* As I told subscribers this morning, there’s just no good budgetary news today…
Newly fiscally conservative Democrats in the Illinois House unveiled numbers Thursday they say will limit state spending. Lawmakers said they will base the next state budget on $33.2 billion in state revenue. […]
Quinn’s budget office came up with a $33.9 billion number. The differences stem from varied estimates as to how much Illinois will get from the new personal and corporate income tax increase passed in January. COGFA is guessing $2.1 billion. Quinn’s budget office is guessing $1.8 billion.
The governor’s spending plan comes with a price tag of more than $35 billion.
Notice the difference between the governor’s proposed spending and the House’s new revenue projections. About $2 billion.
More…
The plan, though, is for Bradley and other Revenue Committee members to talk to appropriations committee chairs to determine how much money each will have to allocate. Those committees deal with broad areas of government, such as elementary and secondary education, higher education, human services, public safety and general services.
“We will allocate as fairly as possible,” Bradley said. […]
The House is also only half the equation. The state budget must be approved by the Senate as well, and the Senate is taking its own approach to the budget.
“The Senate president is aware of the House’s approach, but the Senate Democratic caucus will not rely on House projections,” said Rikeesha Phelon, spokeswoman for Senate President John Cullerton, D-Chicago. “We will do our own evaluations while analyzing (various revenue estimates).”
* And then there’s the pension problem…
The financial hole in Illinois’ government pension systems grew even larger last year, the state auditor reported Thursday — a problem that tends to increase pressure on a state budget already stretched too far.
The long-term gap between what Illinois owes future retirees and the money available to pay them jumped 21 percent under a new measuring system, Auditor General William Holland reported. Even under the old system, the gap grew by 10 percent.
Illinois government employees, downstate teachers and university staff have been promised $139 billion worth of retirement benefits, but the pension systems have only $63 billion in assets. Eventually, the state will have to come up with money to make up that difference. […]
The amount owed [for pensions] in the next budget will top $5.4 billion, the auditor said. That’s part of the massive budget deficit haunting Illinois.
* Regardless of the hole, some people are very worried about the cuts already on the table…
More than two dozen seniors and advocates from local social service agencies gathered Thursday at the Decatur-Macon County Senior Center to protest the cuts to senior services in Gov. Pat Quinn’s proposed budget.
The budget calls for the elimination of the Circuit Breaker and Illinois Cares Rx programs, which assist low-income seniors and people with disabilities. Among the benefits of the programs are access to transportation and help paying for prescription drugs and property taxes. […]
“Please don’t balance the budget on the backs of low-income seniors,” Groendal said, adding that some who rely on the programs could face hospitalization, life in a nursing home or even death without them.
She shared part of a letter she wrote to Quinn, including some possible alternatives to cutting the programs completely - part of her “tweak it, don’t take it” approach.
* Meanwhile, State Superintendent of Education Christopher Koch is saying that suburban schools won’t have to worry too much about Gov. Pat Quinn’s consolidation idea…
For any unit district, there wouldn’t be as high a need for consolidation,” Koch said. “But we do have an issue in some populated areas of a disconnect with some high schools and their feeder elementaries. The need for consolidation really depends on the region. And communities have to be engaged in that conversation.”
Gov. Pat Quinn pitched the elimination of about 600 school districts via consolidation in his budget address last month. The idea is to save $100 million by reducing unnecessary administrative costs.
But Koch said that may not be a realistic goal or even the best selling point for consolidation. Indeed, consolidation may not even be on the table when it comes to most suburban school districts, he said.
“It’s an issue of what kids have access to,” Koch said. “In some areas of the state it’s hard for kids to have access to an advanced placement course or a rigorous curriculum. We know that that’s going to make a huge difference for them in being successful in college and careers.”
* And, as expected, one consolidation proposal was at least temporarily shelved while others are not being rushed…
Backlash over one plan reportedly has caused its sponsor to change his mind on the bill, which was scheduled for discussion in a committee meeting Thursday morning. That bill, sponsored by state Rep. Robert Rita (D-Blue Island), would have dissolved all school districts in the state, replacing them with one district per county, effective in July 2012.
