Democrats Pass $55.2 Billion Budget. Another year, another budget, and another near-record-breaking spending increase.
Just before midnight on the last day of the legislative session, Illinois House Democrats passed the FY26 budget that will cost taxpayers more than $55.2 billion, a $2 billion increase over last year.
State spending under Governor Pritzker has grown exponentially since he took office in 2019. When he took over as Governor, state expenditures were $40.3 billion. Each year since we have seen state spending grow and we now have a budget that is $15 billion higher than when he took office.
When Governor Pritzker delivered his Budget Address in February, he said, “If you come to the table looking to spend more – I’m going to ask you where you want to cut.”
So much for that sound bite. The newly passed budget contains $1 billion in tax hikes and fund sweeps to pay for new spending, pork barrel projects for Democrats, and pay raises for politicians.
For several years in a row, the Democrats have negotiated spending plans behind closed doors, excluded Republican input, rejected accountability, and raised taxes on Illinoisans in order to quench their never-ending thirst to spend more money.
House Republicans have repeatedly offered to work with the majority party to craft a balanced budget without tax hikes, but were once again completely shut out of the process.
Democrats succeeded in incorporating near-record spending and huge tax hikes in the FY26 budget, showing no fiscal restraint and failing to implement structural reforms. Democrats even rewarded themselves with hundreds of millions in pork projects and a big fat pay raise for politicians in the budget. All on the taxpayer’s dime. Like a kid in a candy store, Democrats can’t seem to control themselves.
Here's what some of our legislative members are saying:
“Rather than pursuing meaningful structural reforms to secure our state’s future, Democrats chose to prioritize politician pay raises, steal from the rainy-day fund, and funnel money into their own pork projects.” ~ House Minority Leader Tony McCombie
“The tax-and-spend budget passed by Illinois Democrats is completely irresponsible. It’s a $55 billion budget that relies on $1 billion in new taxes, a massive number of fund sweeps, and hundreds of millions of dollars in Road Fund diversions. What’s in this budget? Pay raises for politicians. Nearly $250 million in pork projects for Democratic legislators aka the ‘Democratic Majority Slush Fund’ and an additional $100 million slush fund for the Governor. ~ Deputy House Republican Leader and Republican Budgeteer Norine Hammond
“This budget is a disaster for hardworking Illinois families. A billion dollars in new taxes, hundreds of millions of dollars in Road Fund diversions, and a massive number of fund sweeps are how the Democrats filled the budget hole created by their reckless spending. There’s no property tax relief or tax cuts for working families anywhere to be found in this budget. But Democrats are spending $110 million of our tax dollars on welfare benefits for illegal immigrants. Tax, spend, repeat!” ~ Assistant Republican Leader C.D. Davidsmeyer
“This budget doesn’t reflect Illinois values—it reflects bad governance. Every dollar spent on enabling Illinois’ financial crisis is a dollar taken away from the law-abiding Illinoisans who pay their taxes, play by the rules, and now feel abandoned by their government.” ~ Assistant Republican Leader John Cabello
$1 Billion in New Taxes and Fund Sweeps. The $55.2 billion budget for Fiscal Year 2026 is reliant on one-time revenues and a billion dollars in tax hikes and fund sweeps.
The Budget and Revenue Package consisted of three major components:
- FY26 Budget Appropriations – SB 2510
- FY 26 Budget Implementation Bill (BIMP) – HB 1075
- FY 26 Revenue Package – HB 2755
Ultimately, Democratic lawmakers voted to raise their own pay, impose new taxes, and make life in general a lot more expensive for already cash-strapped Illinois taxpayers.
