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* The Chicago Tribune editorial board takes Quinn budget director David Vaught to task for a comment Vaught made yesterday on the pension borrowing plan…
[Vaught’s] peculiar assertion that borrowing $3.7 billion to make the state’s 2011 pension payments would be a form of refinancing unfunded pension obligations that have been piling up for decades was a stretch too far for us to accept.
What Vaught actually said was the state was trying to convert far more expensive “soft debt” to much cheaper “hard debt.” The pension funds charge the state 8 percent interest on old, unpaid debt. The bond markets charge about half that or even less. Much of that $3.7 billion that Quinn wants to borrow is for old debt, but not all, of course. The state is borrowing the entire amount owed to the pension funds, including money to make this fiscal year’s individual pension payments.
That’s not too hard to understand, is it?
* Tribune reporters weren’t all that supportive, either…
Gov. Pat Quinn pledged Thursday to whittle $1 billion in spending, his cuts hitting students and the mentally ill especially hard.
Even with his unprecedented power to shape the budget, Quinn’s cuts will do little to chop down the state’s mountain of debt. Illinois still faces a $13 billion shortfall next year. […]
It’s a budget that counts on a large dose of hope. Quinn is counting on Congress and President Barack Obama to come up with $750 million to help pay for health care for the poor. And the governor is hoping the Illinois Senate changes its mind and votes to borrow $3.7 billion to keep the pension system afloat.
Republicans pounced, contending that $891 million in Quinn’s cuts simply are promises to keep money in reserv
* The Sun-Times wasn’t impressed..
When a state supposedly run by grownups fails to do its job, the result is the budget Gov. Quinn signed Thursday.
It’s built around borrowing and whacks people who can least take the hit. The latest victims are people with developmental or other disabilities and those seeking mental health services.
If you’re not Medicaid eligible and you received state-funded counseling in June, you’ll probably be cut off soon.
If you’re not dirt poor and disabled, you could be out of luck if you need rehabilitation services.
And the pain you’ll suffer really gets Illinois nowhere.
* This lede pretty much sums up the budget plan…
One of the main sentiments expressed Thursday about Illinois’ new budget was disappointment - either in the cuts made, or that the state put itself in a position to render such cuts necessary.
AFSCME is also concerned about an executive order Quinn issued Thursday directing state agencies to make further reductions on their own, ranging from curtailing travel to canceling unnecessary subscriptions and memberships to slashing printing expenses by 25 percent.
One part of the order also directs agencies to develop a plan “to limit expenditures associated with group insurance, including increasing employee and retiree group insurance co-payments and deductibles.”
“We’re very firm in our belief that our contract sets contribution rates for state employees and retirees,” Lindall said.
Vaught said the administration intends to bargain with unions over the issue.
After speaking with state Department of Human Service officials on Thursday, one thing is clear for SPARC in Springfield, according to Carlissa Puckett, SPARC chief executive officer.
The agency’s Epilepsy Resource Center, funded with grants from state general revenue, will close, Puckett said.
* And on the other side…
Republican State Senator Matt Murphy is skeptical about Illinois Governor Pat Quinn’s budget cuts. […]
MURPHY: I think it’s another insincere effort at convincing… a head fake towards fiscal responsibility to get through the election when they can pass an income tax hike.
* One bright side…
The education budget cuts announced Thursday were not as bad as they could have been, according to local education officials, who remain uncertain about when they’ll actually get the money.
As part of $1.4 billion in budget cuts, Gov. Pat Quinn trimmed $241 million from several school grant programs. He left the general state aid formula, the centerpiece of the state’s funding for schools, intact.
“It’s far better than it could have been,” said David Wood, Bloomington District 87’s chief legal and financial officer.
But every bright side has a dark side…
Among the $6.5 million Decatur has yet to receive for the fiscal year just ended on June 30 is transportation funding.
“What am I supposed to do if I can’t fund transportation? How am I supposed to get children to school?” she said. “How are we supposed to function? What am I as a superintendent supposed to do? We’ve already cut $7 million from our budget. What am I supposed to do to make sure that the staff receives salaries and benefits and the children are educated? You need staff to educate children.”
The district is working on a month-to-month basis right now, she said, because there’s no way to predict when or if state funds will show up. Last week, districts throughout the state finally received a long-overdue payment, which brought them up to November. They’re all still owed payments from December through June.
The only agency that will see an increase in funding is the Department of Health Care and Family Services, where the budget went up by $162 million. The department will have to make a $7.2 million cut in operating costs. About $169.2 million will go toward getting certain Medicaid providers on a 30-day reimbursement cycle, which is required to capture a higher match of federal funds.
* I told you yesterday how Bill Brady reacted to the budget. Here’s the Quinn campaign’s response…
Governor Quinn’s strong action today makes the contrast between the two candidates even sharper.