Several other consolidation plans have been introduced in the state House and Senate this spring.
State Rep. Frank Mautino (D-Spring Valley) said it’s not likely any of those will be rushed through the General Assembly. The deadline to file bills passed last week, and committees have about three weeks to review bills.
More on that county school consolidation idea…
State Rep. Richard Morthland, R-Moline, has received more than 200 e-mails from school officials voicing their concern.
“I’ve heard from superintendents and school board members across the state, literally, everywhere in the state, because I am on the committee that was hearing this before it would go to the floor,” said Morthland, a member of the House Counties and Townships Committee.
* Related…
* IL Dept. of Insurance head McRaith on short-list for U.S. insurance czar: The Obama administration was expected soon to name an Illinois state insurance regulator to head the new Federal Insurance Office, sources familiar with the matter said on Thursday.
* Lawmakers to DHS: Provide better services with less money
* Taxes not enough, Republicans want schools to charge more for Drivers’ Ed
* Taxpayers can’t afford costly tuition waivers: For years, Illinois taxpayers have been subsidizing tuition waivers for students selected by legislators and the children of state university employees. Sen. Christine Radogno, R-Lemont, wants the practice to end. She’s right, and the Illinois General Assembly should follow her lead.
* Editorial: State can’t get fiscal house in order if its books remain muddled
* EIU president won’t predict tuition hikes
* Tribune Editorial: Collective solutions - Will public employee unions confront fiscal reality?
* Chris Christie: Collective Bargaining Something ‘I Love’
* Illinois moves to close troubled nursing home
- wordslinger - Friday, Mar 4, 11 @ 8:49 am:
That consolidation by county idea is one of the goofier ones to come down the road in a while.
Can you imagine one Cook County School District, or DuPage, or Lake? I can’t imagine what it would do to property values in wealthier communities.
- cassandra - Friday, Mar 4, 11 @ 9:07 am:
Why do we need “collective solutions” when we can just borrow some more money. This seems to be the real approach of Quinn/Vaught and they are no doubt heartened by the recent brisk sale of $3.7 billion in expensive (to the taxpayer) bonds for the pensions. Why stop at $8.7 billion.
- Arenda Troutman Fan Club - Friday, Mar 4, 11 @ 9:11 am:
Eliminate those tuition waivers!
- Bemused - Friday, Mar 4, 11 @ 9:27 am:
As far as the pension problem this is another classic case of government do as I say not as I do. If a Private Sector pension plan were at those funding levels the Feds would probably have already pulled the plug and thrown it into the Pension Benefit Guaranty Corp. The folks at United Airlines could tell you how great that is. Max benefit is calculated at approx. $33.75 x years served per month. Example 30 years service x 33.75= 1012.50 per month. Does not matter what was promised that is what you get. Because of losses during recession a lot of pension plans are making changes to avoid this poison pill.The bill will come due. How far down the road will they kick this can.
- shore - Friday, Mar 4, 11 @ 9:27 am:
on the plus side if this goes through the next election will come with new districts so the republican candidate can simply put out a mailer saying xyz democrat raised your taxes, didn’t cut spending and ruined your child’s school.
- Keep Going - Friday, Mar 4, 11 @ 9:41 am:
Don’t limit consolidation just to schools. Look at the townships. Each township has their own offices, paid clerks, supervisors and trustees. Township government is so outdated and unnecessary. All it does is provide a salary, pension & insurance for a few hours of work each month for antiquated services. Township government is a property tax burden that has outgrown its usefulness!
- cassandra - Friday, Mar 4, 11 @ 10:01 am:
Keep Going-you must be new to this. Have you any idea what it would take in terms of effort, political will, whatever, to eliminate a township.
Everybody knows they are archaic. But has one ever been eliminated.
- Illannoyed - Friday, Mar 4, 11 @ 10:28 am:
What continues to hack me off about the Chicago Tribune’s attacks on state pensions is that it’s in the pocket of the Commercial Club’s Civic Committee. The Civic Committee is a group of corporate fat cats whose compensation packages are–I’m not kidding–20 and 30 million a year. I don’t see them talking about shared sacrifice that involves them. Why hasn’t there (tell me if there has) been some commission with a reasonably balanced group of interests to weigh in on the budget? I know that sounds naive. But politicians are always looking to the election, and the Tribune is hardly unbiased in its coverage. And we all now that pork is still a big part of the budget.
