Capitol Fax.com - Your Illinois News Radar » 2011

States struggling to assess budget damage from federal debt ceiling deal

Monday, Aug 1, 2011 - Posted by Rich Miller

* One benefit of my vacation was avoiding DC’s debt ceiling nonsense. But now that Congress and the President appear to have struck a deal, my main concern is how this will impact Illinois. There isn’t much out there about the impact on states at the moment. I received this statement from Gov. Pat Quinn’s budget office, which hopes to have more later today or tonight…

We are pleased our leaders in Washington have reached a compromise as to avoid any disruption of government activities. We continue to closely monitor and prepare for the final results and are working with agencies to evaluate the potential outcomes that could affect job creation, Medicaid and our infrastructure.

Yeah. Not much.

* Most of the stories regarding the deal’s impact on the states are now outdated because they were filled with pure speculation. The deal itself was finally released to the public today and you can read the full text by clicking here.

* There are hints, but the actual cuts apparently won’t be known for some time. From Bloomberg…

States received about 35 percent of the $1.62 trillion spent during the 2010 budget year from the federal government, according to the National Association of State Budget Officers. The money is used for programs such as Medicaid, public works projects, and public schools. The debt-ceiling agreement requires Congress to cut $2.4 trillion from the federal deficit, including more than $900 billion in the next decade. […]

The debt-ceiling agreement doesn’t spell out how cuts are to be made, and much of that decision-making is left to a bipartisan congressional panel.

* CNN breaks it down…

Outlays for discretionary programs, which include defense spending, would be cut by $741 billion.

On top of that, $156 billion would be saved because of reduced interest costs on the country’s debt. And $20 billion would be cut from education loan initiatives and by curtailing waste, fraud and abuse in other mandatory programs.

In terms of education spending, the bill would increase funding for Pell Grants by $17 billion between 2012 and 2015. It would also cut student loan funding by $22 billion over 10 years.

The spending caps in the bill would result in $21 billion in savings in the first year, and grow annually from there. By 2021, outlays would be reduced by $112 billion.

States get money from those “discretionary programs,” but, again, there are no details as of yet. States did get one spot of good news, assuming this thing passes…

Moody’s Investors Service said last month it was reviewing the top credit ratings of municipal borrowers, including the states of Maryland, Tennessee and South Carolina, because of the tussle over the federal government’s finances.

Michael Bird, who tracks federal affairs for the National Conference of State Legislatures, said that may be averted should the compromise pass.

* Related…

* Lack of pay for regional superintendents threatens start of school

* Illinois 50 out of 50 in 2010 for state deficit

* Metra: Capital fund in worse shape than operating fund

* Trading Hostages: Why Lobbyists Are a Key Part of the Debt-Limit Deal

* The Four Big Problems With — And Four Silver Linings Around — The Debt Limit Deal

* Debt Ceiling Deal—Less Than Meets the Eye

* The Fine Print on the Debt Deal

* Treasurer: Illinois investment funds remain safe

* Rutherford readies
for debt-ceiling crisis

* As protests brew, Walsh still has Republican support

10 Comments

More hubris, even at the brink of imprisonment

Monday, Aug 1, 2011 - Posted by Rich Miller

* Rod Blagojevich’s sentencing hearing will start October 6th. The Sun-Times reports that Blagojevich plans to testify. For his sake, I certainly hope his lawyer’s comments are not a preview of that testimony…

Blagojevich was “a good, honest governor who tried to help the people of Illinois,” Sorosky said. “He cared about the ordinary guy.”

Unrepentant testimony like that could add more years to his sentence.

* This won’t help him much, either…

In Blagojevich’s case, sentencing at the hands of Judge James Zagel will also come on the heels of a 158-page motion, where the former governor and his lawyers argued that Zagel had his “thumb on the scales of justice” and that the judge’s rulings skewed heavily in favor of the prosecution.

“The motion basically states that we believe that many of Gov. Blagojevich’s constitutional rights were violated at trial, and that therefore he should receive a new trial,” Sorosky said.

