But she’s here to teach everyone else
Monday, Apr 7, 2014 - Posted by Rich Miller
* This is a big reason why Rep. Jeanne Ives (R-Wheaton) hasn’t yet passed a single bill. From Illinois Review…
A property tax relief bill that passed the Illinois House last week remains a topic of discussion among Republicans that voted against it. State Rep. David McSweeney’s (R-Barrington) legislation places a one year restriction on the ability to levy general revenue budgets on a specific list of small townships in specific Chicago area counties. […]
Speculation is that McSweeney folded into the bill specific demands by Speaker Madigan, which were intended to blunt crticism of key Democrat lawmakers. […]
“We need tax relief that applies across the board,” Ives told Illinois Review. “Rep. McSweeney’s bill applies to the smaller population townships, and not across the state. And the bill could save affected taxpayers only $1.00 and it would be for just for one year.” […]
As the bill moved along in the process, Rep. McSweeney made changes or promises of change that eliminated more and more townships from being under the tax levy restriction. After removing the bill from the House agenda on March 6th, McSweeney withheld any activity on the bill until the day after the party primaries, when he amended the bill to exempt five other townships, including Orland, Bloom, Rich, Stickney, and Calumet in the south suburbs. […]
“Unfortunately, it was a bad bill,” Rep. Ives said. “It implemented the property tax freeze for only one year. Property tax freezes remove local control of property taxes and hand it to the state. The better way to reduce property taxes at the state level is to reduce or eliminate unfunded mandates.”
* Yeah, it was a small bill that didn’t provide more than a speck of property tax relief, but it got a big camel nose under the tent. You pass this one, then maybe other townships are forced to follow. Who knows where it could stop?
Also, publicly blasting a fellow conservative Republican for working with the majority to pass a tax relief bill is kinda goofy and bad form.
Not to mention that Ives appeared to be on several sides of the issue. It’s too narrow, my constituents who aren’t getting it will complain. It doesn’t last long enough, freezes aren’t the way to go.
Please, pick a lane.
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Question of the day II
Monday, Apr 7, 2014 - Posted by Rich Miller
* Today’s question is more of a caption contest, so let’s do a serious one now. The Daily Herald has a story on the Northeastern Illinois Public Transit Task Force report from last week…
“Hiring based on political considerations is corrosive to good government,” the task force stated.
The report also focused on the RTA, refuting advice from Chairman John Gates to give the agency greater authority over the CTA, Metra and Pace.
Task force members pointed out hiring Madigan’s son-in-law Jordan Matyas in 2011 as an RTA lobbyist and later chief of staff at a time when there was talk in Springfield of abolishing the agency.
“We cannot credibly vouch … that the answer to decades of patronage that involved dozens of officials from both parties is to place (Metra) under the more rigorous oversight of an agency who chose to select the speaker’s son-in-law as chief lobbyist,” the task force concluded.
Ouch.
Former US Attorney Patrick Fitzgerald was the task force’s ethics chairman. Fitzgerald has never been a big MJM fan, to say the least.
* Gates responded…
Asked about the harsh task force language concerning the RTA, Gates said, “It was a really cheap shot.”
He insisted Matyas was selected months after a bill was defeated that would have given the governor appointing authority over the RTA chair.
Matyas “came in through the front door,” was one of at least two candidates he interviewed and “ has done a terrific job,” Gates told reporters after an address to the City Club of Chicago.
* The Question: “Hiring based on political considerations is corrosive to good government.” Agree or disagree? Take the poll and then explain your answer in comments, please.
survey tool
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Fun with numbers and facts
Monday, Apr 7, 2014 - Posted by Rich Miller
* “State’s big payout from video gaming still less than predicted” was a recent Sun-Times headline.
Well, yeah, there’s a reason for that. Chicago hasn’t opted into video gaming. Otherwise, the machines are doing pretty well…
State officials predicted each machine would net between $70 and $90 in revenue every day. The average so far is $94, records show.
By the way, Gov. Quinn said today that he thinks “we’re moving the right direction” on some gaming reforms he’s demanding before Chicago can have a casino.
