fiscal crisis

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Gov. Bruce Rauner and Illinois lawmakers are contemplating dire economic forecasts as they meet in search of a state budget deal.

Legislative leaders met with the governor at the Capitol on Wednesday and discussed numbers released Tuesday by Rauner's budget director.

They include an estimate that the state will be $7 billion in the red by June 30, and that the backlog of unpaid bills will top $13 billion by then.

The Republican governor and Democratic leaders have been unable to agree on a full-year spending plan for nearly two years.

Illinois' ongoing state budget crisis has led Chicago State University to send out letters to its 900 employees telling them that they could be laid off.


It is not clear how many employees could be laid off but under federal law, employers with more than 100 employees must give 60 days' notice of possible layoffs to all their workers.

Like other public universities, Chicago State has not received any state funding for eight months because of the state's budget impasse.


The Chicago Teachers Union says it has rejected a contract proposal because it does not address school conditions, lack of services to some students and the long-term fiscal crisis that the nation's third-largest school district faces.

CTU said in a news release yesterday that it rejected what it called last week a “serious offer.''

According to the union, the offer would have required teachers to pick up their pension costs and increase contributions to their health care coverage.

Gov. Bruce Rauner says he thinks General Electric bypassed Illinois for its new headquarters because of the “trajectory'' of the state's fiscal problems.

Rauner said Tuesday that he and Chicago Mayor Rahm Emanuel tried to lure GE from Connecticut.

Last week the company announced its relocation to Boston.

Rauner says company officials didn't want to go from “one failed state to another.'' He cited Connecticut's property taxes, income tax and pension problems.

United States Congress

There are growing warnings on Capitol Hill that the nation could be rolling toward an end-of-the-year fiscal train wreck.

"The looming tax hike will be absolutely devastating," Senate Minority Leader Mitch McConnell, R-Ky., said.

"You can call this a fiscal cliff. You can call it 'Taxmageddon' as others have done. Whatever you call it, it will be a disaster for the middle class," Sen. Orrin Hatch, R-Utah, added.

And Sen. Ben Nelson, D-Neb., said: "It's a tsunami; there's no question about it, and it's coming."