After a thorough review of the state budget, Governor Quinn struck a balance - cutting $1.4 billion in state spending, while protecting healthcare, education, and public safety programs to nurture Illinois’ economic recovery.
As a member of the Illinois General Assembly, Senator Brady had the chance to lead this session. Instead, he stood in the way of every constructive plan that was put forward and has routinely placed politics ahead of Illinois residents.
He’s proposed a billion-dollar tax cut for big businesses without specifying how he’d pay for it. He has called for a 10 percent across-the-board cut for state departments, which would drastically reduce vital services such as education, health care, and public safety while making the state ineligible for federal matching funds. And he’d lower the minimum wage for hard-working families.
Bill Brady’s every economic proposal has been derided by experts. It’s apparent that Senator Brady fails to understand the complexities of our budget.
* Related and a roundup…
* Quinn seeks to cut state budget $1.4B
* Quinn budget cuts $1 billion, leaves $13 billion hole next year
* Quinn announces budget cuts
* Quinn describes deep cuts, says more may be coming
* Quinn signs new budget, but details still lacking
* Quinn’s budget still fluid
* Quinn, Legislature failed to fix budget
* Debt and denial
* State Senator Murphy Skeptical Governor Will Cut Spending
* Teacher Union Wary of Illinois Budget Cuts
* Local educators: State cuts could’ve been worse
* Cutbacks greet new U. of I. chief
* U of I president to look beyond govt. for funding
* Groups wary of budget cuts to social services
* Social services feel the blow
Allocation Summary Historical Approp Master 1 Historical Approp Master 2 Budget Emergency Budget Act Executive Order 10 - 2010 - Spending Reductions SCANNED Executive Order 10 - 2010 - Spending Reductions Reduction Veto Message
posted by Rich Miller
Friday, Jul 2, 10 @ 10:30 am
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Considering it was just Benefits Choice month with copays and deductibles clearly laid out while making one’s choices, one would think the state wanting to change it and/or negotiate and announcing this the every day the new choice take effect is a bit backwards.
Comment by Cindy Lou Friday, Jul 2, 10 @ 10:45 am
For the average taxpayer, this is very confusing Is Quinn claiming cuts that actually won’t get made in order to give the impression of government austerity? Is he holding out until January when he’ll assume his election is a mandate for a substantive middle class tax increase. Are Reublicans correct when they says that Quinn’s cuts are far less draconian than he claims–indeed, practically nonexistent? This feels a lot like last year. Unfortunately, most of us that still have jobs don’t have the time to pore through budget documennts and do our own fiscal analysis. So Quinn’s obfuscation approach will probably work. he has the biggest pulpit after all. Especially given the weak Republican bench.
Comment by cassandra Friday, Jul 2, 10 @ 10:57 am
This is a political year. We have a governor who wants to be elected. So, it would have been too much to expect any leadership. Leadership requires taking a stand, selling it, and sticking with it for longer than for a news cycle. This governor had the job land on his lap after six years in the Blagojevich administration without seeming to be aware that he could get his wish and become governor.
Rarely have we had someone with as much statewide office experience as Pat Quinn. Rarely have we had a guy sit alongside a failing governor who brimmed with corruption and incompetence, yet seemed completely unready to take over when the law stepped in and made him governor. What kind of co-pilot was Pat Quinn. What kind of a planner? He had a staff, what did they discuss as the rest of us discussed how Blagojevich was going to be removed from office? You mean nobody was ready to become a governor or a gubernatorial staffer after all those years of watching Illinois fall apart as the Second In Command. And even if we all recognize that the Office Quinn occupied was ceremonial except when ready - at what point did they recognize they would need to be ready?
Quinn, of all people in our state history, has no excuses not to have hit the ground running. He knew he would want to run this year, right? He knew he had to handle these budget issues, right? He knew from experience that in a political year no one wants to shoulder responsibilities, right?
So what did he do? He didn’t lead, he didn’t govern and every challenge ended up a flip-flopping compromise. This is the best he could do?
So here we are. 2010. We are still stuck without state leadership with a governor hoping he can muddle through our fiscal crisis in a way for him to win election. This is the kind of budget we get. Aimless. Pointless. Useless. And not a surprise to those of us who thought that Pat Quinn with his years in office and his image as a doer, has repeatedly disappointed us at a time when disappointment seems to be the only thing Illinois government produces in abundance.
Comment by VanillaMan Friday, Jul 2, 10 @ 11:10 am
Not a fan of Gov Shrek,but at least he’s deciding on something.What possible authority gives a state senator or rep license to comment on his decision when they didn’t have the guts to do it themselves.?
Comment by nick Friday, Jul 2, 10 @ 11:21 am
Excellent post VM!! Perhaps Quinn should ponder how he will feel the day after losing an election and he has nothing left. Not even the dignity that comes from running a campaign that honestly dealt with the electorate.
