Quinn gives State of State address

SPRINGFIELD, Ill. (AP) -   SPRINGFIELD, Ill. (AP) - Gov. Pat Quinn used Wednesday's State
of the State address to call for ending an Illinois tax on natural
gas.
      The Democratic governor also proposed the creation of a new tax
credit for parents with children, which he said will save $100 a
year for the average family of four. And he called for expanding an
existing tax credit for companies that hire unemployed veterans.
      In his speech, Quinn also set a goal of higher education for 60
percent of adults by 2025.
      He said Illinois is a better place to do business today, despite
frequent complaints about taxes, regulations and other costs. By
overhauling workers' compensation, lowering unemployment insurance
costs and improving roads and bridges, the state has improved the
business climate, Quinn said.
      Quinn unveiled the tax cut proposals as part of what he called
"the Illinois Jobs Agenda for 2012." He said that ending the
natural gas utility tax would make Illinois the only one state
without one in the Midwest, and would help businesses and families
alike.
      "This tax is an unfair, regressive tax that is not based on the
ability to pay," Quinn said. "By abolishing it entirely, we can
provide targeted tax relief to both consumers and businesses.
Illinois will be the only state in the Midwest without a natural
gas utility tax on manufacturers, retailers and everyday
families."
      The Democratic governor indicated he'd focus on ways to create
more jobs in Illinois, even if it means some new spending at a time
of financial crisis.
      The governor declined to get into specific financial details
about his plans, saying the painful details on the state's bleak
finances will wait until he proposes a new budget on Feb. 22.
      Quinn did not address the income tax increase approved a year
ago, which critics say has been a burden on Illinois businesses.
      Quinn also took a swipe at other states by saying Illinois still
believes in the right of workers to organize. Indiana is on the
verge of passing a "right to work" law that bars unions from
requiring non-members to pay fees for representation.
      Quinn also introduced the idea of tax incentives to create jobs
for veterans. He proposed letting businesses reduce their income
tax bills by up to $5,000 if they hire an unemployed veteran. The
plan also calls for giving businesses a credit equal to 20 percent
of the wages they pay to a veteran, up to a maximum credit of
$5,000. Currently, Illinois offers a credit of 10 percent, up to a
maximum of $1,200.
      It wasn't clear how much the tax measures might cost the state,
but Quinn said some money must be spent to improve Illinois.
      "You can't just cut your way to a better budget. We have to
make cuts, there's no doubt about it," he said during an
appearance Tuesday. "We also have to build and grow our economy."
      Other state officials expressed skepticism. Illinois Democrats
took the painful step of raising income taxes a year ago and last
fall softened that blow with an array of breaks for businesses and
families. More tinkering with taxes raises questions for some.
      "We would be most interested in hearing how that could be paid
for, given our current fiscal condition," said Rikeesha Phelon,
spokeswoman for Senate President John Cullerton, D-Chicago.
      Rep. John Bradley, a Marion Democrat who chairs the House
Revenue Committee, expressed similar concerns. He said the focus
should be on broad tax reform instead of scattered new credits.
      Quinn called for the creation of a council of business leaders
to come up with a plan to double Illinois exports by 2014, the
administration said, confirming news first reported by Crain's
Chicago Business.
      Quinn's State of the State address follows a dire report earlier
this week that said Illinois' backlog of unpaid bills could nearly
quadruple - from $9.2 billion to $34.8 billion - over the next five
years unless officials take action. The Civic Federation's report
predicts pension and health costs will continue to climb while
revenues will drop when the state's temporary income tax increase
expires.
      The governor has said Illinois needs to control costs in the
Medicaid health care program. He also is talking of making
downstate schools and universities share in the cost of pensions
for their employees.
      Quinn's tax proposals aren't likely to carry high price tags.
      The Revenue Department said a smaller version of the
veteran-hiring credit has rarely been used. Only 95 taxpayers
claimed the credit, for a total cost to the state of $79,543, in
the most recent year for which data is available. That was 2008-09,
when the credit was 5 percent of wages, up to a maximum of $600,
the department said.
      To underline his interest in jobs, Quinn spent the day before
his speech discussing two startup companies that are receiving
money from a state venture capital fund that's part of a $78
million program called