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Question of the day

Monday, May 7, 2012 - Posted by Rich Miller

* Yours truly hanging out with Ice T at the Derby (for, like, two minutes)…

* The Question: Caption?

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Monday, May 7, 2012 - Posted by Rich Miller

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Pension dispute boils down to individual vs. collective contract rights

Monday, May 7, 2012 - Posted by Rich Miller

* Greg Hinz gives us the story on what could be a very big disagreement between House Speaker Michael Madigan on one side and Senate President John Cullerton and Gov. Pat Quinn on the other over pension reform

As I reported in my blog on ChicagoBusiness.com last week, the bill at issue dealt only with the Water Reclamation District of Metropolitan Chicago. It would have enacted an agreement between the district and all but one of its unions that called on workers to contribute an additional 3 percent of their salaries to the pension fund and the district to double its contribution from property taxes.

The bill passed the House unanimously—a rarity when it comes to pensions. Since workers still would be getting a defined benefit, albeit one that would cost more, everyone seemed pretty happy.

But when the bill moved to the Senate, Mr. Cullerton claimed sponsorship and moved to amend it. Specifically, he wanted to add a clause allowing workers to stay in the current system without paying that extra 3 percent if they froze their pensions at current levels.

Mr. Cullerton obviously hoped that would be a model in negotiations on restructuring the state’s overall pension systems. The Chicago Democrat, like Gov. Pat Quinn, is a strong believer that pension changes cannot be imposed by fiat but only as part of a negotiated process in which workers have some choice.

Anyhow, Team Cullerton seemed to think it had the green light. They filled me in and re-tweeted an item I did on the president’s “big pension move.” And the chief sponsor of the House bill, Rep. Elaine Nekritz, D-Northbrook, told me she was OK with the change.

Then Mr. Cullerton abruptly yanked his own amendment. His folks make it pretty clear that was done at the request of Mr. Madigan. Indeed, Madigan spokesman Steve Brown effectively confirmed that, telling me, “I think the speaker felt the bill was fine as it passed the House.”

What’s not clear as of this writing is whether Mr. Madigan pulled out the rug unfairly at the last second, or whether Mr. Cullerton got a little ahead of things. Different sources are giving me different answers.

* More details from Chris Wetterich

But the two Chicago Democrats see the water reclamation district plan in different ways — Madigan believes changes can be imposed after negotiating with unions, while Cullerton thinks all employees have to be offered a choice.

Cullerton wants to let workers decide between an altered pension, which would cost the employee more but be better funded, and the current system, which would cost workers the same but could have other consequences, such as not having future raises counted when pensions are calculated.

The concept is called “consideration” by Cullerton and the Senate Democrats’ legal counsel, Eric Madiar.

The choice would apply to all public employees, not just those in unions. The state constitution makes public employee pensions a contractual right regardless of whether an employee participates in collective bargaining.

Cullerton and Madiar contend that simply negotiating with unions won’t be enough for any legislation to comply with the state constitution’s language. Late last month, after proposing a plan that follows the Cullerton-Madiar structure, Gov. Pat Quinn said he also believes that simply negotiating with the unions won’t pass constitutional muster.

In the case of the water reclamation district, only about 800 of the 2,000 employees are unionized.

I think Cullerton probably has the right idea here. How can unions negotiate pension changes for systems with lots of people who aren’t union members?

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Deja vu all over again

Monday, May 7, 2012 - Posted by Rich Miller

* My weekly syndicated newspaper column

Call it “Blagojevich Lite” or whatever you want, but it became pretty clear last week that state Rep. Derrick Smith’s attorneys are planning the same sort of mockery of the system that Rod Blagojevich’s legal team did during those dark days after the former governor’s arrest.

“While I have been troubled to experience the shenanigans being played by the FBI, to lean on people around me and to get them to say bad things about me, I will not cower,” Smith (D-Chicago) told reporters after he pleaded not guilty to federal bribery charges.

Never mind the fact that nowhere in the arrest report or federal indictment is there any reference to anybody saying “bad things” about him. Smith is accused of taking a $7,000 bribe to help get a state grant for a day care operator, a business that was a creation of federal agents.

Smith also claimed that the people of his district “elected” him on March 20 because “they believed in me.” Yeah. Right. OK.

The voters gave him the Democratic nomination on March 20 despite the fact that he had been charged because party leaders warned them that Smith was up against a white, conservative Republican activist who was posing as a black Democrat. Many of those same Democratic leaders are now calling for Smith’s resignation.