Indeed, Blagojevich and his lawyers said categorically that Zagel had reneged on a promise to let Blagojevich testify to his own good intent. In his motion for a new trial, Blagojevich filed an affidavit stating that had he known he would not be allowed to make such claims, he never would have taken the stand.

“His defense to these charges is that he was operating in good faith at all times,” said attorney Lauren Kaeseberg. “And he should have been able to testify to that effect, tell the jury that he operated under good faith and the reasons that he believed he was operating in good faith.”

“And he wasn’t able to do that, and we believe that was not fair.”

* The hearing could last two days…

The sentencing hearing could last two days, U.S. District Judge James Zagel said in setting the sentencing date, depending on the number of witnesses Blagojevich’s lawyers call to testify to his character and his accomplishments as governor.

That list of character witnesses can’t be very long. And since the disastrous fiscal impact of his gubernatorial reign will be felt for years to come, those who testify about his “accomplishments as governor” could be violating their oath to tell the truth, the whole truth and nothing but the truth.

16 Comments

Lauzen says he’s thinking about congressional bid

Monday, Aug 1, 2011 - Posted by Rich Miller

* Is he running for Congress or just paying off old debt? That’s the big question here…

State Sen. Chris Lauzen R-Aurora is considering a run against former Congressman Bill Foster in Illinois’ newly drawn 11th Congressional District.

In an undated fundraising letter, Lauzen invites supporters to a Summer Night in Chicago on Friday at the Union League Club featuring U.S. Rep. Joe Walsh, R-McHenry.

“Someday, if my neighbors agree, I hope to enter the national debate in Congress,” Lauzen’s fundraising letter states.

“The first requirement is for me to raise $150,000. It’s a gruesome amount of money, but it represents only a down payment against the millions that Foster has already spent and will spend to win.”

Lauzen says he still has about $135K in old federal debt from his 2008 congressional bid…

“No matter what I do in my future, I have to pay back for the past,” Lauzen said. “I’m saying I’m exploring it [a congressional run] but if there is any future opportunity, I have to take care of that past obligation.”

It’s possible that Judy Biggert could run in the 11th, which would set up an interesting primary if Lauzen decides to get into the race. Lauzen, however, is also looking at running for Kane County Board Chairman. He says he’ll make his announcement at his annual fundraiser on August 13th.

* Meanwhile, state Rep. Karen Yarbrough wants to be slated for countywide office…

State Rep. Karen Yarbrough, whose 7th District includes Forest Park, confirmed that she is planning to run for the Cook County recorder of deeds when the 2012 election rolls around.

Yarbrough told the Forest Park Review on Friday that she is looking to be slated by the Cook County Democratic Party as a candidate for the office, which has been held by Gene Moore since 1999. Yarbrough, a 10-year state representative, sits on the executive board of the county’s Democratic Party; but a party representative would not confirm Yarbrough was being considered.

“It’s certainly a rumor,” said Kelley Quinn, a spokeswoman for the county’s party. “Everybody will be heard and considered.”

Quinn said it was way too early to be thinking about slating and noted the process doesn’t even begin until October. […]

Furthermore, rumors have circulated that Moore will be retiring, although his office did not return calls for confirmation. Yarbough said it was her understanding that he would be leaving the position. His Maywood home is currently under foreclosure and he owes some $78,000 in back payments the Chicago Tribune reported last month.

* I was talking with a Republican last night about the paucity of potentially strong Democratic candidates to run against GOP Congressman Tim Johnson in the newly redrawn 13th District. That the DCCC is apparently recruiting a candidate from tiny Greene County seems a bit odd…

Greene County State’s Attorney MATT GOETTEN is looking at a possible a run for the U.S. House in the new 13th Congressional District, which includes much of Springfield.

Goetten, a Democrat, said he hadn’t been considering a run until he was contacted by someone from the Democratic Congressional Campaign Committee within the last couple of weeks.

Now, said Goetten, 39, of rural Carrollton, “I have been giving it some serious consideration.”

Goetten comes from a politically involved family. A younger brother, BENJAMIN GOETTEN, is Jersey County state’s attorney, and their father, NORB GOETTEN, was not only Greene County state’s attorney from 1972 to 1991, but director of the Illinois State’s Attorneys Appellate Prosecutor from 1991 to 2008. He continues to practice law.