Below is a list of major revenue changes that were included as part of the FY26 budget, which includes tax increases, fund sweeps, pauses in statutory transfers, among other items.
|
Revenue Used to Balance the Budget |
||
|
Tax Changes |
Bill Number |
Estimated Value |
|
Delinquent Tax
Payment Incentive Program |
HB 2755 |
$228 million |
|
GILTI tax treatment
of global intellectual property |
HB 2755 |
$200 million |
|
Pause final shift
of State sales tax on tor fuel to Road Fund |
HB 2755 |
$171 million |
|
Tobacco/Nicotine
products tax hike, including e-cigarettes, pouches |
HB 2755 |
$79 million |
|
Move to “Finnegan”
method for interstate income allocations |
HB 2755 |
$72 million |
|
Per-wager tax on
Tier 1/Tier 2 sportsbook wagers |
HB 2755 |
$36 million |
|
Telecommunications
tax increase ($74m total/$35m - GRF share) |
HB 2755 |
$35 million |
|
Franchise Tax
Amnesty |
HB 2755 |
$5 million |
|
Other changes
involving motor vehicle use tax and rolling stock |
HB 2755 |
|
|
Subtotal |
|
$826 million |
|
Fund Sweeps and Transfers |
||
|
Pause statutory
transfers into the Rainy Day Fund (one year) |
HB 1075 |
$45 million |
|
Various Funds swept
into new BRIDGE Fund |
HB 1075 |
$100 million |
|
Sweep newly created
Prescription Drug Affordability Fund (PBM Bill) |
HB 1075 |
$140 million |
|
Sweep Insurance
Producer Administration Fund to GRF |
HB 1075 |
$20 million |
|
Sweep IL
Agricultural Loan Guarantee Fund to GRF |
HB 1075 |
$6 million |
|
Sweep Illinois
Farmer and Agribusiness Loan Guarantee Fund |
HB 1075 |
$4 million |
|
Subtotal |
|
$315 million |
|
Running Grand Total |
|
$1.141 billion |
PUBLIC CORRUPTION
Federal Prosecutors Seek 12.5-Year Sentence for Madigan. The federal government is seeking a prison sentence of 12.5 years and a fine of $1.5 million for former Speaker of the House Michael J. Madigan, who was convicted on corruption charges earlier this year. Madigan will face sentencing on June 13.
"The crimes charged and proven at trial demonstrate that Madigan engaged in corrupt activity at the highest level of state government for nearly a decade," federal prosecutors argued in their sentencing memo. "Time after time, Madigan exploited his immense power for his own personal benefit by trading his public office for private gain for himself and his associates, all the while carefully and deliberately concealing his conduct from detection."
Madigan’s long-running reign as Speaker of the House ended with his ouster in January 2021 amid a federal bribery investigation. He resigned his legislative seat one month later. Madigan had served in the legislature for more than 50 years, 36 of those years as Speaker. For much of that time, he simultaneously led the Illinois Democratic Party, tightening his stranglehold not just on legislators, but on all Democratic elected officials in Illinois.
“Mike Madigan’s fall from power is no surprise — it’s the bill coming due for decades of corruption,” stated House Republican Leader Tony McCombie after learning of the recommended sentencing. “He betrayed the public trust, lined his pockets, and now faces justice. Illinois deserves better. It’s time to turn the page and end the era of crooked politics for good.”
Republicans continue to call for stronger ethics measures in the wake of Madigan's conviction.
“No amount of time behind bars can pay back the people of Illinois for the corruption that Mike Madigan poisoned our statehouse with over his decades in power, but I commend federal prosecutors for seeking as strong a sentence as they could," said Deputy Republican Leader Ryan Spain. “While I won’t hold my breath waiting for it, this should be a message to Democrats in the legislature that it is long past time to fix the ethical loopholes in Illinois government that have eroded public trust.”
“I’ve said more times than I can count, Illinois needs to act on ethics reform, so we can stop relying on federal prosecutors to clean up our mess," continued Spain. "The time for honest, transparent government in the state of Illinois is now!”
CONSUMERS
Controversial ‘swipe fee’ delayed for one year. In a last-minute move, a massive change being imposed by the State of Illinois on Illinois consumers who use credit cards was delayed for one year. The controversial ‘swipe fee’ law would ban financial institutions that issue credit cards from imposing a fee on the retailers that accept these credit cards for use in Illinois. The law was enacted in May 2024 for implementation this year.
