SPRINGFIELD — One year ago, Democratic Gov. JB Pritzker used his annual State of the State and budget address as a national platform to warn Illinoisans about President Donald Trump’s threats to democracy, likening Trump’s leadership to that of Nazi-era Germany.

On the eve of his next statewide address in an election year where both he and Democrats hope to retake Congress, Pritzker is expected to deliver a speech shaped as much by political crosscurrents as by fiscal math. It will likely present a more optimistic picture of Illinois’ finances than last fall’s estimate that the state faces a $2.2 billion budget gap. It’ll also almost assuredly feature the governor doubling down on Trump, saying the Republican president’s first year of his second term only proved his predictions were accurate.

The governor himself hinted at the latter theme for the speech, scheduled for Wednesday before a packed Illinois House chamber, as he unveiled a new Substack with an inaugural blog post titled, “The State of Illinois is Being Loud for America: A Year of Confronting Donald Trump.”

“After I delivered the speech (last year), some people said I was being unfair or alarmist. One year later, it’s clear it really is a five-alarm fire. I still stand by every word,” the governor wrote. “Donald Trump deals in intimidation, but we aren’t afraid … Illinoisans love this nation too much to let MAGA tear down our constitutional republic.”

While Pritzker’s expected rhetoric about Trump will undoubtedly be embraced by the Democratic supermajorities that make up both the state House and Senate, the governor also faces intensifying pressure from his party’s left flank on the budget portion of his speech, as progressives are pushing for the wealthy to pay more.

Pritzker, seeking a third term and widely viewed as a potential 2028 presidential contender, has generally pushed back against launching a new round of tax ideas and even reminded a progressive Chicago alderman who confronted him last year that he had pushed in 2020 for a graduated income tax plan, which failed. Still, the governor will be forced to navigate demands from some lawmakers — including public support from the Democratic speaker of the Illinois House for reviving a graduated “millionaire’s tax” — and from Chicago Mayor Brandon Johnson, who is expected to press the state again for additional help for the city’s strained finances.

The state’s estimated $2.2 billion gap, likely to be revised, isn’t as dire as it was at this point last year. But it’s still alarming enough for the governor’s office to implement contingency plans in anticipation of possible drastic cuts in federal funding for education, health care and other areas. Despite fiscal responsibility being a cornerstone of Pritzker’s political identity, the state’s $55 billion operating budget has grown by more than 40% since he became governor in 2019, though the increase equates to 11% when adjusted for recent high inflation.

The more immediate uncertainty stems from Washington, D.C.

A February report from Moody’s Analytics prepared for the legislature’s bipartisan Commission on Government Forecasting and Accountability found that Illinois’ economy weakened in the second half of 2025 and is projected to lag the Midwest and the nation in the year ahead. The report cited economic challenges, including “below-average population trends,” “deep-rooted fiscal problems such as mounting pension obligations” and a “shrinking tax base,” but also warned Trump’s policies would act as “a net drag” on growth.

Trump’s tariff policy is also a concern for Illinois, as the state’s sizable manufacturing sector is particularly exposed to tariffs that raise costs for imported components used in farm equipment and technology production, the report said.

Pritzker’s budget office has warned that federal changes to Medicaid and the Supplemental Nutrition Assistance Program, stemming from Trump’s sweeping tax-cut-and-spending law from last year, could cause hundreds of thousands of Illinois residents to lose those benefits.

An analysis disclosed earlier this month projected that between fiscal years 2028 and 2031, the cumulative loss of federal Medicaid support would exceed $6 billion. And in the fall, state officials predicted Trump’s measures would reduce revenue in the current state budget by about $830 million compared with the revenue forecast when the budget was passed in late May. In December, Pritzker signed a measure that “decouples” the state from federal tax policy changes, softening the impact of Trump’s moves on Illinois and limiting revenue loss by about $243 million to an estimated $587 million.

“The most vulnerable states include those with a high poverty rate and those that offer more generous Medicaid benefits,” the Moody’s report said in reference to Trump’s fiscal moves last year. “Though federal healthcare spending will decline in every state, the bill will lead to an above-average drop in Illinois.”

Paula Worthington, a senior policy adviser at the Civic Federation specializing in government finance, said Illinois has only so much wiggle room if federal support recedes.

“It’s a little bit of an all-hands-on-deck sort of way of thinking about it,” said Worthington, who is also a collaborating scholar at the University of Illinois. “That really does point to limited flexibility for the state, trying to be conservative, trying to prepare as best we can for the shocks that we already see are in motion, and then the ones that may still be coming.”

Pritzker’s other budget pressures include mandated increases in K-12 school funding, as advocates push for greater financial attention to schools in low-income neighborhoods, and billions in pension payment obligations. While the state saw moderate overall revenue growth at the end of 2025, it remains unclear whether that will be enough to avoid tax hikes.