* And speaking of Gov. Quinn…
[Gov. Pat Quinn] was asked about his opponent Bruce Rauner’s contention that Indiana is thriving as a state, more so than Illinois.
“I don’t think anyone can compare to Illinois when it comes to investing in roads,” Quinn said. “We are the best. I think our businesses understand that in order to do business in the world economy you’ve got to have good transportation.”
Then Quinn slammed Illinois’ neighbor for how it dealt with brutal weather conditions over the past winter.
“With respect to Indiana, I saw that I-65 was closed down for a couple of days during the severe winter,” Quinn said. “We don’t close down roads in Illinois.”
* Umm. From a January 6, 2014 IDOT press release…
Dangerous Weather Force Road Closures Statewide; Motorists Still Urged to Stay Off Roads in Some Areas
Black Ice a Major Concern Due to Freezing Cold Temperatures
CHICAGO – The Illinois Department of Transportation (IDOT) announced today that motorists should be mindful of dangerous road conditions and black ice on roadways in areas throughout Illinois. Motorists are also encouraged to stay home and avoid travel until roads are safe. For those who have to travel, check www.gettingaroundillinois.com for the latest road closures and road conditions. Currently, dozens of Illinois roads statewide are closed due to snow and ice. [Emphasis added.]
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The Vallas front
Monday, Apr 7, 2014 - Posted by Rich Miller
* The Sun-Times reports that Gov. Pat Quinn’s running mate Paul Vallas thinks Republican Bruce Rauner’s term limits proposal will survive challengers and make it onto the ballot…
The former Chicago Public Schools CEO also said the proposed term-limit referendum has a good chance of landing on the November ballot, and of being approved by voters.
That’s how he said he would place his bet — if he were a betting person.
“I’m not a betting person, unfortunately,” Vallas said.
* Vallas also said he was against House Speaker Michael Madigan’s idea to make local school districts start paying for teacher pensions…
“I don’t support that at all,” said Vallas, former Chicago Public Schools CEO.
Chicago schools already pay the employers’ share of teachers’ pension costs, but suburban and downstate schools don’t. Making the change has been pushed hard by House Speaker Michael Madigan but hasn’t found traction in Springfield as suburban and downstate Republicans in particular have feared loading more costs onto already cash-strapped school districts.
“For every rich district that can afford it, there’s a poor district that can’t,” Vallas said.
* In other news…
Paul Vallas, Gov. Pat Quinn’s running mate has been hired by DSI Civic Financial Restructuring firm, whose president and CEO, Bill Brandt, donated $100,000 to the Quinn campaign last Dec. 31—a move that may well trigger some political ripples in the heated governors race.
Brandt, who is also chairman of the Illinois Finance Authority, a non-paid position, told me Vallas would not be working on any Illinois deals and will be a salaried employee. With Brandt on the IFA, the firm had not been “seeking” or “working on” Illinois business. […]
In a release, DSI, based in Chicago with offices in other cities, said Vallas “brings a solid grasp of state and municipal issues that complement the senior management team” of DSI.
DSI said in its release its built a wall around Vallas to avoid conflicts and his “practice will adhere to the firm’s present policy of only working on out-of-state projects. These protocols preclude DSI Civic from seeking or working on distressed municipal matters, or with troubled governmental units, within the state of Illinois, and have long been in place due to Mr. Brandt’s position as Chairman of the Illinois Finance Authority, as well as John Filan’s former role of COO of the State. “
Since they’re not getting state business anyway, it’s probably no big deal, other than it sure looks like another business as usual hire.
…Adding… Rauner campaign’s response…
“Paul Vallas just helped Pat Quinn complete the transformation from self-styled reformer to another back-scratching Illinois politician in record time,” Rauner spokesman Mike Schrimpf told Early & Often. “Over the last five years, Pat Quinn has given special deals and appointments to Brandt and Filan. Now, they’re returning the favor in a Blagojevich-style move.”
* So, if you’re keeping score, that’s one comment in favor of Bruce Rauner, one comment opposing Speaker Madigan and a sweet insider job.