For complex legal reasons, this ‘swipe fee’ law is entangled with the transactions on which an Illinois State sales tax is collected. This would create a complex and snarled situation in which a transaction could be fee-imposed and taxed in two separate categories depending on the sales tax applicability of each transaction. An especially ugly scenario arose with respect to food service transactions, where it appeared likely that implementation of the controversial ‘swipe fee’ law could require many Illinois consumers who use their credit cards at table-service restaurants to run their cards twice, once for the meal and once for the service fee or tip paid to personnel. The action by the Illinois General Assembly to delay implementation of the ‘swipe fee’ does not make this law go away; its implementation has been ‘paused’ for one year. This debate will continue into the 2026 spring session.
Federal Prosecutors Seek 12.5-Year Sentence for Madigan. The federal government is seeking a prison sentence of 12.5 years and a fine of $1.5 million for former Speaker of the House Michael J. Madigan, who was convicted on corruption charges earlier this year. Madigan will face sentencing on June 13.
"The crimes charged and proven at trial demonstrate that Madigan engaged in corrupt activity at the highest level of state government for nearly a decade," federal prosecutors argued in their sentencing memo. "Time after time, Madigan exploited his immense power for his own personal benefit by trading his public office for private gain for himself and his associates, all the while carefully and deliberately concealing his conduct from detection."
Madigan’s long-running reign as Speaker of the House ended with his ouster in January 2021 amid a federal bribery investigation. He resigned his legislative seat one month later. Madigan had served in the legislature for more than 50 years, 36 of those years as Speaker. For much of that time, he simultaneously led the Illinois Democratic Party, tightening his stranglehold not just on legislators, but on all Democratic elected officials in Illinois.
“Mike Madigan’s fall from power is no surprise — it’s the bill coming due for decades of corruption,” stated House Republican Leader Tony McCombie after learning of the recommended sentencing. “He betrayed the public trust, lined his pockets, and now faces justice. Illinois deserves better. It’s time to turn the page and end the era of crooked politics for good.”
Republicans continue to call for stronger ethics measures in the wake of Madigan's conviction.
“No amount of time behind bars can pay back the people of Illinois for the corruption that Mike Madigan poisoned our statehouse with over his decades in power, but I commend federal prosecutors for seeking as strong a sentence as they could," said Deputy Republican Leader Ryan Spain. “While I won’t hold my breath waiting for it, this should be a message to Democrats in the legislature that it is long past time to fix the ethical loopholes in Illinois government that have eroded public trust.”
“I’ve said more times than I can count, Illinois needs to act on ethics reform, so we can stop relying on federal prosecutors to clean up our mess," continued Spain. "The time for honest, transparent government in the state of Illinois is now!”
CONSUMERS
Controversial ‘swipe fee’ delayed for one year. In a last-minute move, a massive change being imposed by the State of Illinois on Illinois consumers who use credit cards was delayed for one year. The controversial ‘swipe fee’ law would ban financial institutions that issue credit cards from imposing a fee on the retailers that accept these credit cards for use in Illinois. The law was enacted in May 2024 for implementation this year.
For complex legal reasons, this ‘swipe fee’ law is entangled with the transactions on which an Illinois State sales tax is collected. This would create a complex and snarled situation in which a transaction could be fee-imposed and taxed in two separate categories depending on the sales tax applicability of each transaction. An especially ugly scenario arose with respect to food service transactions, where it appeared likely that implementation of the controversial ‘swipe fee’ law could require many Illinois consumers who use their credit cards at table-service restaurants to run their cards twice, once for the meal and once for the service fee or tip paid to personnel. The action by the Illinois General Assembly to delay implementation of the ‘swipe fee’ does not make this law go away; its implementation has been ‘paused’ for one year. This debate will continue into the 2026 spring session.
FIREARMS
House Republicans Vote to Protect the Rights of Law-Abiding Gun Owners, Stand Against Unconstitutional Storage Restrictions. State Representative Patrick Windhorst issued the following statement after Republicans voted NO on Senate Bill 8 and House Bill 850 late Wednesday evening. The House Republican Floor Leader cited serious constitutional concerns for the rights of law-abiding gun owners.
