802 Stratton Ofc. Bldg., Springfield, IL 62706
MONTHLY BRIEFING FOR THE MONTH ENDED: OCTOBER 2019
http://cgfa.ilga.gov

SENATE
Heather Steans, Co-Chair
Donald DeWitte
David Koehler
Elgie Sims
Dave Syverson
Jil Tracy
HOUSE
C.D. Davidsmeyer, Co-Chair
Thomas Bennett
Sonya Harper
Elizabeth Hernandez
Anna Moeller
Joe Sosnowski
EXECUTIVE DIRECTOR
Clayton Klenke
DEPUTY DIRECTOR
Laurie Eby
INSIDE THIS ISSUE

PAGE 1: ECONOMY: Too much worry?
PAGE 3: Illinois Economic Indicators
PAGE 3: REVENUE: October Receipts Spurred
Higher by Court Settlement Proceeds and Federal
Sources
PAGE 5 - 6: Revenue Tables

Economy: Too much worry?
Julie Bae, Pension Analyst/Economic Specialist
Since the Great Recession, the U.S. economy is now
in the longest expansion in history. However, history
tells us the expansion in the business cycle will end at
some point. Recently, fear of the next recession has
been exacerbated due to weaker domestic growth and
a global slowing, along with other uncertainties
including trade talks with China. That being said, the
most recent economic data suggests we are doing fine
– for now.
The U.S. Bureau of Labor Statistics reported last
Friday that the U.S. added 128,000 jobs in October, a
solid figure, considering the recent strike at GM that
lasted for nearly 6 weeks and a decrease in the number
of temporary Federal government employees.
Previously reported data for August and September
was revised up significantly by 51,000 and 44,000 to
219,000 and 180,000, respectively. The average
monthly job gain so far this year is 167,000, which is
lower than an average monthly increase of 223,000 in
2018. While the unemployment rate inched up by
0.1% to 3.6% from the previous month, it is still near
the lowest level since 1969. Overall, the October
employment report that beat expectations indicates
that the job market may have slowed down, compared
with last year, but continues to perform at a solid rate.
In addition, the U.S. economy grew at an annual rate
of 1.9% in the third quarter of 2019, somewhat higher
than expected, but down slightly from the pace of 2%
in the second quarter, according to data released by
the U.S. Commerce Department. The higher-thanexpected pace resulted from positive consumer
consumption and government spending, but was

 partially offset by weak business investment.
Consumer spending, the engine of the U.S. economy
as it accounts for approximately 70% of the gross
domestic product, shows a similar story as well. The
Personal Consumption Expenditures (PCE) gained

0.2% from last month or 3.9% from a year earlier. The
Commerce Department reported last Thursday that
new automobiles and health care spending were the
biggest contributors to the gain.

Meanwhile, the Fed lowered its target rate last week
by 25 basis points to a range of 1.50% and 1.75%, the
third rate cut this year. The Fed also signaled that a
higher hurdle would be required for the next rate
reduction to happen, suggesting that the economy
appears to be stabilizing, at this time. The series of
recently released data validate the Fed’s move as well.

IHS Markit, the Commission’s economic forecasting
service, wrote in a recent report, “the outlook for
underlying growth in demand remains solid. Strong
financial conditions, including record high readings
on the S&P 500 equity index and low borrowing
costs, support healthy growth in spending, as do
strong labor markets and gains in real income. We
continue to anticipate that solid growth through 2020
and strong labor markets will support expectations
for an eventual reversal of the 2019 rate cuts,
beginning in late 2020 and through 2021.”

Still, there are some uncertainties that complicate the
outlook, such as trade policies, weakening global
growth, muted inflation, etc. Unfortunately, it is
difficult to predict the precise timing of the next
recession.

-2-

 INDICATORS OF ILLINOIS ECONOMIC ACTIVITY
INDICATORS*

LATEST MONTH PRIOR MONTH

Unemployment Rate (Average) (Sept.)
Inflation in Chicago (12-month percent change) (Sept.)

