CHICAGO — Illinois lawmakers ended a week-long veto session Thursday after passing a public safety pension reform measure and advancing a gaming expansion bill but without taking up a series of major bills aimed at tackling the state’s looming deficit.

Lame-duck lawmakers could still address a number of outstanding bills in early January when they reconvene briefly before a new General Assembly takes over Jan. 12.

Lawmakers delayed taking action on a $3.8 billion pension borrowing plan, a proposed income tax hike, and a plan to sell more than $200 million of revenue bonds to help finance renovations at the Chicago Cubs’ 96-year-old Wrigley Field ballpark.

Both chambers approved a police and fire pension reform measure despite hot opposition from Chicago. Top city officials, including Mayor Richard Daley, chief financial officer Gene Saffold, and City Council members, criticized the measure, warning it would cost the city up to $550 million annually and lead to the largest property tax increase in city history.

For Chicago, the main problem is a provision that would require it to make annual contributions to the public safety pensions based on an actuarial formula.

The city currently contributes to the funds based on a percentage of salary, which has typically fallen far short of the actuarial contribution.

“The reality is that this change would mean a property tax increase of at least $550 million for Chicago property taxpayers — or a nearly 60% increase,” Saffold said at a press conference Wednesday. “This would be a staggering blow to property taxpayers. This would, in fact, be the largest property tax increase in the city’s history.”

The measure would not take effect until 2015.

The Senate passed the measure 46 to 4 Thursday morning. Senate leaders later said they would likely revisit the issue in January, possibly crafting follow-up legislation to address Chicago’s concerns.

At the close of 2009, the city’s firefighters fund was 30% funded and the police fund was at 37%, according to a May 2010 report issued by a pension commission appointed by Daley.

The Senate late Wednesday passed a bill that would mark a major expansion of gambling across the state. The measure, sponsored by Sen. Terry Link, D-Waukegan, would authorize four new riverboat casinos across the state and one new land-based facility in Chicago. The measure also allows additional slot machines at horseracing tracks.

“We’ve got huge problems in the state of Illinois, so you don’t look at little things to fix it, you look at big things,” Link said from the Senate floor Wednesday evening as the chamber prepared to vote on the measure. “I haven’t seen any other creative ideas around here.”

The bill still faces hurdles before becoming law. It needs to gain approval from the House and from Gov. Pat Quinn, who has been cool to expanding gambling in the state.

The House Tuesday passed a measure green-lighting a $3.5 billion “clean coal” plant in the town of Taylorville.

The controversial project features a 602-megawatt coal-fired plant that its Nebraska-based developers, Tenaska Inc., have billed as the cleanest coal-fueled plant in the world. 

The financing plan remains somewhat unclear, but the developers have said that they have secured a $417 million federal tax credit and a $2.6 billion federal loan guarantee. The company has also floated the idea of tapping the tax-exempt market through the state’s clean-coal bond program administered by the Illinois Finance Authority. 

The Senate could take up the measure in January, officials said.

Illinois has pushed off $6 billion in bills and primarily relied on one-shots like this week’s $1.46 billion tobacco bond issue to manage through fiscal 2011, but a deficit of up to $15 billion looms in fiscal 2011. Already stung by a series of rating downgrades, the state’s credit could slide further if lawmakers do not take steps to chip away at the budget’s structural problems.

Moody’s Investors Service rates Illinois’ $25 billion of general obligation bonds A1 with a negative outlook. Fitch Ratings rates them A, with longer-term negative outlooks. Standard & Poor’s rates the state A-plus, but has it on short-term negative watch for downgrade.

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