- OldIllini - Friday, Mar 4, 11 @ 10:37 am:
There is another pension wrinkle many people aren’t aware of. I used to teach at the University of California, and then joined the University of Illinois, retiring at age 69. By agreement, I rolled my California pension into SURS. So about 1/3 of my total pension contribution was from my California pension and 2/3 from Illinois. I have no idea how many people have done this, but it is not unusual for faculty to switch to a different university. The assumption all along, of course, was that the State of Illinois was keeping up its half of the bargain.
- PPHS - Friday, Mar 4, 11 @ 10:53 am:
I think that IL. needs a public initiative and see how the public feels about these overly expensive superintendents, with offices within 15 miles of each other, all over the state.
- PublicServant - Friday, Mar 4, 11 @ 11:10 am:
The Counsel for the Senate Democrats just came out with a 76 page opinion stating that R. Eden Martin’s old law firm, Sidley & Austin, is full of it regarding when the vesting of pension benefits accrues to the employee. Bottom line is the Illinois Constitution protects the pension from unilateral action that serves to “diminish or impair” them.
The applicable sections of the Illinois Constitution were written in at the 1970 Constitutional Convention, because our representatives were already not making the mandated payments, and state employees wanted that benefit put into writing for their protection.
I became a state employee in 1980. I’ve never been in a union, but that’s irrelevant. You better believe that over the years, as I’ve received no annual raise on several occasions, and have been forced to take furlough days that I made the decision to continue my employment with the state because of the promise of the pension. I’ve made financial decisions for myself and my family (a wife and three children) because of that pension promise, and I signed a contract each year over 30 years for my current salary and the vested pension benefits.
When I recently contracted for a kitchen remodeling, I signed a contract paying half up front prior to the completion of the contract, with the remainder due when the job was completed. If, instead of having the money to pay that contractor when my kitchen was done, I instead went out and bought some living room furniture, and then told the contractor that I refuse to pay him his “bloated, unsustainable” rates, and I spent the money on other needs, he’d have me in court before I could say “The Civic Committee of the Commercial Club of Chicago”, demanding payment, and he’d win. That didn’t happen, because I pay my bills. I’m sure you do too. Or am I wrong about that?
In 1970, the pensions were written into the state constitution. Over 40 years have gone by, with the people of this state voting 2:1 against calling a Constitutional Convention as late as 2008. It took us 40 years to get into this mess, and it’ll take at least that long to get out of it. I was all for passing pension “reform” for future employees, because they can make the same decision that I did each year. If they choose to become a state employee now, they do so knowing exactly what benefits they can count on going forward. But to change the rules of the pension that I’ve been counting on for 30 years is both radical, and un-American. I’ve got no time to financially adapt to the “new reality” that many would foist upon my family and I, but I hear every day about how “private sector employees have been screwed out of their pensions, so why not you?” To that I say that’s exactly why I took a job with the state. I saw what happened to the pensions at GM, and I made the decision to take a little less salary now, so that in the future, I and my wife, wouldn’t be a burden on our children. We’ve gone through many tough financial times over the years where the additional salary that I could have received in the private sector would have come in handy. Now, if R. Eden Martin gets his way, I’m looking at even tougher times in retirement. What happens, happens, and I’ll find a way to make due, just as I’ve done every year, but these United States are going down the tube fast. Mainly because we let people like R. Eden Martin and Scott Walker divide us against ourselves, leaving them with all the money, and all of us in misery.
- Responsa - Friday, Mar 4, 11 @ 11:24 am:
McRaith as Obama Admin Insurance Czar? Does not the WH see that continually promoting Illinoisans and Chicagoans to high profile jobs is starting to look bad?
- jerry 101 - Friday, Mar 4, 11 @ 11:47 am:
The consolidation idea is the best idea to come out of Springfield in a while - and is long overdue.
All these places where there is an elementary school district AND a separate high school district need a wake up call - that separate high school district needs to be rolled into the elementary district - There’s not discernable reason to keep these things separate.
