- Associated Press - Monday, March 24, 2014

CHICAGO (AP) - Gov. Pat Quinn will deliver a budget address this week that could be the most crucial of his career, as he grapples with a critical decision about raising the tax burden in Illinois at the start of one of the most competitive political campaigns nationwide.

Quinn’s pitch to lawmakers comes as the state confronts the major financial dilemma of whether to extend an income tax increase, and as he faces a serious re-election challenge from Republican Bruce Rauner, who’s already deemed him “the worst governor in America.”

The Chicago Democrat is expected to reveal his proposal for what to do when the temporary tax sunsets, leaving a roughly $1.6 billion drop in revenue and the need for deep cuts - the first major fiscal issue since Rauner won the GOP nomination. Quinn’s speech Wednesday in Springfield will also be his opportunity to deliver a message to critical groups, like unions, that have been disillusioned with him but that he’ll need come November.

“He’s kind of in a trick box,” said Chris Mooney, a political scientist at the University of Illinois at Springfield.

Quinn could let the tax increase expire and deliver bad news to education and public safety workers. “On the other hand, if he says we should make the increase permanent, then he plays right into Bruce Rauner’s hands in the fall,” Mooney added.

Rauner, a Winnetka venture capitalist, won a closer-than-expected GOP primary contest over state Sen. Kirk Dillard after spending and raising millions, including $6 million of his own money. Most of his first bid for public office focused on fighting “government union bosses” and curbing the tenure of career politicians.

Quinn, who easily won his Democratic nomination, has already set out to differentiate himself from Rauner.

He’s questioned Rauner’s business dealings, wealth and flip-flop on the minimum wage. But neither Quinn nor Rauner has offered specifics on the budget, which has been under election year scrutiny.

Quinn asked lawmakers to move his budget speech from Feb. 19 until after the primary, which Republicans deemed as political posturing so Quinn would know his primary opponent. But Quinn said he needed more time to develop a five-year spending plan.

He signed the last temporary tax increase after lawmakers approved it in the final hours of a 2011 legislative session with the idea that the approximately 67 percent increase would help fill a budget hole.

The tax sunset coming in January has set the stage for a fight as Republicans demand the increase be allowed to expire and top Democrats predict dire cuts. The issue erupted Friday during a tense committee hearing where the heads of several state agencies testified and Republicans accused Democrats of putting on a “dog and pony show” to justify another tax increase.

Universities are bracing for deep funding reductions which could mean tuition hikes, increases in student-to faculty ratios and fewer course offerings. Illinois Department of Corrections officials said a 20 percent cut would be “nothing short of disastrous.” Senate President John Cullerton has warned of a $3 billion budget gap - including the $1.6 dip in revenue - that would translate roughly into 27 percent across-the-board cuts, including teacher layoffs.

That worries unions.

Labor played a key role in the primary, with the largest unions backing Dillard and working to defeat Rauner. But now union members want reassurances from Quinn.

Quinn has typically had strong support from unions, and picked up a major endorsement Monday from the Service Employees International Union in Illinois. But many labor groups have been angry with him for withholding pay raises and a landmark pension overhaul that cuts benefits for employees and retirees. Savings from the pension law - which is undergoing legal challenges from unions - won’t be factored into Quinn’s budget.

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