Gov. J.B. Pritzker’s fiscal 2021 budget, released in February, called for a total cost of $42 billion. The report, released today, estimates a $1.9 billion reduction in state revenue in 2020 as the best-case scenario. If the recession that’s underway mimics the Great Recession of 2008-09, the decrease will be more like $3.2 billion. The worst-case scenario projects a $6.4 billion hit—just in this calendar year.

A recession mirroring the Great Recession is the second-best outcome the task force gloomily foresees. In that case, the four-year hit to the state’s treasury would be nearly $13 billion. A “moderate severity” pandemic would reduce revenues by $17.6 billion over the period. A “severe” scenario would blow a $28 billion hole over those four years.

The big three sources of revenue for the state are corporate income taxes, individual income taxes and sales taxes. All will see reductions due to the loss of business activity and the unprecedented spike in joblessness.

Adding to the fiscal nightmare for the state is that demands on its resources will increase significantly. In particular, Medicaid expenditures for the increasing number of Illinoisans who fall ill and also lose health coverage will make matters worse—and potentially a lot worse than in the Great Recession, the report said.

Between 2007 and 2009, Medicaid costs for the state increased $2.5 billion, the report said. Those costs easily could rise up to double that amount over the next few years.

"The COVID-19 emergency is likely to be quite different from past recessions because we expect a substantial number of households with precarious economic circumstances to be pushed onto Medicaid as they become infected with coronavirus,” the report reads. “This will be likely to compound the usual recession-induced influx of Medicaid eligible households, greatly amplifying the need for Medicaid expenditures.”

Another factor: the ever-present problem of underfunded pensions. The state’s pension plans in the aggregate fell from a funded status of 63 percent in fiscal 2007 to 39 percent in fiscal 2013, due to substantial asset losses. Since that time, the funded ratio has hovered around 40 percent, the report said.

Given the emergency, the state may not increase pension contributions immediately to compensate for the blow. But “increased pension contributions by the state are a potential future impact that should not be dismissed,” the report said.

The stimulus measures enacted by the federal government thus far have provided $4.9 billion to Illinois, of which the state government will take $2.7 billion. The remainder presumably will be spread among equally hard-hit municipal governments like the city of Chicago. Other assistance in the form of a higher Medicaid matching formula, greater emergency food assistance grants and other measures will help, too.

But not nearly enough.

“While these pieces of federal legislation are expected to cushion the state of Illinois’ fiscal burden as a result of the pandemic, our analyses suggest that the combined effect of the federal measures enacted to date are likely to be vastly inadequate,” the report said. “It is too early to precisely quantify the fiscal gap that is likely to be created by reductions in state revenue and increases in the cost of delivering state services, but we believe that it will almost certainly cost billions of dollars and possibly tens of billions of dollars.”