I know in some places (esp. very rural), one high school might cover several elementary districts. Ok, that’s a bit better a reason, but then you have to ask why one high school can cover region X, but it takes 3 elementary school districts (which may also have only one school in each of them, especially if they’re very rural) to cover the same region. Maybe the 3 elementaries need to roll up into the high school district.
And, in the suburbs, you run into the situation where the elementary school distict that primarily feeds a high school has slightly different borders (so the high school takes kids from 4 different districts or something - 90% from one district, 10 percent from 3 others). Easy enough to solve - The high school district is disolved, and the school goes to the elementary district that represented most of its population.
In any and all of these cases, you’ve got a bunch of people doing the same job for no discernable reason except that its the way the districts were set up.
I don’t like giving a lot of people the axe during a bad economy, but slimming down the number of districts in Illinois is long overdue.
Plus, it’ll mean less money spent on administration, and more money for education (if funding levels remain unchanged).
And someone mentioned ending the township government system - another great idea.
Some of the goofier special districts should also be reviewed and eliminated. Too many special districts out there that should be rolled into county governments.
- so... - Friday, Mar 4, 11 @ 11:56 am:
It’s entirely possible I’m missing something, but from looking at the Auditor General’s report, it looks like he’s leaving out the debt service on the FY10 and FY11 pension obligation bonds in calculating the state’s required pension contribution. His table only factors in the debt service for the FY03 bonds.
If that’s the case, isn’t the state’s required pension contribution for FY12 significantly higher? The combined debt service in FY12 for the two recent pension obligation bond issues is $935.2 million.
I ask because it seems odd that the Inspector General is including debt service for the FY03 bonds in his calculation of the state’s required pension contribution, but not the debt service for the FY10 and FY11 bonds.
- mokenavince - Friday, Mar 4, 11 @ 12:23 pm:
I think Jerry 101 nailed it right on the hear. Bravo I second his motion.
- Champaign Dweller - Friday, Mar 4, 11 @ 12:31 pm:
Townships aren’t needed where other forms of government exist. For example, why do we have a City of Champaign Township? Surely we could get rid of it and consolidate those services with the City of Champaign. There must be other places where the township is equal to another form of government.
- Mr. Ethics - Friday, Mar 4, 11 @ 12:55 pm:
McRaith could be czar. He is one Director that actually works, and would be a loss to DOI if he leaves.
- dupage dan - Friday, Mar 4, 11 @ 3:13 pm:
@- cassandra - Friday, Mar 4, 11 @ 10:01 am:
Keep Going-you must be new to this. Have you any idea what it would take in terms of effort, political will, whatever, to eliminate a township.
Everybody knows they are archaic. But has one ever been eliminated. =====
Well, if you wanted to eliminate the clearly wasteful and obviously unnecessary townships it would require a governor with a mandate AND the will to use it. Someone not afraid to make the radical changes necessary to save our state from oblivion.
Oh, wait, never mind - that’s Wisconsin.
- 618er - Friday, Mar 4, 11 @ 3:38 pm:
@- cassandra - Friday, Mar 4, 11 @ 10:01 am:
Keep Going-you must be new to this. Have you any idea what it would take in terms of effort, political will, whatever, to eliminate a township.
Everybody knows they are archaic. But has one ever been eliminated. =====
Yes they have… A couple of election cycles Perry County voted to eliminate Townships. I know the road districts were dissolved into the county, and I think the twp governments were eliminated.
- Nearly Normal - Friday, Mar 4, 11 @ 4:00 pm:
Cassandra–The City of Bloomington Township was eliminated and those services folded into the City of Bloomington a few years ago. It was redundant to have both a township and city with the same boundaries. There is a Bloomington Township but it encompasses only the rural areas.
- Retired Non-Union Guy - Friday, Mar 4, 11 @ 4:17 pm:
…so.. I think paying off the most recent pension bond is covered by the recent dedicated 1/2% income tax increase
- dupage dan - Friday, Mar 4, 11 @ 4:23 pm:
618er,
When did that happen? Why didn’t I notice that the world came to an end?
More importantly, were there any real cost savings realized?