The good news is that the state's revenues were up – $469 million in August, compared with August a year ago. The not-as-good news is the gains were from things you cannot count on month after month. An example: most of that increase – $397 million – is from a buildup in the state's “income tax refund fund,” which must transfer into the general fund at the end of each fiscal year.
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Jim Muschinske, revenue manager for the state's Commission on Government Forecasting and Accountability, says what the state really needs is jobs: “On a month basis, compared to the same period of a year earlier,” he says, “we've had six months of declines. So we have less people working now than what we did a year ago.”
He calls sales tax receipts surprisingly strong but cannot pinpoint a reason. That growth was $65 million.
After 2014, unless the legislature takes action, the 5 percent Illinois income tax reverts to 3.75 percent. Muschinske knows that will take some tough conversations. “There will be those who say that we just simply can't afford” not to keep the 2011 increase, he says, but others would say the temporary nature of the increase“was a deal made at the time for the taxpayer, and they have every reason to expect us to fulfill that promise.”