3.9%
1.4%

LATEST MONTH
Civilian Labor Force (thousands) (Sept.)
Employment (thousands) (Sept.)
Nonfarm Payroll Employment (Sept.)
New Car & Truck Registration (Sept.)
Single Family Housing Permits (Sept.)
Total Exports ($ mil) (Aug.)
Chicago Purchasing Managers Index (Oct.)

6,505.9
6,250.0
6,186,700
60,973
831
4,950.0
43.2

4.0%
1.6%

A YEAR AGO
4.2%
1.6%

CHANGE OVER CHANGE OVER
PRIOR MONTH
A YEAR AGO
0.0%
0.1%
4,800
-1.8%
12.1%
4.7%
-8.3%

0.7%
1.0%
66,600
29.5%
-2.1%
-9.0%
-26.0%

* Due to monthly fluctuations, trend best shown by % change from a year ago
REVENUE: OCTOBER RECEIPTS SPURRED HIGHER BY COURT SETTLEMENT PROCEEDS
AND FEDERAL SOURCES
Jim Muschinske, Revenue Manager
Excluding last fiscal year’s $500 million in
Treasurer’s Investments, base October revenues
increased by $209 million. A large component of the
monthly gain was $193 million in court settlement
proceeds related to drug company recoveries via the
Attorney General’s Office (more information is here
http://www.illinoisattorneygeneral.gov/pressroom/20
19_10/20191028.html). In addition, a comparatively
better month for federal sources also aided in the
monthly gain, while transfers were weaker and most
other revenue sources performed unspectacularly.
October had the same number of receipting days as
last fiscal year.

Despite an overall positive month for revenues, a few
sources experienced declines in October, albeit at
relatively low levels. While the volatile source of
estate taxes dropped $19 million for the month, gross
personal income taxes dipped $5 million, or $1
million net. Vehicle use taxes declined by $2 million
and cigarette tax receipts by $1 million.
Overall transfers declined $179 million in October.
Of that amount, $127 million was due to timing
related to transfers from the Income Tax Refund
Fund. Miscellaneous transfers were down $35
million for the month, while riverboat transfers were
off $12 million, and lottery transfers declined $5
million. As indicated, federal sources posted a sizable
increase of $162 million for the month, although like
September, the gain was more due to an extremely
poor showing last year.

For the month, the revenue line “Other Sources” was
boosted $177 million due to the court settlement
proceeds. Gross sales tax turned up $7 million, or $34
million on a net basis. Gross corporate income taxes
increased $14 million, or $12 million on a net basis.
Public utility tax receipts grew $12 million, interest
earnings improved by $9 million, insurance tax
revenues increased $3 million, and corporate
franchise taxes ticked up $2 million.

Year to Date
Excluding proceeds from the Treasurer’s Investment
program, through the first third of the fiscal year,

-3-

 base general funds receipts have posted gains of
$1.420 billion. Those gains have been driven by
specific transfers [Refund Fund and Capital Projects],
stronger federal sources, court settlement proceeds,
and decent performance from the larger economically
related sources.

October court settlement proceeds. Gross corporate
income taxes have increased $51 million, or $49
million net. The performance of the remaining
revenue sources have been mixed, but have
experienced a combined $29 million decline.
Aided by gains associated to Refund Fund and Capital
Projects Fund transfers, overall transfers to the
general funds are up $511 million. Federal sources,
the beneficiary of comparatively strong recent
months, are now up $406 million.

Gross personal income taxes are ahead of last year by
$264 million, or $237 million net, while gross sales
taxes are up $87 million, or $115 million net. The
“Other Sources” category is ahead of last year by
$131 million, but that gain is entirely due to the

-4-

 OCTOBER
FY 2020 vs. FY 2019
($ million)

Revenue Sources

Oct.
FY 2020

Oct.
FY 2019

$
CHANGE

%
CHANGE

State Taxes
Personal Income Tax
Corporate Income Tax (regular)
Sales Taxes
Public Utility Taxes (regular)
Cigarette Tax
Liquor Gallonage Taxes
Vehicle Use Tax
Inheritance Tax
Insurance Taxes and Fees
Corporate Franchise Tax & Fees
Interest on State Funds & Investments
Cook County IGT
Other Sources
Subtotal

