* I had more details about payment rates for several pension systems for subscribers this morning, but the SJ-R has a story up about what it will cost teachers to stay in the current “Tier One” pension system under the new reform bill. Employees will have an option to pay the new, higher percentage, move to last year’s “Tier Two” system (lower benefits, higher retirement age) or go to a 401(k)…
What’s unclear is how much more employees themselves would have to pay. Lawmakers are waiting to hear from actuaries with the state’s retirement systems and those in the city of Chicago and Cook County before the bill’s language is finalized, said McCarthy said.
“That’s how they’ve (legislators) got to make the decision on the vote,” McCarthy said. “It’s not going to be an easy vote for any member of the General Assembly.”
However, the price of staying in the current system will not be as steep as originally thought. For teachers, the Commission on Government Forecasting and Accountability has estimated their contribution to their own pensions would be 13.77 percent of their salary instead of the current 9.4 percent in order to keep their current benefits going forward, McCarthy said. Some teachers had believed they would have to contribute as much as 20 percent of their salaries.
“I think if we can keep it at 13, 14 percent, a good majority will stay in Tier 1,” he said. “Most of the people that talked to me in my office — they thought a more reasonable thing like that, they could understand that. I think they’re cognizant of what a wonderful benefit they have.”
That 13.77 rate pays the actual cost of the pension system when you factor in the state’s additional contribution. The unions will undoubtedly sue to block this if it becomes law.
Thoughts on this?
* Roundup…
* Madigan: Workers’ comp system ‘ought to be changed’: House Speaker Michael Madigan threatened to move forward with a plan that would gut the 99-year-old workman’s compensation system in Illinois if ongoing negotiations over reforming the system prove fruitless. The alternative plan, sponsored by Rep. John Bradley (D-Marion), would essentially blow up the current workman’s compensation system and require decisions on how much a worker should receive for injuries on the job to be made by the courts as opposed to a state board.
* Editorial: Work comp deja vu
* States go all out with tax incentives, deals to hook firms - Critics say states, in push to attract businesses, often do more harm than good, with few jobs created and money wasted
* Time running out for workers’ comp reform - Key hurdles slow lawmakers’ bid to meet governor’s deadline
* State shift in patient-care programs leaves Chicagoans without coverage: The Quinn administration next month is ending a statewide program touted for its savings for Medicaid patients with chronic diseases. It will be replaced with a larger, more expensive pilot program that covers the Chicago suburbs but excludes thousands of residents in the city and the rest of the state.
* Competing budgets at the Capitol: “I don’t expect that this budget will be the final spending plan. This is a budget that has been adopted by one chamber. This is a two-chamber legislature with the governor,” said Madigan. “(Senate President John) Cullerton and I met with the governor yesterday, and we reiterated our position that is now about 4 months old that we want to work with the governor, with the budget office, and we want them to tell us where there should be changes in these budget bills.”
* Illinois Democrats slice, dice budget
* Editorial: Disabled would be hit hard by proposed cuts
* Pre-School Fights Quinn Budget Plan to Eliminate State Money for HIV/AIDS-Affected Toddlers
* School officials attest to consolidation difficulties
* Quinn’s cuts would hurt cities
* Push to make senior tax break automatic stalls in House - Speaker Michael Madigan opposes benefit for Cook County seniors
* House OKs deep cuts in preliminary budget
* Shorewood sending message to Springfield
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Question of the day
Monday, May 16, 2011 - Posted by Rich Miller
* Rahm Emanuel was sworn in as Chicago’s new mayor today…
“Today, more than any other time in our history, more than any other place in our country, the city of Chicago is ready for change,” Emanuel said after welcoming the dignitaries and the crowd.“
His entire address is here.
* The Question: How much of a “change agent” do you expect he will be? Explain, please.
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Yell at Chicago’s mayor, get arrested
Monday, May 16, 2011 - Posted by Rich Miller
* I’m glad nobody was hurt, but what the heck was this copper thinking?…
About 4:45 p.m. Friday, as a crowd gathered to watch Daley say goodbye to City Hall, Janusz Kopycinski, 30, allegedly yelled “F - - - the mayor,’’ police said.
Kopycinski ran, followed by police officers. As he was being arrested, a male officer was grazed by a moving CTA bus, police said.
So, we’re no longer allowed to shout a fairly common obscenity at politicians without the threat of arrest? Really?
