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Wednesday, Aug 30, 2006

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- Posted by Rich Miller   Comments Off      

Question of the day

Wednesday, Aug 30, 2006

Are you planning to work on any campaigns this fall? If so, which one(s) and what will you be doing?

- Posted by Rich Miller   76 Comments      

Budget debate - Rauschenberger responds to Filan

Wednesday, Aug 30, 2006

Within hours of Judy Baar Topinka releasing her budget plan last week, Gov. Blagojevich’s budget director, John Filan, was claiming that Topinka’s proposal would produce $5.7 billion annual deficits.

So, I offered Topinka’s budget point person, Sen. Steve Rauschenberger, an opportunity to respond to Filan’s claims. This is Rauschenberger’s full response. All emphasis is in the original. Topinka’s original proposal is here, and Filan’s response is here. Both are pdf files.

Thank you for the opportunity to respond to John Filan’s release on Judy Baar Topinka’s Financial plan.

Let’s look at the numbers one at a time.

Under proposed new spending.

Education $2.05 billion. It appears Filan has taken Topinka’s cumulative increase of $8.2 billion and divided by four years. For complicated reasons, that method doesn’t accurately represent the average increased spending per year. In addition, our 8.2 billion figure included teacher pensions, which he appears to double count below.

School Construction Debt Service $270 million. This appears to be an attempt to assign a debt service figure to Judy’s $3 billion school construction plan. This would be close to the level where debt service tops out, so they have picked the highest year to place in his table. I believe this figure is a shade high, but in the neighborhood. If this represents a “top-out” debt service figure, it would be applicable to perhaps FY12 or FY13 when the six year program is in full swing.

Funding Pension System at 1995 Plan $627 million. This might be John Filan’s estimate of the FY08 increase in pension payments. If that is the assumption, then he is close for an All Funds (including Federally Funded, University Income Funded, etc. employees) figure. Judy’s financial plan is a GRF plan, and the first year GRF increase is closer to $520 million.

Rehiring State Employees $150 million. Judy’s plan calls for rehiring 400 prison guards over 4 years. The funding for that initiative tops out at $16 million in FY11 if you assume $40,000.00 per guard per year. Filan’s figure would represent $375,000.00 per guard per year.

Pay Raises for Merit Comp Employees $33 million. Judy’s plan is silent on this issue (maybe John is feeling guilty and suggesting it), but she does believe pay raises for merit comp employees are important, if affordable.

Energy Plan $60 million. No one I know has any idea where this figure comes from.

Higher Education $100 million. This represents the incremental increase in higher education funding in the first year, FY08.

Local Property Tax Reimbursement $1.2 Billion. This is the total that will be spent on property tax relief in FY09.

John Filan appears to add these cherry-picked numbers from different fiscal years, and adds them up to call them “New Spending”.

Under Budget Cuts he lists only:

Cutting Healthcare to “Kids and Seniors” ($725 million). He appears to have taken the $2.9 billion four year cumulative spending difference between Topinka’s Medicaid plan and Blagojevich’s Medicaid plan, and divided by four. Unfortunately, Medicaid math does not work this way and this number is useless.

Filan fails to acknowledge the other budget savings proposed by Topinka’s financial plan including the elimination of pork spending and clout contracts and politically connected jobs.

Under New Revenue Filan lists:

Chicago Casino ($850 one-time, $250 annual per year starting in Year 2). Perhaps $850 million one-time is a reasonable estimate of the auction value of a 3000 position Chicago license… but in Judy’s financial plan they used a conservative estimate of $650 million. For the record Judy’s plan DOES NOT budget one-time revenues for the operating budget. She specifically reserves this resource for one-time spending needs, therefore the number should not even be on Filan’s chart.

As to operating revenue, John Filan is apparently assuming that a 3000 position casino in the heart of Chicago will yield $250 million in gaming taxes. According to the estimate by the Commission on Government Forecasting and Accountability, the 1200 position riverboat in Elgin will generate almost $200 million this year. The financial plan’s estimate of $600 million per year is much closer to Mayor Daley’s own estimate of three years ago.

Additional positions at existing casinos $350 million. Filan’s own revenue estimates assume the 9 operating riverboat licenses will bring in $700 million this year. He seems to be arguing that allowing existing riverboats to expand up to 150% of there gaming positions (from 1200 to 3000) will yeild a revenue increase of just 50%… he is way to low.

