By Ashley Badgley Illinois Statehouse News

SPRINGFIELD — Don’t expect Gov. Pat Quinn’s 2011 budget to play well in Peoria – or any other Illinois town.

State officials on Tuesday outlined a preview of Quinn’s proposal to plug the nearly $13 billion deficit with $2 billion in cuts and $11 million in short-term borrowing. No income tax increase is included in the spending plan.

However, the governor is asking municipalities across the state to give up $300 million in income tax revenue to help balance the budget.

Quinn’s chief-of-staff Jerry Stermer said the shared sacrifice is necessary during these tight financial times. He would not comment when asked if an income tax increase would surface later.

“Because of the fiscal crisis, we’re calling for a suspension of the current rate of 10 percent of income tax going to local governments to change to 7 percent,” Stermer said. “That would yield about $300 million in budget savings.”

But a sampling of mayors across the state shows opposition to the proposal.

Mayor Robert Butler from the downstate community of Marion said local governments across Illinois are suffering with their own fiscal problems. Residents expect services from their communities, and the loss of revenue would practically cripple those services.

“It’s like chopping a person’s legs off at the knees,” Butler said. “You have vital services, necessary services, that the municipality must provide and if the state comes in and takes away your money, how are [municipalities] going to provide it?”

Butler said Marion is “limping along” financially and that the state needs to look somewhere else for revenue. He said he supports a temporary tax increase for the state to regain its financial balance – and to save Marion from taking drastic steps.

“If our profits begin to dry up from what we should expect to get from the state, [we] have to cut costs,” Butler said. “One of the places you have available to cut costs is…workers, employees, labor.”

Moline Mayor Don Welvaert said he just heard of the state’s plan Monday and said his community would lose $1.1 million.

Losing that much revenue would be the last blow to the city that last year laid off 23 employees and increased both food and liquor taxes, he said. Additionally, city employees have to take four unpaid furlough days in 2010 through the beginning of 2011.

“A lot of the problems that the state of Illinois is in right now is because of their own decisions,” Welvaert said. “And it’s sad that they feel they have to reach out to municipalities to help them get out of this mess.”

Welvaert said the state should eliminate programs such as free rides for seniors and legislative tuition waivers to help bridge the budget deficit gap and avoid already struggling communities.

He said the most effective way to garner revenue focuses on pension reform across the state.

“Probably the single most helpful thing that the state of Illinois could do is to address pension reform,” Welvaert said. “Pensions in the state of Illinois are draining municipalities and the State of Illinois of their revenues at an alarming rate.”

And it’s not just state-funded public employee pensions, he said. Welvaert said that 38 percent of Moline’s payroll goes toward pension payments for city employees.

However, downstate Sen. Gary Forby, D-Benton, said he hopes municipalities will understand the state’s budget problems and make the necessary cuts to help solve the nearly $13 billion deficit.

“I think [municipalities] are going to step up to the plate and try to take some cuts,” Forby said. “I’ve talked to community colleges around and they say they are cutting costs some. They just don’t know how much yet because nobody has seen the budget and what the government is going to put out there.”

Quinn will formally announce his budget, titled “Fighting for Illinois,” on Wednesday.