* Budgetary cluelessness…
On what could be the final legislative day until November, Gov. Quinn’s bid to borrow $3.7 billion to pay for state pensions stalled in the Senate, where GOP gubernatorial nominee Bill Brady and fellow Republicans withheld support.
“We’ve been able to stave off more pension borrowing on the backs of our children and grandchildren,” said Brady, of Bloomington.
The governor proposed borrowing for the pension payment over 8 years. That’s hardly an intergenerational debt. However, skipping the pension payment will cost tens of billions of dollars due to lost interest on investments over the next few decades. That truly is intergenerational, and that’s what Brady and his fellows just caused, unless the Senate can find the votes for the borrowing plan. From Kate Grossman, a Sun-Times editorial page editor…
Skipping a pension payment costs much more than borrowing. If the state skips, it could lose at least $20 billion in investment income over 20 years. Borrowing $3.7 billion now would cost about $1 billion.
We urge the Republicans and the two wayward Democrats who don’t support pension borrowing to mull over this simple math for the next two weeks.
* Political cluelessness…
[Democratic Sen. Heather Steans] said she may be able to support a smaller borrowing effort if it was part of a budget package that also included more spending cuts and a way to raise revenue, such as an income tax increase.
Yeah. An income tax hike in a year like this. That’ll happen.
* Logrolling isn’t illegal, but it doesn’t appear to have happened on the pension borrowing proposal in the Senate…
[Senate Republican Leader Christine Radogno] also said the Quinn administration approached Republicans with “promises of facilities or perks or money for their districts in exchange for votes. It’s unsavory at best or illegal.”
Sen. Larry Bomke, R-Springfield, said previously he had been contacted by Quinn about supporting the borrowing plan. He said nothing was offered.
“No, and I didn’t ask for anything,” Bomke said. “He just asked if I would vote for it. I said, `Governor, why do you need me? You’ve got 37 (Democratic senate) votes.”’
Notice that Bomke didn’t say he was opposed to borrowing, just that the Democrats should do it on their own. The State Journal-Register is fed up with this attitude…
Their political party before their state. Their Republican colleagues before their constituents. The leader of their caucus before the taxpayers.
Those were the choices state Reps. Raymond Poe, R-Springfield, and Rich Brauer, R-Petersburg, made on Tuesday night. Poe and Brauer voted against a plan to borrow $3.7 billion to make the state’s full payment, on time, to the pension systems.
And the Pantagraph makes a good point…
Consider Tuesday’s vote on a borrowing plan.
Two Republicans were said to have “broken ranks” because they voted with the Democratic majority to approve the proposal.
Republican state party chairman Pat Brady almost seemed more concerned that Rep. Bob Biggins, R-Elmhurst, missed a Republican caucus meeting than the fact that Biggins was one of only two Republicans who voted for the borrowing plan. State Rep. Bill Black, R-Danville, was the other.
Does anyone think it was a coincidence that the two Republicans who voted in favor of the plan aren’t up for re-election?
* This is what will happen now…
“Without the borrowing to make the pension payment, the pension payments get in line with everybody else,” Madigan said. “They become a matter for the governor and the comptroller in terms of managing the cash-flow.”
Also, the governor received some extraordinary powers from the General Assembly this week…
But other options may exist. Part of the emergency budget powers granted to Quinn allow him to tap surpluses in special state accounts to cover state spending, though the money must be paid back within 18 months with 1 percent interest.
Quinn already proposed borrowing $1 billion from those accounts, but lawmakers didn’t limit how much he could take so long as it doesn’t impede the cause or effort for which the account was created. The Senate’s budget pointman said upward of $3 billion might be available for the governor’s use.
A few budget highlights…
*Borrow $1.2 billion against future tobacco settlement proceeds.
*Allow Gov. Pat Quinn to hold up to $2 billion of state spending in reserve.
*Allow Quinn to borrow money from restricted state funds.
*Give state until Dec. 31, instead of Aug. 31, to pay bills left over from this year.
*Eliminate cost-of-living pay increases for state lawmakers next year.
*Cut daily expense money for lawmakers from $139 to $111 next year.
*Cut mileage rate paid to lawmakers from 50 cents to 39 cents.
* Borrowing out; $6.6 billion deficit still in for Illinois budget
* Madigan: Lawmakers Won’t Return to Springfield Yet: The House approved — but the Senate would not consider — a bill to borrow the money to make pension payments. Madigan says an “emergency budget act” gives Gov. Pat Quinn enough latitude to try to make things work. “We acknowledge that we’re running a deficit, like 47 other states,” says Madigan. “Gov. Quinn is entitled to extraordinary budget powers, the ability to borrow from other funds.”
* Kadner: Miller says his vote just the ‘Right Thing’