It’s painfully evident that Gov. Quinn lacks executive decision making skills. He not only has failed to deliver a workable management plan, he has failed time and again to execute even the management plan he’s delivered. If “execution is the chariot of genus,” Quinn’s executive staff is running around on skateboards.
Comment by Louis Howe Friday, Jul 2, 10 @ 11:29 am
“Not a fan of Gov Shrek,but at least he’s deciding on something”
What…cutting 1 billion out of a 13 billion hole and giving little detail. The administration has no idea what to do.
Comment by Anonymous Friday, Jul 2, 10 @ 11:31 am
===What possible authority gives a state senator or rep license to comment on his decision when they didn’t have the guts to do it themselves?===
Exactly!!!!!
Comment by Deep South Friday, Jul 2, 10 @ 11:33 am
and we still don’t have a long term plan… or a clue.
Comment by Ahoy Friday, Jul 2, 10 @ 11:36 am
So, at this point, I wonder… what exactly IS the procedure for a state government to undergo an orderly financial meltdown? States can’t legally go bankrupt, but what happens if there simply is no money to pay the overdue bills and current expenses and future obligations? Say the state never pays its past-due bills and creditors go to court and a judge orders the state to pay? But there is no money and the state can’t pay. Or the pension checks stop coming and the pensioners go to court and a judge orders the state to pay? But, again, there is no money and the state can’t pay? Could a court ORDER a tax increase? What if nothing is done and the bills never get paid and the state simply writes them off and the creditors and THEIR creditors go bankrupt? And the pension checks never arrive in the mail and the pensioners go bankrupt? Is it possible that, by doing nothing, the state’s financial problems will simply disappear, incredible as that solution may seem? This is uncharted territory, but some educated guesses, please
Comment by up2now Friday, Jul 2, 10 @ 11:51 am
Wow, VM. Outstanding post.
Comment by Louis G. Atsaves Friday, Jul 2, 10 @ 11:52 am
I am STILL trying to find out: HAVE THE RPUBLICANS PROPOSED AN ALTERNATIVE? IF SO, CAN SOMEONE TELL WHAT IT IS– AND WITH SPECIFICITY?
Comment by the dark horse Friday, Jul 2, 10 @ 11:56 am
I am mad as hell that I have take ANOTHER 12 furlough days this year. I haven’t had a pay increase in years and now two years in a row they are CUTTING my pay. And, it doesn’t save that much money since most people are in the union now. Isn’t it enough to continue to freeze my salary without cutting it? I also pay more for health insurance, and co-pays and deductibles have gone up. I have a family to support just like everyone else.
Comment by RJW Friday, Jul 2, 10 @ 12:07 pm
Please don’t expect an alternative proposal on a controversy from any political party when their chances of electoral success depend upon making the incumbent forced to handle that controversy.
Comment by VanillaMan Friday, Jul 2, 10 @ 12:10 pm
The legislature gave Quinn the authority to do what exactly on this budget? His budget reflects that he has no authority. The unions appear to have more power than he has. The entire system is totally out of control. On our behalf, can’t the courts step into the fray and help us to get some control over the process? What happened to the effort to sue the state over not producing a balance budget as required in the state constitution?
Comment by Vole Friday, Jul 2, 10 @ 12:34 pm
What is Quinn supposed to do? No matter what he does he it will totally unacceptable to large parts of the electorate. Didn’t cut enough? Would Brady’s 10% across the board be enough? Would 25% be enough? The screams about lost services and jobs would be deafening. Or do you cut just enough to get through the election and put the ball back in the court where it should have been? The entire GA gutted out on this because an election is coming. A year from now, which will be here in a flash, the basic situation will be worse, but for the GA no electoral hiding place excuse will exist. In the mean time how many businesses that do work with the state will be cash flowed out of business or cut so far back that they are essentially gone. I do not want to pay more taxes but I notice the cost of milk, bread, clothes, electricity, lumber, cars, and everything else keeps rising regardless of any statement/plan I have heard anywhere. Go talk to you employer about the real cost of the health insurance, not just the portion you pay. Quinn is in a un-winable situation. He may not be the greatest executive the state has ever seen, but in this situation he at least did something that several hundred other ‘leaders’ basically refused to do. Give the guy some credit.
Comment by zatoichi Friday, Jul 2, 10 @ 12:47 pm
Why not put out a real budget that indicates precisely the projected revenues and how much of that will be allocated to various agencies and offices? I know there needs to be some flexibility, but Quinn’s budget basically is not real. If much of the money will never get to where it is budgeted, they why not put out how much will actually be paid out? That would at least allow for better planning.
