* The Financial Times (among others) reports that President Obama’s speech tomorrow will include a proposal for increased federal aid to hard-hit state and local budgets…
According to people who have been studying the White House’s possible options, Mr Obama’s proposal is also likely to include measures that would directly boost cash-strapped states and local governments. States and municipalities this year have been forced to slash employees, including public school teachers and police, dragging down national job creation figures. Depending on its structure, an infusion of funds from the federal government could help prevent some of those lay-offs.
* US News & World Report looks at the numbers…
The August jobs report shows that the 17,000 public sector job losses last month completely wiped out the private sector’s 17,000 job gains. Since the end of the recession, government employment–including federal, state, and local jobs–has fallen by roughly 600,000. State and local governments have particularly felt the pain, according to a report released this week by the Census Bureau, which shows that there were over 200,000 fewer state and local government jobs in 2010 than in 2009. Outplacement firm Challenger, Gray, and Christmas also reported this week that, while U.S. layoffs on the whole slowed last month, public-sector layoffs accelerated, from 9,389 in July to 18,426 in August. […]
Behind those government job losses are budget cuts, particularly from states and local governments, many of which have lost revenues as lower incomes and lower property values lead to lower tax income. Those budget cuts mean fewer government contracts, which also leads to pain in the private sector. The winding down of the stimulus package also contributed to these losses, as federal assistance to state governments for things like extra Medicaid funding has disappeared, leaving many states with substantial budget gaps.
* But the National Journal says Obama’s idea is a no-go…
Aid to state and local governments would by far be the most stimulative action, but since that would lead directly to an expansion of government payrolls, it doesn’t have a prayer of passing the House.
…Adding… Roundup…
* Regional superintendents say jobs are necessary
* Illinois Perry, Romney backers clash on Republican primary vote
* IL GOP State Central Committee Meeting: Sound and Fury Signifying No Changes
* Illinois GOP rejects delegate selection plan in victory for Romney
* Illinois Orders Plant in Latino Neighborhood to Curb Emissions
* Will Co. sales tax consultant fights RTA, Chicago suits
* MetroLINK transit facility going up in Rock Island
* Preckwinkle seeks to loosen Cook County purchasing rules
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So, what’s he up to?
Wednesday, Sep 7, 2011 - Posted by Rich Miller
* There are lots and lots of theories about what Gov. Pat Quinn is “really” up to with his threat to close facilities and lay off thousands of state workers. This is the governor’s explanation…
“Our state won’t have enough money to get through the fiscal year, so we have to make reductions,” Quinn said. “I’m prepared to do what has to be done.”
That’s not a new concept. Senate President John Cullerton has been warning about the inadequacies of this budget for months…
“(T)he Senate president has warned for months that there are shortcomings in the current budget that will need to be addressed either during the fall session or early next year,” a statement noted.
And Sen. Gary Forby admitted the GA voted for a flawed plan…
“I knew the money would be short,” Forby said. “We passed a flawed budget.”
But not all Senate Democrats are sending the same message…
Sen. John Sullivan, a member of the Democratic leadership team, denied Quinn’s claim that legislators have given him no choice but to make deep cuts.
“We did not pass the budget with the assumption that it would require layoffs and closures, that’s for certain,” said Sullivan, D-Rushville.
* And not everybody is convinced that Quinn’s threats are completely real. The governor’s credibility being what it is, many have their doubts. For instance…
“That number, I’m sure, is inflated for dramatic affect by the governor,” said State Sen. Matt Murphy (R-Palatine). “What he may be trying to do here is use political pressure to get more support for his $9 billion borrowing plan, which we think is unconscionable.”
Ouch…
“These latest announcements are in the same spirit of former Governor Blagojevich — float some scary scenarios without many details, then take them off the table before they even get any air,” [Sara Wojcicki, spokeswoman for House Minority Leader Tom Cross] said.
* Sen. Bill Brady laid out why so few trust Quinn’s word…
“Once again, Gov. Quinn is betraying the citizens of Illinois and proving that his word is suspect,” Brady said in a prepared statement. “First, he promises to veto any tax hike that raises the income tax more than 33 percent, and he signs a tax increase double the size. He promises in a campaign deal there will be no layoffs or closure of any state facilities, and now we see that he is going back on that agreement with the state’s largest public sector union. He is using state employees as pawns in this political game.”
* So, now what? Some Republicans are open to using “excess” state revenues to keep the facilities open and prevent layoffs, even though the House Speaker and the House GOP Leader have decreed that those revenues should be targeted at overdue state bills…
[Rep. Jim Watson (R-Jacksonville)] said he might be open to using excess revenue to keep facilities open.
“I don’t have a hard-line thing,” he said.
Sen. Larry Bomke, R-Springfield, said Quinn is probably just setting the stage for a vote during the veto session to spend more money.
“He’s right, there isn’t enough money in the budget. I would consider it, but I would want to know what revenue looks like at that point,” Bomke said.
Both of those Republican legislators have lots of state workers in their districts, of course. Democratic state Sen. Mike Jacobs said those districts ought to be targeted…
State Sen. Mike Jacobs, D-East Moline, suggested that Quinn, a Democrat from Chicago, shutter facilities in districts held by GOP lawmakers.
“I would hope that the governor would look at things like who has supported him on key issues,” Jacobs said.
…Adding… I forgot to post this earlier, but it’s well worth a watch. Sens. Donne Trotter and Kirk Dillard were on Chicago Tonight last night to discuss this topic…
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* Illinois Statehouse News outlines the future if Gov. Pat Quinn follows through on his plan to shutter state facilities…
Once Quinn announces what he plans to cut, the State Facilities Closure Act kicks in. He must file an official notice with the Legislature’s Commission on Government Forecasting and Accountability, or COGFA, within two days.