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* Despite some media attempts to blame the stall of Rahm Emanuel’s pension proposal on mysterious behind the scenes maneuvering, sometimes a cigar is just a cigar, especially when it involves a property tax hike…
Gov. Pat Quinn on Monday made clear he’s not on board with Mayor Rahm Emanuel’s proposal to hike property taxes as a way to solve a looming pension crisis in the City of Chicago.
In a news conference today on the Near West Side, Quinn repeatedly referred to Emanuel’s plan as only a “sketch” but said he would not back a plan that relied heavily on property tax hikes.
“What I saw last week wasn’t a plan, it was a sketch,” Quinn said. “It was a sketch that would relegate property owners in Chicago, families and businesses to a future of higher and higher property taxes. I don’t think that’s a good way to go.”
“They’ve got to come up with a much better, comprehensive approach to deal with this issue,” Quinn continued. “But if they think they’re just going to gouge property tax payers, no can do. We’re not gonna go that way.”
I’m told we can expect another amendment soon, perhaps today, that will strip out the property tax language. Nothing has surfaced yet as I write this, however.
…Adding… They mayor tries to dodge responsibility for the language…
“We finally have a model that brings both reform and revenue together,” Emanuel said at an unrelated news conference when asked whether state lawmakers can be spared having to vote on a version with the property tax language in it. “It was never anyone’s intention to have Springfield deal with that. That’s our responsibility. But I do believe, to actually give the 61,000 workers and retirees the certainty they deserve, you need reform and revenue. And we’ll deal with our responsibility.”
“We will work through the issues,” he said when asked again whether he’s willing to take the tax language out of the state bill.
* Meanwhile…
A leading credit rating agency has called legislation to overhaul to Chicago’s pension funds a “positive development” but says it won’t solve all the city’s problems.
The analysis by Moody’s Investor Service was released Monday. It says the proposal is “modestly credit positive” because it tackles the city’s massive and growing underfunded pension liabilities.
* But…
…Moody’s continues, the proposal calls for hitting a funding target of 90 percent in the city’s municipal and laborers’ retirement system in 40 years, not the normal 30 years that actuaries recommend. Because of that and other factors, unfunded liability in the two pension funds, which Moody’s sets at $13.8 billion in 2012, would resume rising after a brief dip. While the unfunded liability eventually would drop if plan assumptions are met, “if annual investment returns fall short of the assumed 7.5 percent, the risk of plan insolvency may well reappear.”
Moreover, Moody’s adds in what definitely is a gray-Monday report, “the proposal does not address” a shortfall in police and fire funds for which the city faces a $600 million increase in contributions next year under current state law.
Despite all those sour words, Moody’s, which rates city debt Baa1 with a negative outlook, just a couple of levels above junk, terms Mr. Emanuel’s proposal “modestly credit positive.” But Moody’s says that “even with reform, pensions will continue to weigh heavily on Chicago’s credit quality.”
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Question of the day
Monday, Apr 7, 2014 - Posted by Rich Miller
* As I told you last week, our famed commenter Oswego Willy was at the Cubs home opener. He sent along a photo posing with Tom Ricketts himself…
Yep. That’s exactly what OW looks like.
* The Question: Caption?
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The bureaucratic mindset
Monday, Apr 7, 2014 - Posted by Rich Miller
* The Sun-Times and the Medill Data Project compared charter schools in Chicago to Chicago neighborhood schools…
◆ On the math portion of the Illinois Standards Achievement Test, 7.3 percent of CPS neighborhood school students exceeded standards, while 5.3 percent of kids at the privately run schools did so.
◆ Among charter or contract elementary students, 7.9 percent exceeded standards on the ISAT for reading, compared with 9.8 percent of students at neighborhood schools. The ISAT in math and reading is given to third- through eighth-graders.
◆ Neighborhood and privately run high schools both saw just 1.6 percent of their students exceeding standards for reading on the Prairie State Achievement Examination, which is given to high school juniors.
◆ Charters and contract schools edged out neighborhood high schools — 1.3 percent to 0.7 percent — when it came to exceeding standards on the math portion of the PSAE last year.
Obviously, there’s very little difference here, which will cause some to scream “Then why do we need charter schools at all?”
I make no apologies for disliking the industrial education model. I prefer choice. I think people ought to have choices.