* Stay classy, Daley…
Monday’s event was billed as an “open house,” but reporters were barred from the mayor’s office. And even though there was a photo op of the handshaking, the Chicago Sun-Times, which has broken scores of stories on corruption and contract cronyism during the Daley years, was specifically excluded.
I’m glad there’s no pettiness left in Rich Daley’s soul now that he’s leaving. Sheesh.
* Related…
* Sneed: Daley setting up shop with son
* Emanuel ready to do it his way - Chicago’s new mayor to import D.C.-style stagecraft and management
* Emanuel to be sworn in today as Chicago’s first new mayor in 22 years
* Rahm Emanuel: ‘I’m energized as well as pinching myself’
* Marin: Time for Rahm Emanuel to take the reins, tackle city’s problems
* Zorn: Emanuel makes no little list of promises
* Emanuel’s planned spending freeze just a first step - Growing budget woes will demand more action down the road
* Mayor-elect: ‘We all have a role to play’ - He gardens before attending Grant Park concert, invite-only party
* New CTA president’s first goal: Fix finances - Claypool says he would eliminate slow zones — if agency had enough money
* Community activists want TIF funds to help rebuild neighborhoods
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Caption contest!
Monday, May 16, 2011 - Posted by Rich Miller
* House Majority Leader Barb Currie during last week’s Capitol Capers show…
Keep it clean, people. Lifetime banishments, and worse, are no big deal to me. Don’t push the envelope.
Winner gets a free ticket to a White Sox game this summer.
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Face it, we’re hostages
Monday, May 16, 2011 - Posted by Rich Miller
* My weekly, syndicated newspaper column looks at The Troubles…
With the economy the way it is, just about every state in the country is frantically scrambling to keep their local corporations from leaving or attracting new jobs by doling out huge government incentives.
Illinois, of course, is a special case, which means it’ll probably cost us lots more to keep and attract jobs than just about any other state.
Our years-long political civil war between former Gov. Rod Blagojevich and House Speaker Mike Madigan during the worst international economic crisis since the Great Depression saddled the state with migraines for years to come. No problems were solved or even addressed while everything was collapsing around them during their fight to the death. By the time Blagojevich was finally arrested, impeached and removed from office, the state found itself with a $9 billion hole in its budget.
Blagojevich’s criminal reputation and our horrific financial problems have made us a national laughingstock. The recent income tax hike passed by the General Assembly and signed into law by Gov. Pat Quinn prompted other governors to openly deride us and publicly (and privately) goad our employers into leaving.
Our extremely high workers’ compensation costs (2nd in the nation) were treated to a nasty media spotlight with the uncovering of a workers’ compensation scandal at a state prison. Hundreds of state workers filed for and received big workers’ comp checks because, they claimed, turning heavy cell-door keys gave them carpal tunnel syndrome. Even worse, the state didn’t attempt to find out if most of those workers had filed valid complaints. The howls of derisive laughter could be heard far and wide.
We’re such a popular punching bag that Missouri actually appealed a lawsuit all the way up to the United States Supreme Court to insist that protecting some of its farmland in a federally designated Mississippi River flood zone was infinitely more important than the 80-year-old Army Corps of Engineers plan to save Illinois towns along the river from drowning. The delay caused by that lawsuit may have resulted in the severe flooding of at least one southern Illinois town.
So, when Motorola Mobility said it might move away, it got $100 million in state tax credits. Gov. Pat Quinn claimed afterward that the company had to pledge to invest $500 million in research and development, but that investment was apparently the company’s plan all along, no matter where it went.
Groupon, the fastest growing company in America last year, barely had to glance at other states and got $3.5 million in pledged tax credits from Gov. Quinn.
Caterpillar’s CEO sent a letter to the governor revealing that the company was being recruited to move to another state. That caused the entire establishment to suffer a collective nervous breakdown, and the media, of course, had a field day. Never mind that the CEO later said he had no intention of moving and wanted to work to make his state a better place to do business. The media’s theme was firmly established, so it was just too easy to just write stories and columns about Illinois’ impending doom.
The latest threat to move elsewhere is from Sears.
Twenty-one years ago the company was loaded up with millions in state and local tax incentives to stay in Illinois. But those incentives are expiring next year and the struggling, aging behemoth has its hand out yet again.
If Illinois doesn’t pay up, Sears could move its headquarters away, taking 6,000 direct jobs with it and costing us thousands more jobs via suppliers, contractors and businesses which rely on Sears employees for their livelihoods. The economic and tax implications would be huge. So, since it would cost far more to let Sears leave than to keep it around, expect a juicy deal to be put on the table.