Smith’s pledge to never “cower” in the face of the federal prosecution was right out of Blagojevich’s defiant playbook. Blagojevich loudly declared his complete innocence, vowed to fight to the end, said he had been persecuted by the feds and once even challenged the U.S. attorney to a manliness contest.

Right up until he checked himself into federal prison to serve a 14-year term, Blagojevich said the feds had the wrong guy. Smith, by the way, is now looking at 10 years in a federal penitentiary.

But it was one of Smith’s attorneys, Victor Henderson, who really brought the former governor to mind with his remarks.

Henderson told reporters that Smith had been entrapped, but the lawyer’s evidence of this entrapment was an allegedly phony government website and a fictitious day care center operator. That’s hardly proof of entrapment. Actually, it’s standard stuff for a federal sting operation.

And doesn’t claiming that Smith was entrapped into accepting a $7,000 bribe mean Smith and his lawyers are all but admitting that he took the money? And if he did take the cash, isn’t that enough right there to expel him from office?

The House doesn’t have to consider whether or not Smith is guilty under state or federal criminal statutes. This is not about criminality. It’s about politics.

Under its rules, the House merely has to establish “disorderly behavior” by the offending member. That isn’t a very high bar. Theoretically, the House could expel a member for spitting on the sidewalk if two-thirds of the members so voted.

Henderson did make a good point about the FBI failing to inform a judge of its informant’s extensive criminal record. And he gave the strongest indication yet that he planned to disrupt and distract the process from beginning to end when he quoted anti-Nazi Lutheran Pastor Martin Niemoller’s immortal poem about moral cowardice during the Holocaust.

“First they came for the socialists, and I did not speak out because I was not a socialist. Then they came for the trade unionists, and I did not speak out because I was not a trade unionist. Then they came for the Jews, and I did not speak out because I am not a Jew. Then they came for me, and there was no one left to speak to, for me.”

“Today it’s Derrick Smith,” Henderson told reporters, according to Chicago Public Radio. “Who is it tomorrow?”

Needless to say, invoking the Holocaust to defend a client accused of taking a cash bribe is more than a bit much.

But now that the House Special Investigating Committee has allowed Smith and his legal team more than enough time to get their feet underneath them by continually postponing the inevitable, we can probably expect a lot more crud such as this.

Henderson told Illinois Issues magazine that his client plans to testify at future House hearings. The next one is scheduled for May 10.

If Henderson was telling the truth about Smith testifying, we can all expect an embarrassing circus.

* Henderson is also raising expectations of incredible new evidence that will clear his client’s name. Sound familiar? It should

Henderson accused the FBI of targeting his client because allegedly he would not supply information about Jesse White and other prominent Illinois public officials.

Henderson declined to provide details about what information the FBI allegedly sought. Druker strongly refuted Henderson’s charges, responding “the focus here is Derrick Smith and not Jesse White. These are just desperate charges.”

“There are going to be some developments that will begin to unfold in the next few days,” Henderson insisted. Smith has pled not guilty and appeared in court on April 30.

At one time, Blagojevich also hinted that the feds were after information about Barack Obama. That was just another of his lies.

* And Mark Brown has some news

A group of Democratic ward committeemen met behind closed doors Friday in search of a strategy to clean up the Derrick Smith mess. […]

An hour or so later, Secretary of State Jesse White, whose support of Smith was key to his earlier selection, emerged to say the group had developed a plan to either replace or defeat the accused lawmaker.

White said a delegation would be sent to speak directly with Smith to ask him to give up the Democratic nomination he won in the March primary. Smith’s victory came only after party leaders stepped in to keep the seat from falling into the hands of his opponent, the former executive director of the Cook County Republican Party.

Ald. Jason Ervin (28th) and Rep. Karen Yarbrough (D-Maywood) will be the official emissaries, White said. […]

If the diplomatic efforts fail, White said Democratic leaders resolved to field a third-party candidate to defeat Smith in November.

Thoughts?

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Fun with numbers

Monday, May 7, 2012 - Posted by Rich Miller

* From the Tribune we find a story about the company which manages the state Lottery

Northstar Lottery Group — which took charge of daily operations July 1, a few days after the Illinois auditor general blasted the selection process — promised to boost revenue by more than $100 million.

While the dollars are indeed up, they are expected to fall $55 million short of their projections, renewing criticism from those who had opposed the deal.

* The company promised $825 million in total revenues. It’s on track to bring in $770 million. That may actually be a $100 million increase, as you’ll find if you read way down deep into the article explains…

Northstar said several factors led to the lowered forecast, chief among them the fact that the lottery’s revenue for the previous fiscal year was about $668 million, not the $712 million the state anticipated.