And, like with neighborhood schools, not all charter schools are meh. Some are quite good. Sometimes, experiments fail. We shouldn’t be afraid to experiment. What’s needed is an overall improvement in all schools.
* But not like this…
“Our top priority is ensuring our students graduate 100 percent college-ready and 100 percent college-bound,” [Barbara Byrd-Bennett, Mayor Emanuel’s schools chief executive] said.
First of all, that’s just not true or else lots, lots more would be done to improve the schools. Secondly, this over-emphasis on taking tests (with the resultant uproar over what are likely quite meaningless results) and driving kids to attend college is philosophically wrong-headed, whether in Chicago or the suburbs or Downstate.
* Don’t get me wrong here. I do not think kids should be discouraged from attending college, but why saddle a student with tens of thousands of dollars of debt just for the sake of having a so-so degree from a so-so university?
Why not foster the development of more high schools, charter or otherwise, that focus on tech/trade careers? Do you know how much operating engineers make?
* When a system’s entire focus is “100 percent college-bound” you’re not giving students nearly enough choices. Period.
Chicago has dropped its “zero tolerance” rules for those who cause a bit of trouble at schools. They realized that treating everybody and every incident the same was doing more harm than good. Schools do this all or nothing stuff way too much, and it always, always backfires.
Teach them to be good citizens. Teach them how to comprehend language and to do math. But give them choices in how to get there.
/rant
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A tough nut to crack
Monday, Apr 7, 2014 - Posted by Rich Miller
* From a press release by the Pension Fairness for Illinois Communities Coalition, which is a group of mayors demanding pension benefit reductions for police and firefighters…
According to a 2013 study by the bipartisan Commission of Government Forecasting and Accountability (COGFA), unfunded liabilities for police and fire pension funds statewide have “skyrocketed eight-fold” since 1991, growing from $953 million to $7.58 billion by 2010. This dramatic increase has occurred despite taxpayer contributions growing nearly four-fold since 2000 ($172.1 million to $629.2 million) according to Illinois Department of Insurance data. […]
It’s not hard to see how costs add up and strain municipal budgets as years of overly generous benefit increases have also led to the instability of public safety pension funds. Those added benefits received approval but municipalities were never provided additional funding to adequately cover the increased costs.
For instance, in Illinois, police officers and firefighters can retire at age 50, and collect up to 75 percent of their earnings with a 3 percent annual compounded cost-of-living increase, for the rest of his or her life. Furthermore, surviving spouses will continue to receive 100 percent of the pension benefit for the rest of their life beyond that.
In addition, the state has a remarkable 660 individual police and fire pension boards with a total of 3,300 trustees, the most of any state. These pension boards, comprised of a majority representing public safety employees with limited professional expertise to oversee investments, provide little – if any – accountability for taxpayers, which leads to inefficiencies when it comes to managing a combined $10.7 billion in assets.
* From the SJ-R…
With a population of nearly 200,000 and a booming Hispanic population, Aurora is now the state’s second largest city. It faces a required increase of more than $1 million into the police and fire pension funds each year for the next 25 years.
The city has $220 million in unfunded debt between the two funds but also has one of the better funding levels at around 60 percent. Nonetheless, Weisner said it means they have not been able to hire new police and firefighters and have laid off some city workers.
“Without some reform there’s going to be cities that basically, I believe, will be going under,” he said.
* But this headline is right below that story in the SJ-R…
Springfield firefighters scramble to battle 3 fires in hour’s time
If you thought passing pension reform over the objections of AFSCME and the teachers was tough, you ain’t seen nothing until you try to defeat the firefighters. They are well organized and hugely popular with the public.
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Is she really a Democrat?
Monday, Apr 7, 2014 - Posted by Rich Miller
* Rick Pearson at the Tribune takes a look at the claim made by Bruce Rauner’s wife Diana that she’s a Democrat…
Since 1995, 77 percent of the more than $500,000 she’s given has gone to Republican candidates and causes, federal and state records show. […]
But state campaign finance records show that since 2009, when Bruce Rauner first contemplated and then rejected making a 2010 bid for governor, Diana Rauner made $238,150 in political donations, with 91 percent going to GOP candidates or conservative groups.