Face it, we’ve made our own bed here and now we’re being held hostage and there’s almost nothing we can do about it except to try to cut the best deals possible.
It’s distasteful as all get-out, but we’re basically left with no good choices. And the more deals we cut, the more deals we’ll have to cut. Until we can overcome our serious, long-standing problems, we’re at their mercy — and corporate CEOs are not generally known to have an abundance of that human quality.
* Related…
* States go all out with tax incentives, deals to hook firms - Critics say states, in push to attract businesses, often do more harm than good, with few jobs created and money wasted
* New Jobs coming to Mattoon
* Evolve or die: Field Museum confronts its fate
* Data Networks Pose a Threat to Wireless Carriers
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“Vultures” fight over foreclosure fees
Monday, May 16, 2011 - Posted by Rich Miller
* My Sun-Times column was moved to Sunday this week…
Every now and then, I find myself privately rooting for and against both sides of a bill at the same time. I’m doing it again.
Two sides in Springfield are fighting over a rather unseemly and rapidly growing pile of auction fees created by the foreclosure crisis.
That’s a heckuva way to make a buck. Auctioning off what used to be somebody’s home and collecting a sweet little fee.
But, I suppose, somebody has to do it. You can’t leave foreclosed homes empty forever. They can become a blight on neighborhoods. The companies holding the mortgages often don’t take care of them and they crumble or are vandalized, or the yards aren’t maintained, or drug dealers or other criminals squat in them, or all of the above.
State law has long allowed private companies to conduct foreclosure auctions. The auctioneers appear to make a fairly decent living off of the business, particularly now that people are being kicked out of their homes at a record pace.
Counties, like pretty much every government everywhere, watched in horror as their tax revenues plummeted during the Great Recession. One of the very few growth areas was foreclosure auction fees.
The Bloomington Pantagraph reported the other day that foreclosure auction fees are now eight percent of the McLean County Sheriff’s total revenues.
But the sheriffs collect those fees only if they host the auctions. So some counties are either not allowing the private foreclosure auctioneers to do business or they are pushing judges hard to steer the auction dollars to sheriffs.
The private companies say they can handle the auctions faster and cheaper. The sheriffs say quicker auctions means impoverished, stressed-out homeowners are booted from their homes a lot sooner. That’s a very good point, and it’s one reason I’m so conflicted about this bill. On the other hand are all those abandoned homes, which, by the way, the sheriffs also have to worry about.
The Lake County Sheriff’s Office claims there were serious problems with private auctions, so it was forced to set up a system to address the complaints. However, under questioning at a Senate committee hearing, a sheriff’s staffer said she had heard only rumors and couldn’t substantiate — or even list — any actual homeowner complaints.
So, yeah. It’s probably all about the money.
Want more proof? The Senate’s sponsor offered an amendment to give the sheriffs $200 for each foreclosure auction handled by a private company. Two big counties Cook and Will, quickly switched from “opposed” to “neutral.” Getting something for doing nothing ain’t bad at all. But it costs very little to hold a sheriff’s auction. And the markup is so high that not everybody wanted to give up all that blessed cash.
Of course, some banks complained about the added cost of kicking $200 to the sheriffs, so the amendment hasn’t yet been officially adopted.
The bill requires judges to follow the wishes of the foreclosure plaintiffs, meaning the banks or other mortgage holders. Because the private auction companies say they are cheaper and faster, they think that gives them an edge. Opponents say cutting out the views of the defendants — the people who are being kicked out of their homes — is illegal and downright wrong.
Again, a good point. But I’d be more sympathetic if this fight between vultures didn’t make my skin crawl.
Thoughts?
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* When I saw the LA Times report about Pabst Brewing Co. moving its Woodridge, IL headquarters to Los Angeles, the first question that came to my mind was whether Attorney General Lisa Madigan might have run the company off. From the LA Times story…
The company, purchased last year for about $250 million by billionaire investor C. Dean Metropoulos, declined to comment about the reasons behind the move or how many local jobs it might create. Pabst spokesman Mark Semer said that Metropoulos’ two sons, Daren and Evan, both live in Los Angeles and run the company with their father, who lives in Greenwich, Conn. […]
The Metropoulos brothers introduced a new label last month called Blast by Colt 45 and signed rapper Snoop Dogg as a brand ambassador. Blast, a fruit-flavored malt beverage, has drawn the ire of attorneys general from more than a dozen states for its high alcohol content and youth-oriented advertising. Illinois Atty. Gen. Lisa Madigan has called the drink “binge-in-a-can.” [Emphasis added.]