Comment by Vole Friday, Jul 2, 10 @ 1:00 pm
So the Quinn “campaign’s” response to Brady is essentially criticizing Brady for not governing. Well, we can rectify THAT in November…
Comment by N'ville Friday, Jul 2, 10 @ 1:12 pm
I liked the SJR quote from the UIS Chancellor:
“The truth is, we’ve got to quit pretending this doesn’t exist and do something about it.”
Is it too late to get him in touch with Quinn?
Comment by Vote Quimby! Friday, Jul 2, 10 @ 1:14 pm
==I have a family to support just like everyone else.==
Tell that to the chronically unemployed.
Comment by Vote Quimby! Friday, Jul 2, 10 @ 1:16 pm
@the dark horse,
=I am STILL trying to find out: HAVE THE RPUBLICANS PROPOSED AN ALTERNATIVE? IF SO, CAN SOMEONE TELL WHAT IT IS– AND WITH SPECIFICITY?=
They no longer have to.
Comment by dupage dan Friday, Jul 2, 10 @ 1:25 pm
—- They no longer have to.—-
Dupage, I see your point. However, you can’t criticize and offer no solutions of your own. Am I wrong in saying that a 10% across the board cut would be far worse then what Quinn cut? Hasn’t Quinn cut over 3 billion dollars from the budget since he took office?
Republicans continually say NO and offer no better or any solutions. So, yes I think they still should. Of course, now it’s a lot easier since Quinn did the GA’s job.
Comment by The Shadow Friday, Jul 2, 10 @ 1:34 pm
“Quinn did the GA’s job.”
No, he did not. He did not raise revenues. And he did not reduce spending nearly enough. So, he did neither of the two things the legislature could have done to bring the budget closer to balance.
It was ludicrous for the legislature to give Quinn this phantom authority. He is left with hardly any. So we are left with a situation nearly out of control.
Comment by Vole Friday, Jul 2, 10 @ 1:50 pm
The Shadow,
I will repeat for those who are hard of hearing -
THEY NO LONGER HAVE TO.
step one - be an incumbent.
step two - don’t do your job.
step three - lose your job.
In this election year with a perfect storm of financial woes, PQ displays the qualities many have claimed and most have witnessed. Game over.
Even with the label of puppy gasser and spending little of his campaign fund, Brady holds a lead on PQ. Game over.
I wanted PQ to succeed when he first came in. He has done virtually nothing of note to recommend a vote for him come Nov. GAME OVER.
The strategy of anyone seeking to win in Nov with this set up would do best to lay low and remain quiet. Why speak up so’s you’all can take pot shots? I refer you back to the original statement.
Comment by dupage dan Friday, Jul 2, 10 @ 1:52 pm
___VOLE____
I couldn’t agree with you more. I wish the GA would do their job and not worry about the election coming up. Frankly, I, and I’m assuming the voters would respect them and re-elect them if we knew they were making tough decisions and doing what needs to get done EVEN IN A ELECTION YEAR.
Comment by The Shadow Friday, Jul 2, 10 @ 2:49 pm
PQ couldn’t figure out how to get his hand out of a clear plastic sandwich bag, let alone run this states budget.
Comment by conda67 Friday, Jul 2, 10 @ 4:51 pm
For all the criticism Gov. Quinn may be taking for the cuts he plans to enact, where else can he find big savings?
Rich, is it possible for you to bring back your open forum where commenters can recommend budget cuts? I think this would make people think about the sheer magnitude of the state’s budget woes, and to realize the consequences of the substantial budget cuts that would be required to fix the problem instead of kicking the can further down the road.
Quinn’s certainly in a tight spot, but it’s not clear to me that any other person who might otherwise have been Governor at this time (e.g. Topinka or Blago) would be doing any better.
Comment by cover Friday, Jul 2, 10 @ 5:15 pm
At IDOT, there are new hires every day. When you ask where did they come from, the most common answer we hear is that they are Secretary Hannig’s neighbor. Another route are new employee’s that were fired from another agency, i.e. the new acting director of finance & administration.
Comment by Old Timer Saturday, Jul 3, 10 @ 8:10 pm
They are all, legislators and governor, once again breaking the IL constitution by NOT passing a balanced full-funded year-long budget. Criminals.
Comment by state employee Saturday, Jul 3, 10 @ 9:24 pm
Quinn says he is “cutting” the budget on one hand but stuffing the state payroll with overpaid political cronies on the other. Quinn is Illinois corruption as usual and the rewards are for him not the Illinois taxpaying citizen. He could have made an effort to undo alot of the Blagojevich partisanship and illegal budget moves.
Comment by seebee Monday, Jul 5, 10 @ 2:10 pm
The State is not broke !! Look at the Dept of Corrections this month alone all the Job up -grades they are going to make ,lot of money going to a lot of Democrats for nothing -just to get a few votes
Comment by dinger Monday, Jul 5, 10 @ 10:55 pm