SPRINGFIELD – As the Illinois Senate Democratic Caucus’ budget negotiators began conversations surrounding the plan for the upcoming fiscal year, one major item stood out – the sizeable surplus and the need to give back to Illinoisans who endured two years of financial strain.

The final budget – and the subsequent tax relief plan – prioritized working families, single parents and vulnerable communities. Illinoisans will begin to see relief as early as July 1, following Governor JB Pritzker’s Tuesday signing of the proposals. 

"We are continuing our practice of responsible budgeting while helping those who need help the most," said Senate President Don Harmon (D-Oak Park). "Families are struggling, and I hope this budget provides them a bit of relief."

To give consumers an economic boost for back-to-school shopping, Senate Bill 157 – signed Tuesday – includes a state sales tax reduction on clothing, shoes and school supplies for 10 days in August. The sales tax would be lowered to 1.25% from 6.25% from Aug. 5 to Aug. 14.

The majority of Illinoisans – more than 95% of taxpayers – will receive a one-time tax refund by the fall of 2022. Individual filers will receive $50 and joint filers will receive $100, with an additional $100 for up to three dependents. It also provides up to $300 in property tax relief for homeowners.

"This new law puts money back in the pockets of homeowners and families in the South Suburbs," said Senator Michael E. Hastings (D-Frankfort), sponsor of SB 157. "We are slowly recovering from the most severe public health crisis that our state, country and the world has seen in the last century. It is crucial that we prioritize families by providing them with much-needed and deserved relief to ensure Illinois' economy keeps growing."

The plan also addresses inflation by suspending the 1% state grocery tax for one year and suspends the state’s portion of the gas tax increase for six months to help with rising prices at the pump.

"With inflation creating more economic challenges for hardworking families nationwide, Illinois has delivered a responsible budget plan to offer relief, make smart investments and provide economic stability," said Senator Bill Cunningham, a Democrat who represents portions of Chicago and the Southwest Suburbs. "By putting money back in residents' pockets, our state is making an effort to support families with inflation-related burdens, create opportunity and set money aside for a rainy day."

Aside from the tax relief plan, Illinois Senate Democrats were able to continue to set the state on a path toward fiscal responsibility through the Fiscal Year 23 budget by making an additional $500 million pension payment and putting $1 billion in the state’s Rainy Day Fund.

The budget also considers the struggle many families face when considering sending their children off to college. It increases funding for the Monetary Award Program by $122 million to $601.6 million. This investment will make need-based financial aid available to at least 24,000 more students and increase the maximum grant award to $8,508 – which is nearly half a year’s worth of tuition at a state university. Under this plan, MAP funding will have increased 50% over the last four years.

To address the rising rate of crime and the need for greater public safety initiatives, the budget invests millions to support public safety measures, invests in the tools law enforcement needs to prevent and solve crimes and strengthens investments in violence prevent programs that keep communities safe. 

"This is one of the best budgets that we have seen in years," said Senator Elgie R. Sims, Jr. (D-Chicago). "As the Senate Appropriations Committee chairman, I set a mandate for our budget to solve the pressing economic problems facing low- and middle-income families. Because of our responsible fiscal approach, our state has generated the largest surplus in more than two decades and builds on the financial stability that we have seen over the past few years.”

The Fiscal Year 23 budget and tax relief plan was signed Tuesday and will take effect July 1, 2022.