* From Attorney General Madigan’s “binge-in-a-can” press release last month…
“Alcohol abuse among young people is a serious and alarming epidemic,” Attorney General Madigan said. “A product like this only serves to glamorize alcohol abuse and promote binge drinking, threatening the safety of those consuming it.”
The Attorneys General’s letter, joined by 17 other state, city and territory officials, details concerns over Blast, which amounts to a “binge-in-a-can.” The 12-percent alcohol concentration of Blast means a single 23.5 ounce container is equivalent to drinking an entire six-pack of typical American beer. Madigan said the promotion and marketing of Blast appeals to minors, with its brightly colored cans and fruit flavors and a marketing campaign featuring hip-hop artist Snoop Dogg.
* The company’s response from last month…
Blast is only meant to be consumed by those above legal drinking age and does not contain caffeine. As with all Pabst products, our marketing efforts for Blast are focused on conveying the message of drinking responsibly. To that end, the alcohol content of Blast is clearly marked on its packaging, we are encouraging consumers to consider mixing Blast with other beverages or enjoy it over ice, and we are offering a special 7 ounce bottle for those who prefer a smaller quantity, among other important initiatives.
* Woodridge’s management analyst Jack Knight released a statement over the weekend…
‘’According to Village sources, the owners of Pabst wanted to relocate their corporate headquarters to where they live in California. Pabst last reported to the Village that they have 26 employees at their Woodridge office and that they occupy 12,000 sq. ft. Pabst relocated to Woodridge from San Antonio in 2006, and the Village did not provide any incentives for them to relocate.”
The company did, however, get a ten-year, $1 million aid package from Illinois…
“The Midwest has always been home for Pabst Brewing Company, so we are excited to be re-establishing roots in Chicago and Illinois, where we plan to be for years to come. I thank Gov. Blagojevich and his team for facilitating this move and for the critical support to bring us here,” said Kevin Kotecki, CEO of Pabst Brewing Company.
No word yet on whether we’ll get any of that money back.
* From a memo sent to employees last Wednesday by John Cochrac, Pabst’s new CEO…
After much contemplation and several thorough reviews of the current Pabst’ corporate structure and capabilities, I have decided that we will be moving the headquarters to Los Angeles this summer and closing the Woodridge office. As we build a strong leadership team, it is imperative that we are all together and in one location. This is not an easy decision and we have a wonderful group of employees in Woodridge but I believe it is what is best for Pabst.
* But here’s the kicker: California Attorney General Kamala D. Harris signed the same letter that Lisa Madigan did. And it was that letter which coined the “binge-in-a-can” slam.
The only difference was that California’s attorney general did not issue a press release blasting the strange brew, as Madigan did. I also couldn’t find a story online where AG Harris had been quoted about the product.
So, I suppose Madigan’s eagerness to publicize her involvement might’ve had some impact, but you’d think that if the company wanted to move to a state with a friendly attorney general, it would’ve gone somewhere besides California. Instead, this was almost undoubtedly about moving the company close to the owner’s Hollywood trust fund babies, one of whom just bought Hugh Hefner’s LA mansion for $18 million in cash…
The boys also helped the champagne brand, Perrier Jouet, another Metropoulos brand, become featured in Snoop Dog and Limp Bizkit concerts, their father said.
* And these are the two Hollywood kids responsible for yanking their new toy out of Illinois. Dean with Snoop…
Daren with Warren G…
* Even so, the Illinois Republican Party still thinks somebody here is to blame. From its Facebook page…
If Pat Quinn can’t keep Pabst in IL, maybe Illinois Republicans can! Join us at 4PM [Friday] at Villain’s Bar & Grill, 649 S. Clark St., Chicago. A generous donor will buy the first 25 Pabst Blue Ribbon beers for patrons of the bar after 4:00 PM. to show support for Pabst, despite our high taxes from Pat Quinn.
Oh, please. California’s corporate income tax rate is 8.84 percent, which isn’t much different from Illinois’ new rate. Its highest personal income tax rate (which CEOs pay very close attention to) is 9.3 percent, far higher than ours. Its state sales tax rate is 8.25 percent, way higher than ours. And Los Angeles’ sales tax rate is 9.75 percent.
Toasting this company after it announced it’s leaving Illinois is beyond inappropriate.
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