January 07, 2011
Poshard backs proposed state budget plan
CARBONDALE, Ill. -- Glenn Poshard, president of Southern Illinois University, today put his support behind an effort unfolding in the state legislature to solve the state’s $15 billion budget deficit that over the last three years has resulted in deep budget cuts and financial uncertainty for the state’s public universities.
“Our public universities and the students they serve desperately need this financial rescue plan,” Poshard said. “Illinois now owes its public universities more than $500 million. The uncertainty over the state’s ability to pay its obligations has triggered deep cuts in public higher education that have undeniably impacted the affordability of a college degree.”
Media reports of the proposed plan include:
• 2.25 percent rate increase in the state's 3 percent personal income-tax rate, with the rate falling back to a permanent 3.75 percent at the end of four years (expected to raise $6.2 billion). The corporate income tax would temporarily rise from 4.8 percent to 8.4 percent (expected to raise $1 billion).
• $325 property tax credit to homeowners with direct property tax rebate checks in subsequent years.
• $1 increase per pack on cigarettes with the revenue dedicated for educational funding (expected to raise $377 million).
• $12.2 billion debt financing plan that would allow $8.5 billion in overdue bills to be paid to businesses, non-profits, and educational institutions and $3.7 billion in teacher and government worker pension payments due this fiscal year.
The income and tobacco tax increases would be coupled with a three-year, one percent annual cap on government expenditure growth beginning next fiscal year.
“The proposed framework is a bold attempt to get our state back on track,” Poshard said. “The combination of revenue increases and spending cuts is a balanced and responsible approach to the most difficult budget situation the state has ever faced.”
(For more information, contact Dave Gross, 217/545-8080.)