State Budget Practice Report Cards and Budget Resource Guide
Illinois has become synonymous with “broken budget process” and failed even to pass a budget in 2016 and 2017. Though budgets were enacted for fiscal 2018 and 2019, the state has not weaned itself from one-time actions to achieve fiscal balance.
In budget maneuvers, the state received a D average for 2016 through 2018, with a D-minus, the lowest mark possible, for 2018. The drop reflected the assumption that $300 million would be contributed to revenues from the sale of the Thompson Center, a Chicago complex housing state offices, stores, and restaurants. The planned sale was shelved after budget enactment, leaving the state with a hole and showing the risk of counting on one-time revenues that may not be repeated or even realized. Illinois was also one of only eight states to fund recurring expenditures with debt in 2018.
Illinois received a three-year average of D-minus in legacy costs. It was one of only seven states that failed to make contributions in line with actuarial recommendations for public worker pensions and other postemployment benefits, principally health care, in all three years studied. As of 2017, Illinois had set aside only 38.4 percent of the assets needed to meet its pension obligations, the third-worst funding level, behind Kentucky and New Jersey.
Forty-five states reported a positive balance in rainy day or other reserve funds in fiscal 2018, while Illinois was one of five with barely any rainy day assets—a driver of its D average in that category. In fiscal 2017, its rainy day fund would have covered the state’s needs for two hours, according to Comptroller Susana Mendoza.
Illinois also scored a D average in budget forecasting, despite some improvements that lifted its annual grade to a B in 2018. While the governor’s Office of Management and Budget increased its forecast period to five years from three in fiscal 2017, the state failed to receive credit in our evaluation for producing long-term estimates in the years it failed to pass a budget (2016 and 2017).
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2016 through 2018. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eight US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.