$1,607
98
743
77
23
13
1
22
9
22
18
0
220
$2,853

$1,612
84
736
65
24
13
3
41
6
20
9
0
43
$2,656

($5)
$14
$7
$12
($1)
$0
($2)
($19)
$3
$2
$9
$0
$177
$197

-0.3%
16.7%
1.0%
18.5%
-4.2%
0.0%
-66.7%
-46.3%
50.0%
10.0%
100.0%
N/A
411.6%
7.4%

Transfers
Lottery
Riverboat transfers & receipts
Proceeds from Sale of 10th license
Refund Fund transfer
Other
Total State Sources
Federal Sources
Total Federal & State Sources

46
21
0
0
37
$2,957
$250
$3,207

51
33
0
127
72
$2,939
$88
$3,027

($5)
($12)
$0
($127)
($35)
$18
$162
$180

-9.8%
-36.4%
N/A
N/A
-48.6%
0.6%
184.1%
5.9%

$4
($1)
$0
($1)
$27

-2.6%
7.7%
0.0%
20.0%
-60.0%

$209
($500)
$0
($291)

7.7%
N/A
N/A
-9.0%

Nongeneral Funds Distributions/Direct Receipts:
Refund Fund
Personal Income Tax
Corporate Income Tax
LGDF--Direct from PIT
LGDF--Direct from CIT
Downstate Pub/Trans--Direct from Sales
Subtotal General Funds
Treasurer's Investments
Interfund Borrowing
Total General Funds

($152)
($14)
($84)
($6)
($18)
$2,933
$0
$0
$2,933

($156)
(13)
(84)
(5)
(45)
$2,724
$500
$0
$3,224

CGFA SOURCE: Office of the Comptroller: Some totals may not equal, due to rounding

-5-

1-Nov-19

 GENERAL FUNDS RECEIPTS: YEAR TO DATE
FY 2020 vs. FY 2019
($ million)
$
CHANGE

%
CHANGE

Revenue Sources

FY 2020

FY 2019

State Taxes
Personal Income Tax
Corporate Income Tax (regular)
Sales Taxes
Public Utility Taxes (regular)
Cigarette Tax
Liquor Gallonage Taxes
Vehicle Use Tax
Inheritance Tax
Insurance Taxes and Fees
Corporate Franchise Tax & Fees
Interest on State Funds & Investments
Cook County IGT
Other Sources
Subtotal

$6,604
806
3,035
265
85
62
10
85
110
84
66
0
304
$11,516

$6,340
755
2,948
252
117
59
11
130
113
78
36
0
173
$11,012

$264
$51
$87
$13
($32)
$3
($1)
($45)
($3)
$6
$30
$0
$131
$504

4.2%
6.8%
3.0%
5.2%
-27.4%
5.1%
-9.1%
-34.6%
-2.7%
7.7%
83.3%
"N/A
75.7%
4.6%

Transfers
Lottery
Riverboat transfers & receipts
Proceeds from Sale of 10th license
Refund Fund transfer
Other
Total State Sources
Federal Sources
Total Federal & State Sources

174
96
0
617
505
$12,908
$1,112
$14,020

207
107
0
327
240
$11,893
$706
$12,599

($33)
($11)
$0
$290
$265
$1,015
$406
$1,421

-15.9%
-10.3%
N/A
88.7%
110.4%
8.5%
57.5%
11.3%

($13)
$2
($14)
($4)
$28

2.1%
-1.7%
4.2%
9.8%
-27.7%

$1,420
($300)
$0
$1,120

12.5%
-42.9%
N/A
9.3%

Nongeneral Funds Distributions/Direct Receipts:
Refund Fund
Personal Income Tax
Corporate Income Tax
LGDF--Direct from PIT
LGDF--Direct from CIT
Downstate Pub/Trans--Direct from Sales
Subtotal General Funds
Treasurer's Investments
Interfund Borrowing
Total General Funds

($628)
($115)
($344)
($45)
($73)
$12,815
$400
$0
$13,215

($615)
(117)
(330)
(41)
(101)
$11,395
$700
$0
$12,095

CGFA SOURCE: Office of the Comptroller: Some totals may not equal, due to rounding

-6-

1-Nov-19