blagojevich laid out a landmark plan that would use the proceeds from a long-term lease the Illinois State Lottery to provide an immediate infusion of at least $10 billion into the state’s pension system. He also proposed issuing $16 billion in pension obligation bonds that will help put the system on stronger fiscal footing. Altogether, the Governor’s plan will save more than $60 billion between now and 2045.