Illinois General Fund Budget

Volume XI of the Fully Funding the EBF series continues CTBA’s modeling of fully funding the EBF to 90% of Adequacy. The update for the FY 2026 Enacted budget uses the shortfall from the ISBE EBF calculations for FY 2026 (released in August of 2025). The Report looks at four different funding scenarios and explains fluctuations in local revenue for districts in the past few years. The analysis includes the full funding model based on the current minimum increase of $300 million annually both with and without considering inflation, if the state were to up the funding to $500 million annually, as well as the annual amount to fund the EBF by FY 2027 as the statute requires.

On June 6, 2024, Governor Pritzker signed into law the General Fund budget for FY 2025 (the “FY 2025 Enacted GF Budget”).  The FY 2025 GF Enacted Budget makes two things clear about the state’s finances.  First, the General Fund continues to be in better fiscal condition than it historically has been over the last three decades. That’s the good news. Second, the state’s structural fiscal problems, which were partially redressed by revenue enhancements passed over the last three fiscal years, as well as somewhat masked by one-time federal financial assistance provided during the pandemic and the strong economic growth that followed, are re-emerging. And that’s the bad news.

Overall, the state’s fiscal condition has improved significantly since Governor Pritzker first took office in 2019. Back then, Pritzker inherited an $8 billion backlog of unpaid bills from Governor Rauner’s Administration.  A budget hole of that size meant roughly 30 percent of all General Fund expenditures during Rauner’s final year as governor constituted deficit spending. Unfortunately, that deficit under Rauner was also nothing new. For more than two decades prior to Pritzker’s inauguration, Illinois had failed to produce anything close to a balanced budget in its General Fund.  

Governor Pritzker started changing that narrative by being a responsible fiscal steward of the state’s finances. Yes, over the past few years Illinois received significant pandemic-related financial support from the federal government, totaling some $6.4 billion, that helped shore up the General Fund during the pandemic.   The state also realized around $4.3 billion in unexpected revenue growth in FY 2024.  This was primarily due to a combination of factors including the robust economic recovery that followed the pandemic, and corporations taking advantage of a 40 year high in inflation to price gouge and thereby generate record profits. The FY 2025 Enacted GF Budget analysis takes an in depth look at Illinois’ revenue and spending in the General Fund for the current fiscal year.

Volume X of the Fully Funding the EBF series continues CTBA’s modeling of fully funding the EBF to 90% of Adequacy. This continuation uses the shortfall from the ISBE EBF calculations for FY 2025 (released in August of 2024). The new release maintains the four scenarios, including the full funding model based on the current minimum increase of $300 million annually both with and without considering inflation, if the state were to up the funding to $500 million annually, as well as the annual amount to fund the EBF by FY 2027 as the statute requires.

On February 21, 2024, Governor Pritzker announced his proposed General Fund budget for FY 2025 (the “FY 2025 GF Budget Proposal”).  The FY 2025 GF Budget Proposal makes two things clear about the state’s finances.  First, the General Fund is the healthiest fiscal condition it has been in for decades. That’s the good news. Second, the state’s structural fiscal problems, which were somewhat masked by one-time federal financial assistance provided during the pandemic, as well as the strong economic growth that followed, are re-emerging. And that’s the bad news.

Overall, the state’s fiscal condition has definitively changed for the better since Governor Pritzker was first sworn into office in 2019. In 2019, Pritzker inherited an $8 billion backlog of unpaid bills from Governor Rauner’s Administration. A budget hole of that size meant roughly 30 percent of all General Fund expenditures during Rauner’s final year as governor constituted deficit spending. Unfortunately, that deficit under Rauner was also nothing new. For more than two decades prior to Pritzker’s inauguration, Illinois had failed to produce anything close to a balanced budget in its General Fund.

Governor Pritzker changed all that by being a responsible fiscal steward of the state’s finances. Yes, over the past few years Illinois received significant pandemic-related financial support from the federal government, totaling some $4.95 billion, that helped shore up the General Fund during the pandemic. The state also realized around $4.3 billion in unexpected revenue growth in FY 2023. This was primarily due to a combination of factors including the robust economic recovery that followed the pandemic, and corporations taking advantage of a 40‑year high in inflation to price gouge, and thereby generate record profits. The FY 2025 Proposed GF Budget analysis takes an in depth look at Illinois’ revenue and spending in the General Fund for the upcoming fiscal year.

Volume IX of the Fully Funding the EBF series continues CTBA’s modeling of fully funding the EBF to 90% of Adequacy. Volume IX uses the proposed Fiscal Year 2025 General Fund Budget appropriations for the Evidence-Based Funding formula, but uses a projected shortfall based on the ISBE EBF calculated shortfall for FY 2024 (released in August of 2023). The new release maintains the four scenarios, including the full funding model based on an increase of $500 million annually using Scenario 2: Funding the EBF on a Fully Inflation-Adjusted Basis, By Making a Nominal Minimum Target Level Increase Annually.

Volume VIII of the Fully Funding the EBF series continues CTBA’s modeling of fully funding the EBF to 90% of Adequacy, which aligns with the Illinois State Board of Education’s methodology. Volume VIII uses the new tier funding and the calculated shortfall based on the ISBE EBF calculated shortfall for FY 2024 (released in August 2023) as well as references Illinois Department of Revenue Corporate Personal Property Replacement Tax from FY 2019-FY2023.

Volume VII of the Fully Funding the EBF series continues CTBA’s modeling of fully funding the EBF to 90% of Adequacy, which aligns more closely with the Illinois State Board of Education’s methodology. Volume VII uses the propsed Fiscal Year 2024 General Fund Budget appropriations for the Evidence-Based Funding formula, but uses a projected shortfall (similar to that of Volume V), based on the ISBE EBF calculated shortfall for FY 2023 (released in August 2022). The new release maintains the four scenarios but adds the full funding model based on an increase of $500 million annually using Scenario 2: Funding the EBF on a Fully Inflation-Adjusted Basis, By Making a Nominal Minimum Target Level Increase Annually

On February 15, 2023, Governor Pritzker delivered the first budget address of his second term to the 103^rd General Assembly. This budget address was markedly different than any previous one delivered by Pritzker—or any other Illinois governor dating back to Jim Edgar in the mid-1990s. The reason: Illinois’ General Fund is in the healthiest fiscal condition it has been for decades.

Things have definitely changed since Governor Pritzker was first sworn into office in 2019. Back then, he inherited an $8 billion backlog of unpaid bills from Governor Rauner’s Administration. A budget hole of that size meant roughly 30 percent of all General Fund expenditures during Rauner’s final year as governor constituted deficit spending. Unfortunately, that was also nothing new, as Illinois had failed to produce anything close to a balanced budget in its General Fund for well over two decades prior.

Yes, over the past few years Illinois received significant pandemic-related financial support from the feds, totaling some $8.4 billion, that shored up the General Fund during the pandemic. The state also realized around $4.9 billion in unexpected revenue growth last fiscal year.

Still, the Pritzker Administration did not cave into political pressure to use either the one-time federal aid, or the unexpected, one-time bump in revenue, to fund a Christmas tree full of goodies. Instead, Pritzker’s Administration leveraged this fiscal largesse to help pay down the state’s bill backlog, pre-pay $700 million in pension debt, deposit over $4 billion into the state’s Unemployment Insurance Trust Fund, and invest close to $2 billion in Illinois’ Rainy Day Fund, so that it now sits at a historically high level—after being reduced to zero by Governor Rauner.