Among federal donations during that time frame, Diana Rauner gave $158,800 to candidates and committees, with 98 percent to Republicans. Several of the donations occurred when Bruce Rauner gave similar-size contributions to the same candidates.
* The Rauner campaign’s response…
spokesman Mike Schrimpf said Diana Rauner “voted Democrat throughout the last decade and every time for Barack Obama” on the statewide ballot.
“If that doesn’t make you a Democrat, I don’t know what does,” Schrimpf said in a statement.
Except she didn’t vote in the 2012 primary, when Obama ran for reelection and she contributed to three GOP presidential candidates, including Mitt Romney. She also didn’t vote in the 2010 primary, the last time Gov. Pat Quinn faced voters.
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* Senate Bill 3411 was introduced in mid February. From its synopsis…
Provides that a county or municipality may not require a law enforcement officer to issue a specific number of citations or warnings within a designated period of time. Provides that a county or municipality may not, for purposes of evaluating a law enforcement officer’s job performance, compare the number of citations or warnings issued by the law enforcement officer to the number of citations or warnings issued by any other law enforcement officer who has similar job duties.
* The bill has eleven bipartisan co-sponsors (including Sen. Kirk Dillard), but the Illinois Association of Chiefs of Police pushed back hard…
The Illinois Association of Chiefs of Police is concerned about the negative impact on public safety that is likely to result if Illinois Senate Bill 3411 (SB 3411) is passed. While law enforcement executives strongly agree with eliminating the imposition of arbitrary traffic ticket quotas, the bill would also eliminate vital data-driven performance measures used to assist in the performance appraisal of police officers. Under the provisions of this bill, Illinois would stand to lose millions of dollars in federal highway traffic safety funding for DUI saturation patrols, restraint enforcement details and speed reduction campaigns.
If the bill passes, for example, an officer who refuses to make DUI arrests or who doesn’t write a ticket to a motorist for passing a stopped school bus could not be disciplined or have it documented in their performance evaluation. SB 3411 would intrude on the management rights of local law enforcement executives to decide what is in their communities’ best interests. Police Chiefs would lose their means to properly supervise officers using objective data that demonstrates that officers are meeting the expectations set by our communities.
* So an amendment was filed. The amendment expands the idea to the Illinois State Police and the state Conservation Police and adds this language which appears to address at least some of the chiefs’ complaints…
This [ticket quota] prohibition shall not affect the conditions of any federal or State grants or funds awarded to the municipality and used to fund traffic enforcement programs. […]
Nothing in this Section shall prohibit a municipality from evaluating a police officer based on the police officer’s points of contact.
For the purposes of this Section, “points of contact” means any quantifiable contact made in the furtherance of the police officer’s duties including, but not limited to, the number of traffic stops completed, arrests, written warnings, and crime prevention measures. Points of contact shall not include either the issuance of citations or the number of citations issued by a police officer.
Thoughts?
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Driving turnout
Monday, Apr 7, 2014 - Posted by Rich Miller
* My weekly syndicated newspaper column…
Worries about low Democratic turnout in an off-year election for an unpopular governor and Republican gubernatorial candidate Bruce Rauner’s millions in campaign spending are obviously driving driving much of Illinois House Speaker Michael Madigan’s personal legislative agenda this year.
“If you’re an African-American on the South Side, what motivates you to vote for Pat Quinn when you wake up election morning?” was the blunt assessment of one longtime Madigan associate last week.
For example, Madigan signaled last week that despite his past reluctance to raise the minimum wage and longtime alliance with the Illinois Retail Merchants Association (which is leading the charge against it), he’s not opposed. Calling the idea a matter of “fairness” and “equity,” Madigan told reporters last week “I think you’ll find the opposition to raising the minimum wage comes from people that have done pretty well in America, and for some strange reason they don’t want others in America to participate in prosperity.”
Asked if he was referring to Rauner, Madigan asked “Who?”
Rauner claims to support an increase in the state’s minimum wage if it’s tied to business reforms, but Rauner previously “adamantly” opposed raising the wage and even once said he’d favor cutting it by a dollar an hour, to match the national minimum.