Filan’s rebutal fails to acknowledge the new Federal revenue that would be realized by the implementation of the Medicaid Block Grant.

Under lost revenue as defined in Filan’s response.

Economic Development Plan (from Tax Credits) $1.5 Billion. No one I know (except perhaps John Filan) has any idea where this number comes from or what it ties to.

Restore Corporate Fees/Eliminate Chargebacks $408 million. Judy’s plan calls for the elimination of fund sweeps, but does not call for the elimination of Chargebacks. I do not know where he gets this number from.

Re-Open Corporate Loopholes $30 million. Topinka, I am sure would argue the characterization, but the number is close.

Lost Federal Revenue from Medicaid Cuts $775 million. Under Topinka’s financial plan, Medicaid is converted to a block grant. You cannot lose federal match under a block grant because the federal contribution is fixed and NOT subject to matching.

For fun, let’s assume that Filan missed the whole point on Judy’s Medicaid reform, how does he forecast a loss of $775 million in federal aid when he earlier asserted this same plan called for a $725 reduction in Medicaid spending?? If his number is right on the spending reduction of $725 million, the federal aid loss is 50% or $362.5 million; if his number on loss of federal aid is right at $775 million, the program spending must be reduced by $1.550 BILLION.

I realize John Filan was taking a vacation day when he worked up this response to Treasurer Topinka’s four year financial plan. I do not fault him for not completely understanding a rather complex series of financial documents developed over more than 10 weeks at first glance. I do believe he has a responsibility as both the Budget Director and as a Licensed Accountant to make every effort NOT to mislead people regardless of how rushed he is.

The response he has issued mixes permanent and one-time revenues, uses numbers from different fiscal years as if they can simply be summed. His response doesn’t document where any of his numbers come from. In short, I believe this response was designed to confuse the issues, not debate them. That is wrong for the Budget Director to do, wrong for an accountant to do. Using the cover of one’s official office to mislead the public and the press is wrong.

- State Senator Steve Rauschenberger

Director Filan’s office was e-mailed a copy of Rauschenberger’s statement yesterday afternoon and will be allowed an opportunity to respond here as early as tomorrow. I reserve the right to allow further responses.

- Posted by Rich Miller   49 Comments      

Immigrant boom in suburbs

Wednesday, Aug 30, 2006

These are amazing numbers.

The number of foreign-born U.S. citizens jumped by nearly 38 percent in the suburbs over the last five years — leaping almost 50 percent in DuPage County alone and doubling in Will and Grundy counties, according to an analysis of Census information by a pro-immigrant group.

Calling it “a fundamental sea change of where immigrant citizens are living,” the Illinois Coalition for Immigrant and Refugee Rights argues the changes have far-reaching political ramifications. […]

Most important politically is the rise in the number of immigrants who have become U.S. citizens, making them eligible to vote. In the last five years the number of naturalized citizens in Illinois rose 23.1 percent, to 736,161.

But the real growth has been in the suburbs.

While Chicago only experienced a 4 percent increase in naturalized citizens of voting age during the period, the suburbs saw a boom of 37.5 percent.

The 48.2 percent rise in DuPage County means that 14.4 percent of its voting age population are naturalized citizens. In Will and Grundy counties, the number of adult naturalized citizens doubled, making them 6.3 percent of the total voting age population.

Read the full report here, and read the full press release here.

- Posted by Rich Miller   8 Comments      

Ace in the hole

Wednesday, Aug 30, 2006

As I’ve said before, the governor desperately needs to win the Civil Service Commission case against Dawn DeFraties so he can claim that he’s been vindicated of allegations of patronage abuse and pin the whole blame on the whistleblower. Apparently, the guv had an ace in the hole.

Gov. Rod Blagojevich appointed his children’s baby sitter to a $21,507-a-year post on a panel that resolves state hiring disputes. […]

As a member of the Illinois Civil Service Commission, Bukraba soon could be asked to rule in a key case centering on accusations of political clout being used to fix hiring for state jobs.

Given the close relationship between Bukraba and the Blagojevich family, government watchdog groups question whether she might have a natural bias in favor of the Blagojevich administration.

“If I were appearing in front of the commission, yeah, I’d be concerned about her being on that panel deciding my fate,” said Jay Stewart, executive director of the Better Government Association. “(Bukraba) is not a stranger to the governor, some Democrat who had relevant experience, as those appointments are typically made.”

I think I read about this first in a comment posted here several days ago. I kinda sped by it and, stupid me, didn’t follow up.

