Senate lawmakers used their time in Springfield last week to override an amendatory veto of McPier reform legislation, approve a controversial STAR bond measure, advance tax amnesty legislation and budget bills, but did not consider a measure to borrow $4 billion that would be used to finance the state’s pension obligations.

The planned state budget—contained in House Bill 859 and SB 1215—has been sent to the governor. The measures will increase state spending by $1 billion over the previous year, spending about $6 billion more than the state will take in. In addition, more than $6 billion in bills from the current fiscal year will be left unpaid. No Republicans supported the deficit budget.

Another bill, Senate Bill 3660, would give Gov. Pat Quinn more discretionary authority on how to spend state revenue. Proponents claim it could result in as much as $300 million in savings, but others are skeptical, pointing out that Quinn promised to shave $1 billion from spending last year, but failed to do so.

The legislation would also allow the state to take out a loan against money it is slated to receive from a national tobacco settlement, which could produce $1.2 billion. That move is controversial because the state already uses money from the tobacco settlement to fund other state programs.

Additionally, SB 3660 allows Quinn to divert money—about $1 billion—from restricted state funds. The Blagojevich administration often swept state funds to subsidize general state spending. Though the legislation mandates the money be replaced with interest, some lawmakers are skeptical it will be repaid.

Though the budget measures were advanced, a key component of Quinn’s budget agenda was not called for a vote in the Senate. The legislation, Senate Bill 3514, would allow Quinn to sell up to $4.1 billion in general obligation bonds to finance payment to Illinois’ five state retirement systems. Though the measure narrowly passed the House, not enough Senate lawmakers supported the measure so no vote was taken.

Senate Republicans opposed the proposal, noting that the pension bonding scheme is worse than previous bonding plans approved in 2009 and 2003. The payments on Quinn’s 2010 borrowing measure are heavily “back-loaded,” meaning that none of the debt would be paid down for the next three years. In 2009, the borrowing was “front-loaded” so payments would decrease over time, becoming more affordable with each passing year.

As a result, over the course of the loan taxpayers would pay $1 billion in interest charges alone. Annual payments would skyrocket from $125 million to $1 billion in just eight years. In comparison, the 2003 Blagojevich plan would reach the same $1 billion in annual payments in 30 years that Quinn’s plan reaches in eight years.

While Senate Bill 3514 did not advance, lawmakers did overwhelmingly reject changes the governor made to the bipartisan McPier reform package. Senate Bill 28 seeks to ensure that the Metropolitan Pier and Exposition Authority (McPier) and its convention facilities continue as an economic engine for the state.

The legislation was introduced this spring after several lucrative trade shows left Illinois for more desirable locations. Additional shows threatened to leave Chicago if steps weren’t taken to address exhibitor complaints relating to the high cost of doing business at McPier.

After months of public hearings and discussions with stakeholders, the General Assembly passed the reform package to ease stringent labor rules and costs associated with exhibiting at McPier. Although the governor’s amendatory veto was overridden by lawmakers, a number of Quinn’s concerns about the legislation were advanced in followup legislation (Senate Bill 3215) that was approved by lawmakers on Thursday.

Some additional measures approved by the Senate on Thursday include:

Sales Tax Holiday (SB 3658): Established an annual sales tax holiday for clothing and school supplies. The holiday will begin on Aug. 6, 2010 and extend through Aug. 15.

STAR Bonds (SB 2093): Created a sales tax and revenue (STAR) bond that is intended to spur development and job creation in Marion, Illinois, by giving the sales tax revenue to developers to finance large destination and entertainment businesses. Though the measure is expected to stimulate much-needed development in the Marion area, other southern Illinois communities strongly opposed the legislation. Opponents argued that the bill is devastating for their regions, as developers will be naturally drawn to expand in Marion because of the associated revenue benefits.

Tax Amnesty (SB 377): Expected to raise $250 million by establishing a tax amnesty period. The measure abates all interest and penalties that were incurred between June 30, 2002, and July 1, 2010, on unpaid taxes. Though some lawmakers were hesitant to advance the legislation, which some believe “rewards” people who failed to pay their taxes, ultimately the measure was overwhelmingly approved by the Senate. A 2003 tax amnesty initiative brought in $500 million.

Video Gambling (SB 744): Followed up legislation relating to last year’s expansion of video gaming that was included in last year’s capital plan. The measure allows restaurants and bars that are attached to off-track-betting locations to have video gambling machines.