A new report shows Illinois will face a $3 billion deficit in 2026

The relative financial calm that has characterized Illinois Gov. JB Pritzker's six-year term may soon come to an end on Friday forecast a budget deficit of more than $3 billion for the next fiscal year.

This marks a stark difference from the years in which the state ran budget surpluses under his watch, and presents the governor with a painful array of possible solutions as he ponders whether he will seek a third term in 2026.

Without new revenue or spending cuts, Pritzker's budget office estimates a budget deficit of $3.17 billion at the end of fiscal year 2026, which would be mid-2026 as the gubernatorial election is in full swing.

To address the problem, it is not clear whether the governor and the Democratic majority in the House and Senate would support tax or fee increases; spending cuts; delays in payment of government bills; leveraging the state's $2.2 billion rainy day fund; or a combination of these options.

“While balancing spending pressures remains a daunting challenge given the stagnant revenue outlook, the Governor remains committed to taking action to further improve Illinois' fiscal position and address any budget deficits that may arise – as he has done every year since taking office “took office in 2019,” the Governor’s Budget Office said in a statement accompanying the forecasts. “The ability to fund new programs will be severely limited.”

The Republicans pounced on the new budget figures.

“This guy is spending the first six years of his term as governor like a drunken sailor. Here we are,” said state Sen. Chapin Rose, R-Mahomet, the ranking Republican on the Senate Appropriations Committee.

Rose said the willingness of Illinois taxpayers to shoulder tax or fee increases is “about zero.”

“But that doesn’t mean the progressive left Democrats with their supermajority won’t do it anyway,” Rose said. “I mean, have you talked to anyone who went to the grocery store lately?”

The Governor's Office of Management and Budget estimates that sales tax revenue – one of the state's main budget drivers – will decline slightly year-over-year in fiscal year 2026.

And on the spending side of the ledger, Pritzker's budget forecasters see significant increases for education, human services and health insurance for state workers, lawmakers, judges and their dependents.

Asked whether the governor would seek a tax increase to close the planned gap, Pritzker's office responded Friday evening that it was only a forecast and he intended to present a balanced budget.

Dave McKinney covers Illinois government and politics and was the longtime Springfield bureau chief for the Chicago Sun-Times.