If Quinn targets a prison, school, developmental center or a residential center owned by the state Department of Veterans Affairs, the governor also must submit a plan that details how he will close the facility within 30 days.
Once the governor submits this plan, COGFA will hold at least one public hearing and a 30-day “public comment period.”
After the public hearings and public comment time ends, COGFA then votes on the governor’s recommendation.
It’s unclear if that vote would prevent the governor from acting.
“You would hear strong arguments on both sides,” said COGFA’s revenue manager Jim Muschinske.
* Then there’s the problem of prison overcrowding…
Illinois’ 27 prisons hold about 49,000 inmates, according to the Illinois Department of Corrections. If Quinn closes one of the state’s smaller facilities, each of which hold about 1,200 inmates, those prisoners would have to be housed in other facilities.
Prisons in the state initially were were built to hold 33,373 inmates. Corrections officials, however, switched how they determine that number by counting the number of beds a prison can hold instead of the number of cells. By doing so, the corrections officials could show that the facilities were technically not overcrowded.
Inmates have 34 square feet of living space, or slightly more space that one finds in a typical bathroom, according to the state Department of Corrections. Closing a prison could cause that square footage to get even smaller by putting more prisoners in crowded facilities.
John Maki, executive director of the John Howard Association of Illinois, a prison watchdog group, has toured many of the prisons in the state.
“I don’t see how you close a facility without severely overcrowding the system,” Maki said. “They can keep on putting beds in there, and if that’s their yardstick, they have some more room to go. But in terms of what these prisons were designed to hold, they’re way beyond that.”
* None of these closures will happen overnight. And some of the layoffs might be prevented…
Logistically, any move to close state facilities could easily take a year or longer because the General Assembly strengthened its oversight role after former Gov. Rod Blagojevich’s thwarted attempts to close prisons in Vandalia and Pontiac.
AFSCME also has had success in blocking mass layoffs through the courts. The union convinced a Downstate judge to throw out Quinn’s efforts to lay off 2,600 state workers in 2009.
And…
Quinn’s office must give workers at least 30 days notice of pending layoffs.
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Bad news and some good news
Wednesday, Sep 7, 2011 - Posted by Rich Miller
* Companies that plan to lay off lots of workers are required to notify the state. The most recent report isn’t great…
Nearly 2,300 workers at a dozen companies in Illinois will lose their jobs over the next several weeks, employers informed the state of Illlinois last month.
An August report released by the Illinois Department of Commerce and Economic Opportunity shows that among the job cuts the state was notified of are 628 workers at Chicago Restaurant Partners, 497 workers at UTI Integrated Logistics, a general warehousing and storage company based in Edwardsville; 200 workers at Buske Lines Inc., a general freight trucking company also of Edwardsville; and 194 workers at Lowe’s Home Centers.
* About 800 of those jobs aren’t disappearing forever…
Fortune Brands Inc., for instance, said that technically it is eliminating 81 jobs as part of a reorganization. The company is splitting itself into a liquor company called Beam Inc. and a home/security company called Fortune Brands Home & Security. But a spokesperson said most of the workers, largely corporate staff, have been offered jobs by the Home & Security spinoff.
Likewise, a local joint venture between Chicago-based Levy Restaurants, Phil Stefani Signature Restaurants and Airport Restaurant Management, said it will lay off 628 workers because it recently lost a long-held contract to supply food concession services at McCormick Place convention center.
But Annemarie Strassel, spokesperson for Unite Here Local 1, which represents the workers, said the new contractor, a West Conshohocken, PA-based company called Savor, has agreed to rehire them and assume the contract, which will be renegotiated.
* And not every company has solid layoff plans…
Buske Lines Inc., a trucking company also based in Edwardsville said it will “possibly” lay off 200 workers as a result of a corporate buyout.
* But not all of today’s job news was bad…
Mayor Rahm Emanuel affirmed his commitment to bring more jobs to the Windy City as he joined the head of SeatonCorp in announcing 400 new jobs being created at its Chicago headquarters.
Emanuel said Chicago provides the perfect place for companies to expand and hire more people.
It’s no secret a lot of people are looking for work, but the head of SeatonCorp said the news is not all bad: The company is one of the fastest growing in the country and is adding 400 jobs to its Chicago headquarters.
* Meanwhile, state revenues are up, while federal income is down…
State-source tax revenue grew by more than $530 million last month over August 2010 figures […]
COGFA… reported Tuesday that overall revenue to the state was up 11.3 percent or $223 million last month. But while state-source revenue grew by about 32 percent, federal revenue was down $264 million or 66 percent from a year earlier
Personal income tax revenue grew by 68.2 percent last month and the corporate income tax was up by 93 percent. Both figures are greater than the 67 percent income tax increases enacted in January.
State sales tax revenue also was up by 11.7 percent.
Through two months of the new fiscal year, personal income taxes are up $825 million, sales taxes are up $128 million and corporate income taxes have risen $34 million.
So far, the state is well ahead of its revenue projections for the fiscal year, but it’s far too early to tell how this will all shake out.
The full COGFA report is here.
* Related…
* ComEd takes more heat, lays out improvement plan at Glenview meeting
* Emanuel plans to offer paid maternity leave to city employees
* IDOT reps showcase area road projects
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Yes, I’m alive
Wednesday, Sep 7, 2011 - Posted by Rich Miller
* I wasn’t feeling well this morning. Better now. Back with a post in a few.
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Caption contest!
Wednesday, Sep 7, 2011 - Posted by Rich Miller
* The most recent contest winner is coming over this Friday night for a cookout. Lots of the Illinois “Who’s Who” will also be there. Today’s winner will be offered the same opportunity…
Keep it clean, people. Thanks.
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