CHICAGO

Threat Of Budget Cuts Draws Thousands To Springfield, But No Progress On Tax Hike Talks

07/24/2009 05:12 am ET | Updated May 25, 2011

SPRINGFIELD (AP) -- Illinois lawmakers returned to the Capitol on Tuesday searching for some way to fill a $9.2 billion hole in the state budget.

The date may be the only thing that has changed since they left town May 31.

Gov. Pat Quinn still warns drastic budget cuts will be required without a tax increase. Democratic legislative leaders still say they want an increase but lack the votes to pass it. Republicans still oppose the idea.

Along with legislators, thousands of protesters showed up at the Capitol to demand a tax increase that would prevent the worst of the budget cuts. Officials said the rally drew more than 5,000 people waving signs in support of services for women, children, senior citizens, disabled people and more. (Scroll down for video.)

"It's gratifying to see so many people here at decision time," said Quinn, a Chicago Democrat. "It's really a powerful outpouring of grass-roots sentiment."

Time is running out for officials to make a decision. The current budget expires June 30. After that, state government will face strict limits on spending money and soon could have to cut back on state services.

The House and Senate met for a few minutes Tuesday afternoon, responding to Quinn's call for a special session. Neither took any action, but they're scheduled to return Wednesday.

Officials don't have any good options.

They could close the budget gap -- which already has been reduced from $11.6 billion or more -- with a combination of spending cuts and tax increases, but many legislators oppose raising taxes.

They could close the deficit solely with spending cuts, but Quinn and many lawmakers consider that unacceptable because it would gut vital state services.

"I am not going to preside over a dismantling of that fundamental safety net that we are proud of in Illinois," Quinn said.

Officials also could postpone any real decision by extending the current budget for a month or two, or by sticking with the limited new budget they've approved and promising to come back in January to do more.

-ASSOCIATED PRESS

Gov. Quinn said last week that he wanted a vote on the income tax. The Sun-Times cast doubt on that deadline when it obtained a memo from House Speaker Michael Madigan that didn't include the vote on this week's planned agenda, and today Quinn said he expects a vote by the end of the month.

Quinn may have helped his cause by softening his stance on the corporate income tax, the Tribune reports:

Quinn is backing a temporary income tax increase that would raise the personal rate from 3 to 4.5 percent for two years. The proposal previously would have raised the corporate income tax rate from 4.8 percent to 7.2 percent, but Quinn said today he's willing to lower that number. He would not provide specifics.

State Comptroller Dan Hynes threw some cold water on his fellow Democrat Tuesday, releasing a letter accusing Quinn of inconsistencies in his approach to the budget talks and inciting "fear and panic" about potential state service cuts.

Capitol Fax has excellent coverage of the thousands-strong rally, which at one point closed down the Statehouse.

Watch these videos for a taste of the rally:

Gov. Quinn's speech:

More from Captiol Fax here.

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