But, as the article notes, the Lottery claims it transfered $690 million last fiscal year to the state budget. Nobody could explain the discrepancy.

Northstar has to meet a specific goal or it’ll be fined. According to the Trib, if the company hits the $770 million projection, it would owe nearly $11 million in penalties

In a move aimed at avoiding possible penalties, Northstar wants the state to lower the goals.

Officials with Northstar and the Illinois Lottery refused to discuss what new revenue targets the company is seeking through arbitration.

What we really need here are the real numbers. The Lottery needs to start sharing. Pronto.

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Man bites dog

Monday, May 7, 2012 - Posted by Rich Miller

* Rare is the day when the Chicago Tribune editorial page blasts Republican state legislators on the budget, but today is that day

Patricia Bellock, Michael Frerichs, Raymond Poe, you are part of the problem.

Suzi Schmidt, Dave Syverson,you are not far behind.

They are all members of the Illinois House or Senate. They sit on the Commission on Government Forecasting and Accountability. Last week, they reviewed Gov.Pat Quinn’splan to close government facilities around the state.

Illinois has no money. It has to stop spending wherever it can. The governor has made some tough choices.

The commission voted on closing six major facilities the governor wants to close. The commission went 0 for 6.

House Republicans Bellock and Poe and Senate Democrat Frerichs didn’t vote to close one major facility.

Senate Republicans Schmidt and Syverson voted to close only one.

Look, there are plenty of really good reasons not to close some of those facilities. I even agree with some of them, disagree with others. There are decent arguments against closing all of them. For instance, this is from a Treasurer Dan Rutherford op-ed in the very same Tribune

I would prefer a long-range strategic plan before the state closes any of its mental health or correctional facilities

Legislating ain’t always easy, especially in times like these. But there are folks who talk a good game about cutting the budget and then won’t follow through.

* The Trib’s closer…

It’s time for Republicans to get in the game. You want more cuts in Medicaid than the governor has proposed? Put ‘em on the table. You want to spare local schools from pension costs — where’s your better idea? You don’t want to close a costly prison? Then name another state operation you will shut down tomorrow.

Step up.

Hard to argue with that.

* Other stuff…

* DNR hopes to create ’sustainable’ funding support for outdoors programs

* Editorial: Illinois Senate finally gives up scholarships

* Marin: Oh, the pain of giving up a perk

* Editorial: At last, a victory for common sense

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Cutting Medicaid ain’t easy, Part 9,257

Monday, May 7, 2012 - Posted by Rich Miller

* The Associated Press looks into “cutting fraud” as the answer to solving a big portion of Illinois’ Medicaid funding woes

Sen. Kirk Dillard, R-Hinsdale, has argued for years that much of Illinois’ Medicaid problem could be solved by rooting out waste and abuse. He says experts believe 10 percent of Medicaid money is spent improperly, which would amount to nearly $1.5 billion in Illinois.

Unfortunately, there’s little evidence to support that claim.

Dillard attributes the figure to the New York Times. He doesn’t specify, but he may be referring to a series of stories in 2005 on fraud in the New York state Medicaid program. The 10 percent figure popped up for two different kinds of fraud and abuse. One was an estimate of the problem in New York’s badly run Medicaid program, and the other was an estimate of losses in all health care nationwide, not just Medicaid.

Neither figure says anything about fraud and abuse in the average state Medicaid program.

A 2010 report by the National Health Care Anti-Fraud Association said a conservative estimate of fraud in the nation’s total health spending _ not Medicaid alone _ would be 3 percent, although it also noted the FBI had put the rate at somewhere between 3 percent and 10 percent. A spokesman for the group recently put national fraud loss at “tens of billions of dollars” but wouldn’t be any more specific.

The Illinois Department of Healthcare and Family Services says it’s not aware of any 10 percent fraud estimate and doesn’t consider it to be accurate. The department’s fraud recovery each year amounts to tens of millions of dollars _ nothing close to the hundreds of millions that Dillard envisions.

Discuss.

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Monday, May 7, 2012 - Posted by Rich Miller

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

Monday, May 7, 2012 - Posted by Rich Miller

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« NEWER POSTS PREVIOUS POSTS »
* Reader comments closed for the holiday weekend
* Isabel’s afternoon roundup
* Jack Conaty
* New state law to be tested by Will County case
* Why did ACLU Illinois staffers picket the organization this week?
* Hopefully, IDHS will figure this out soon
* Pete Townshend he ain't /s
* Open thread
* Isabel’s morning briefing
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