“Senate Bill 8 is an overreaching and constitutionally dubious attempt by the majority party to further restrict the Second Amendment rights of responsible Illinois citizens,” said Windhorst. “This bill creates excessive and confusing firearm storage mandates, subjects law-abiding gun owners to stiff civil penalties, and places them at risk of prosecution for simply exercising their right to self-defense.”
Senate Bill 8, also known as the Safe Gun Storage Act, imposes new mandates requiring gun owners to store firearms in locked containers when in the presence of minors, prohibited persons, or so-called “at-risk” individuals. Rep. Windhorst noted that the bill is riddled with conflicting provisions and creates legal uncertainty for hunters, target shooters, and youth shooting clubs.
“Democrats have pushed a law that is not only unworkable but also invites legal challenges by contradicting recent U.S. Supreme Court rulings affirming individual gun rights,” Windhorst continued. “This bill effectively criminalizes responsible gun ownership and punishes the very people who are already taking the right steps to safely store their firearms.”
Additionally, SB 8 requires gun owners to report stolen firearms within 48 hours or face civil penalties, despite most gun owners already acting responsibly and taking such steps voluntarily. Windhorst also raised alarms about a provision that gives greater Second Amendment rights to non-residents transporting firearms through Illinois than to state residents themselves.
Representative C.D. Davidsmeyer debated the Democratic sponsor of Senate Bill 8, a burdensome gun storage requirement. Davidsmeyer stood up for the 2nd Amendment rights of hunters and gun owners in opposition to SB 8, which narrowly passed the Illinois House on May 28.
House Republicans also voted against an amended House Bill 850. The bill makes changes to Illinois’ Clear and Present Danger statute in a way Windhorst says strips due process protections and will lead to further constitutional violations.
“HB 850 was rushed to the House Floor without a public Committee hearing. The bill is an attempt by Illinois Democrats to provide legal cover for unconstitutional firearm policies,” Rep. Windhorst stated. “It allows the state to revoke FOID cards without a formal hearing or adequate opportunity for the individual to contest the accusation, violating both Second Amendment rights and due process.”
After legislative session adjourned Wednesday night, House Minority Leader Tony McCombie released the following statement:
“Democrats spent more time extolling the virtues of violating federal immigration laws than they did taking away the Second Amendment rights of law-abiding gun owners.”
TRANSPORTATION
No Action Taken on Chicagoland Mass Transit Crisis. With public transit agencies in Chicagoland facing a fiscal cliff and the potential for thousands of layoffs, the state did not pass a bill that would have provided the agencies with potentially over $1 billion in new funding.
A version of the bill passed in the Senate, sponsored by Sen. Ram Villivalam, D-Chicago. But the House adjourned early Sunday morning without concurring as some of its tax hikes became too controversial. Now, the future of Chicagoland transit is in limbo as the bill awaits further action.
The Regional Transportation Authority — which oversees the Chicago Transit Authority, Metra commuter rail and Pace Suburban Bus — projects a $771 million annual operating budget shortfall.
At a hearing in the days leading up to adjournment, Amalgamated Transit Union political director Clem Balanoff told lawmakers that thousands of union bus drivers and train operators would be laid off if action wasn’t taken to fill the budget gap. RTA officials have estimated 40% service cuts are necessary to address the fiscal crisis. […]
The Senate’s proposal to do so included statewide taxes on deliveries and electric vehicle charging, as well as expanding taxes on rideshares and expanded certain Chicago taxes to the rest of Cook County and surrounding counties.
RTA and its subsidiary transit agencies will create their budgets for the upcoming fiscal year in the coming weeks. According to RTA spokesperson Tina Fassett Smith in a statement, those budgets “by law must only include funding we are confident the system will receive in 2026.”
Between the governance and the revenue portions - the transit system’s fiscal cliff is approaching. A wide variety of major decisions as to how public transit is run, how it can be reformed, and ultimately how it can serve residents better remain since nothing was done this session.
Transit reform is something that lawmakers must address. House Republicans can get on board with the governance piece, but any revenue increase to pay for it will be an extremely hard sell, especially in this difficult budget climate.