- Posted by Rich Miller   29 Comments      

Divide and conquer

Wednesday, Aug 30, 2006

This leak…

Dorothy Brown, the clerk of the Cook County Circuit Court, intends to announce plans to run for mayor next year, according to a person close to her campaign committee.

Ms. Brown plans to announce her decision Thursday afternoon at the Hotel Allegro in downtown Chicago, months after forming an exploratory committee to eye a potential campaign for City Hall. The mayoral election is scheduled for February 2007.

…may have been caused by this

As for Dorothy Brown, Axelrod says she may be jumping in now because the word on the street is that Jesse Jackson Jr. is contemplating some type of announcement of his own in the next few days, and she wants to beat him to the punch.

…which undoubtedly triggered this leak…

Chicago Housing Authority Chief Terry Peterson is taking a leave of absence to run Mayor Daley’s re-election campaign in the first concrete sign that Daley intends to shake off recent corruption scandals and seek a sixth term, sources said Tuesday.

“Nobody’s heard him say it, but if you’re looking for tangibles, this is as good a sign as any,” said a Daley adviser, who asked to remain unnamed.

Meanwhile, there’s more division in the African-American community.

In an exclusive CBS 2 News report, CBS 2’s Mike Parker has learned that some leaders among the Democrats want Todd Stroger off the ballot for November and replaced by a stronger candidate to face Peraica.

“I’m going to win, and I don’t see any reason why I would want to bow out,” Stroger said.

But quietly, some Democrats have discovered that election law allows the candidate to refuse the nomination before Oct. 1. Party leaders would then select somebody else.

One possible alternative appears to be Interim Board President Bobbie Steele. In the wake of a patronage hiring flap, Steele issued an executive order Tuesday threatening to discipline anybody who hires, fires or promotes, based on politics.

- Posted by Rich Miller   12 Comments      

Guv turns down tollway sale again, but it’s a whole lot of cash

Wednesday, Aug 30, 2006

The governor said once again that he doesn’t want to sell or lease the tollway.

“We’re not going to sell the tollway. I’m not interested in that, for several reasons. We’ve done a lot of great things at the tollway to help commuters get to where they want to go faster. One of the problems with privatizing the tollway is the private companies whose motivation is to raise profits. They’re apt to raise tolls, and they may be less interested in maintaining the infrastructure,” said Blagojevich, a Democrat in his first term.

The governor said he doesn’t believe there’s enough support in the Legislature to pass a tollway privatization bill.

But some legislators who were briefed yesterday came away drooling at the possible $24 billion windfall.

Supporters of leasing out the tollway downplayed Tuesday the potential impact of related toll hikes as several suburban leaders appeared increasingly skeptical of the idea.

Yet, the prospect of raking in as much as $24 billion from the lease so intrigued lawmakers of all stripes during a hearing in Glen Ellyn that none would rule out such a sweeping deal.

“This is a unique opportunity,” said Republican DuPage County Chairman Robert Schillerstrom, who listed several caveats to leasing the tollway, before concluding, “I do not believe we should close the door.”

Steve Rauschenberger wasn’t impressed.

“You buy four or six years of political peace with that,” he said.

And some of the tax-eaters have already said what they want if the tollway is ever sold.

Schoenberg got an earful a week ago from AFSCME Illinois Council 31, Business Leaders for Transportation in the Chicago area, the Mid-West Truckers Association, the Transportation for Illinois Coalition, and the Laborers International Union of North America Midwest Region. Each offered wish lists for safeguarding wages, benefits, retirement and training of current tollway employees. They also urged caution in deciding how the extra state revenue would be spent.

- Posted by Rich Miller   7 Comments      

Morning shorts

Wednesday, Aug 30, 2006

· Illinois students improve in math, fall in verbal scores

· Poverty rises in Illinois, holds steady nationwide

· “[T]he handsome and flamboyant Illinois Governor Rod Blagojevich proved that he could outshine any Bollywood star with his crowd catching demeanor and easy mingling with the people. He won everybody’s heart and induced other Parade Marshals like Dorothy Brown to emulate his example and mix with the crowd. “

· Editorial: Slow down search for state school chief

· Topinka discusses funding for reading during daycare stop

· Topinka’s new robocall

· State retirees work to keep taxes at bay

· Editorial: The imperfections of man

· I pre-ordered the new Dylan album, and I agree with most everything in this review.

- Posted by Rich Miller   7 Comments      

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