Republicans, who remain firmly in the General Assembly’s minority, say that in response to the issues facing the state, the governor should hold spending flat, pledge not to implement new taxes and tighten oversight of existing programs.

State Sen. Seth Lewis, a Republican budget point person, said he hopes to see no new programs and a focus on core services, including support for residents with developmental disabilities. He also criticized a recently enacted clean energy law backed by Democrats, arguing it would increase utility surcharges.

“I understand the clean energy folks, and solar and wind is going to be our savior, and that may be true 30 years from now,” Lewis, of Bartlett, said. “But we need to get more power on the grid now.”

Using Pritzker’s proposal from Wednesday as a baseline, the General Assembly will be tasked with negotiating a final budget by the end of May. Its Democratic leaders have stressed that cost-of-living issues are their focus, mirroring a broader national Democratic strategy ahead of the November midterms that seeks to blame rising prices from groceries to medicine squarely on Trump and congressional Republicans.

“Once the governor’s budget is out there, now you know what every proposal (is) that has a fiscal impact, how it will play out,” said state Sen. Elgie Sims Jr., a Democrat from Chicago and the Senate Democrats’ chief budget negotiator. “I think you’ll hear the discussion, at least from our caucus, about making sure that life is more affordable for people across the state of Illinois. We want to make sure that they have what they need to be successful.”

Yet some Democrats are pushing Pritzker to go further.

Progressive lawmakers have revived calls for a more aggressive overhaul of the tax system, including proposals to tax billionaire asset appreciation, levy a 10% tax on digital advertising revenue from large technology companies, prevent multinational corporations from shifting profits to tax havens and close certain corporate loopholes. Even House Speaker Emanuel “Chris” Welch, a Democrat from Hillside, has publicly expressed openness in raising revenue through a tax on millionaires.

“The economy, it’s not going to keep working if we give all of our money away to the rich. That’s not our labor force. That’s not our resources. So the way to have a strong economy is putting these dollars back into our community that make a strong economy to attract more businesses to come to Illinois,” said state Sen. Rachel Ventura, a Democrat from Joliet. “The question shouldn’t be, ‘Oh, how do we tax the rich and have them not leave?’ How do we support our people so we have a strong economy that’s sustainable and can continue to make Illinois the best state it can be?”

Ventura is part of a diverse group of some 40 state lawmakers called the Affordability and Tax Justice Coalition, whose goal is to fix Illinois’ tax system to help working- and middle-class Illinoisans and encourage greater revenue stability at a time when the Trump administration is threatening massive funding cuts to the state.

“We support efficiencies and cost savings to achieve our budget goals and we know that we cannot simply cut our way out of this crisis,” the group said in a statement. “Although many legislators focus on the budget and revenue in March, April and May, we are committed to the year-round work that transformational change and protection against federal devastation calls for.”

Public school advocates are also pressing for larger increases to the state’s evidence-based funding formula, also known as EBF, which prioritizes money to low-income districts. While the Pritzker administration has mostly only pushed for the mandatory $350 million annual increase, some lawmakers say that hasn’t been enough.

“If we’re ever going to get to a point where we are, quote-unquote, fully funded, we know that that amount needs to go up considerably,” state Rep. Will Davis, a Democrat from Homewood who sponsored the EBF law in 2017, said during a Chicago news conference last week. “We’ve talked about as much as $550 million. The reality is that it’s probably in upwards of $1 billion that’s needed to get us to fully funding schools here in the state of Illinois, and it has to be continuous money.”

With legislative Democrats compiling their spending wish list for the next budget, which takes effect July 1, questions remain about how to solve Illinois’ pension quagmire, where growing unfunded pension liabilities now total about $144 billion.

Earlier this month, the governor said he wants to address the issue and introduced proposals, including resurrecting a 2024 plan that called for increasing the funding target to 100% from 90%, and extending the deadline by three years to 2048 from 2045, even though the plan essentially received no public consideration two years ago.

In a statement, Democratic Senate President Don Harmon of Oak Park said he supports the proposal as “a sound policy idea” but was noncommittal about pushing for it this year if there are too many budgetary constraints.

In recent weeks, the Pritzker administration said it had identified nearly $500 million in potential reserves after asking agencies to hold back 4% of their budgets amid news that the Trump administration ordered a broad review of federal funding to Illinois and about a dozen other Democratic-controlled states. Revenues through the first seven months of the fiscal year are up 3.5% compared with last year, according to the legislative forecasting commission, though federal receipts have declined for three consecutive months.

“This is a problem where we have an administration in Washington that’s putting an extraordinary burden on states,” said Sims. “We’ll make the tough decisions that the federal government won’t, we’ll make the responsible decisions that the federal government hasn’t.”