* A Washington Post blogger has christened Congressman Danny Davis’ new district as the “Beavis eating pizza” district…

Heh.

* Related…

* 2nd Illinois congressmen says he’ll vote against debt deal

* WHIP COUNT: House leaders in both parties seek votes to pass debt-limit deal

* Joe Walsh, Jesse Jackson Jr., Luis Gutierrez, Randy Hultgren: On the default deadlocked Congress

* UAW endorses Koehler in 17th District race

* If Yarbrough moves up, area pols line up for 7th District seat - Village commissioner and Proviso school board president

* Redistricting no mystery to General Assembly scientist

19 Comments

Question of the day

Monday, Aug 1, 2011 - Posted by Rich Miller

* From a Pantagraph editorial…

Another day passes; another appointment is made by Gov. Pat Quinn of someone with powerful connections.

The latest appointee to raise eyebrows is Jennifer Burke, who Quinn selected for a seat on the Illinois Pollution Control Board, where she’ll make $117,043. […]

The name “Burke” might sound familiar to those of you who follow Chicago politics. Her father is the powerful Chicago Alderman Ed Burke. That raises the question of whether the daughter of an alderman should be working in a well-paid position for the city, but we suspect he’s not the only alderman with a relative working for the city — and our concern is the state of Illinois. […]

The Friends of Edward M. Burke campaign fund has donated $52,000 to Quinn since he became governor in January 2009 and loaned Quinn’s campaign $200,000 during his race for governor last year. Quinn said the campaign contributions had nothing to do with his decision.

* The Question: Do you think gubernatorial appointments like Burke’s are corrupt, or is the media overreacting? Take the poll and then explain your answer in comments, please. Thanks.

Online Surveys & Market Research

51 Comments

Stermer fined $500 for one tiny infraction

Monday, Aug 1, 2011 - Posted by Rich Miller

* The Executive Ethics Commission has released its ruling on Gov. Pat Quinn’s former chief of staff Jerry Stermer…

A senior adviser to Illinois Gov. Pat Quinn has been fined $500 for sending a political email from a state telephone. […]

Stermer was the Democratic governor’s chief of staff in January 2010 when he reported that he’d sent the questionable emails the previous month.

The commission determined one email from his state phone was to campaign staffers. The other two were sent from a private computer on a Sunday.

One campaign e-mail that Stermer reported himself, not the three that Stermer initially believed. Stermer’s disclosure led to an eight-month investigation by the Office of Executive Inspector General, who looked at every e-mail the guy ever sent. Stermer resigned when the results of the investigation were apparently leaked by an inspector general who was about to be replaced.

I sure hope the OIEG’s office has learned something from this ridiculous case.

6 Comments

CME Group: “Our tax situation is untenable”

Monday, Aug 1, 2011 - Posted by Rich Miller

* This didn’t get a lot of play during my break, but CME Group sure seems to be sounding more serious about moving out of Illinois…

CME Group Inc. is evaluating whether to move some operations to other states from Chicago to reduce its taxes, but it has not decided on an exact timeline, CEO Craig Donohue said Thursday.

“Our tax situation is untenable,” Donohue told Reuters, noting that CME is taxed more heavily than any of its global competitors. The company is talking with at least three states — Texas, Florida and Tennessee — about relocating some of its business to take advantage of lower tax rates there, Donohue said. […]

CME has no specific time frame for moving, Donohue said, and does not plan to shut its Chicago-based trading floor. But he said the possibility of moving other operations is real.

“I don’t think CME group is different from other companies” that relocate to more “hospitable” business environments, he said.

Oy.

19 Comments

Caption contest!

Monday, Aug 1, 2011 - Posted by Rich Miller

* I’m blatantly stealing this idea from Illinois Review….

Winner gets nothing but recognition.

I know I don’t have to say this, but keep it clean, people. Thanks.

93 Comments

Protected: SUBSCRIBERS ONLY - Today’s edition of Capitol Fax (use all CAPS in password)

Monday, Aug 1, 2011 - Posted by Rich Miller

Comments Off

« NEWER POSTS