Governor Pritzker Delivers SFY 2022 Budget Address - Proposes LGDF Cut

2/19/2021 Joe McCoy

Governor Pritzker Delivers State Fiscal Year (SFY) 2022 Budget Address 

On February 17, 2021, Governor Pritzker delivered his State Fiscal Year (SFY) 2022 budget address. 

The Governor is proposing a $95.5 billion budget that holds spending at SFY 2021 levels, avoids increasing taxes on families, closes several corporate loopholes, shifts cigarette tax revenue to the State’s General Revenue Fund (GRF) and eliminates an interfund borrowing repayment deadline to allow for more flexibility with cash management. The proposed budget will also hold state spending for K-12 and higher education flat. 

The Governor is also proposing a 10% reduction in Local Government Distributive Fund (LGDF) allocations to municipalities and counties compared to SFY 2021 distributions. As you are probably aware, LGDF is the mechanism through which state income tax dollars are shared with counties and municipalities.

The Governor’s staff suggested that if an adopted budget successfully closes nine corporate tax loopholes an additional $228 million is projected to be available to counties and municipalities on a statewide basis through increased tax collections. A list of the loopholes is available via this link and the amount of additional income tax dollars from the closure of each tax loophole is available here.

Of course, the budget will go through extensive negotiations before a final version is put forward for votes in the House and Senate later this spring and any number of these corporate tax loophole closures may not be included. 

The Illinois State Association of Counties (ISACo) opposes cuts to revenues the state shares with local governments and will engage aggressively and constructively with legislators and the Governor in an effort to prevent any reduction to LGDF distributions. But we need your help! To this end, we have launched a “Protect County LGDF Revenue” page on our website with additional information about LGDF and tools for use in communicating your opposition to the reduction with your state legislators and the Governor.

The Governor’s Office has made the following resources available:

Text of the Governor’s Speech

SFY 2022 Budget in Brief

SFY 2022 State Budget Book

SFY 2022 Capitol Budget

Please let your state legislators know of your opposition to LGDF cuts.