Madigan made his comments shortly after the House Judiciary Committee unanimously approved Madigan’s constitutional amendment to bar anyone being denied the right to register to vote and to vote based on race, gender, sexual orientation, income, national origin or religion.
Several Republican states have attempted to suppress Democratic turnout by requiring voters to produce a government ID before casting their ballots. “According to the Brennan Center,” Madigan told the committee last week, “approximately 25 percent of eligible African-Americans and 16 percent of Hispanics don’t have photo IDs.” That’s probably the first time that the Speaker has ever publicly referenced the liberal group.
Madigan’s proposal passed unanimously, despite some misgivings by Republicans. One GOP member of the committee, Rep. Dwight Kay, is actually sponsoring legislation to require voter identification this year, but he did not oppose Madigan’s measure.
And the Speaker’s proposed constitutional amendment to place a three percent surcharge on income over $1 million retroactive to this past January 1st was moved forward on the House floor last week. No Republicans have yet to emerge as supporters, so Madigan will likely need all 71 of his members to pass the proposal, which requires a three-fifths super majority.
According to numerous sources, Madigan’s leftward lurch toward Gov. Quinn took Rauner and his GOP campaign by surprise. They believed that Rauner’s personal relationship with the Speaker over the past few years would help salve the wounds and that the old school politician Madigan would understand the necessities of politics. Instead, Madigan apparently took great offense at the constant attacks (at one point, Rauner vowed to “go after” Madigan’s friends and allies to get at the Speaker), and the overwhelmingly negative reaction among trade unions to Rauner’s harsh anti-union rhetoric has only fueled the Speaker’s resolve.
Madigan has long been known as a politician who prizes pragmatism above ideology, but he’s been about as loyal an ally to the trade unions as anyone in Illinois history. Even that’s not solely about ideology, however. Those unions provide a lot of money and foot soldiers to Madigan’s organization.
Rauner also apparently didn’t use a back door channel to Madigan during the primary, which meant there was little to no ongoing communication between the men. Things obviously got out of control.
Madigan’s moves have definitely not gone unnoticed by Rauner. Behind the scenes, some are saying that Rauner will counter this by contributing big bucks to House Republican coffers.
That doesn’t seem to concern the Madigan folks. The Democratic legislative district map is pretty darned solid (as I reported in a recent Crain’s Chicago Business column, in 2012, House Democratic candidates received 53 percent of all the votes cast in all House races statewide, yet they won 60 percent of the House races), and they’ve been successfully fending off the House Republicans for years.
But Madigan’s poll numbers aren’t good at all, to put it mildly, so there are plenty of other weapons in Rauner’s arsenal. This could very well escalate into an all-out war. And Rauner has the bucks to do it.
Discuss.
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Reader comments closed for the weekend
Friday, Apr 4, 2014 - Posted by Rich Miller
* I bumped into Rep. Chad Hays last night and he told me about a new music festival that’ll be held this September 11-14 near Danville at the 3,000 acre Kennekuk County Park.
The promoters of the Phases of the Moon Festival are spending seriously big bucks to bring in Bob Weir and Rat Dog, Widespread Panic, Tedeschi Trucks Band, Leon Russell, Gov’t. Mule, the Chris Robinson Brotherhood and many, many, many more. And this list is just the first round of announcements. I’m told even more announcements are on the way.
I’m so there. Peoria has a similar event, but it’s always during session, so I can’t go. This one is not to be missed.
* Tedeschi Trucks will play us out…
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Julie Brady
Friday, Apr 4, 2014 - Posted by Rich Miller
* I didn’t know her, but everyone who did said she was a fantastic woman and a great mother. My deepest condolences to the family…
In a sad note amid this political season, I have to report the death of Julie Brady, wife of former Illinois GOP Chairman Pat Brady.
Ms. Brady, the former Julie Blink, was 51, and died after a lengthy illness. A graduate of the University of Wisconsin Law School, she met her husband while both were working for the U.S. Department of Justice.
“She was an honors graduate,” Mr. Brady told me today in a brief phone conversation. “She was honors in everything.”
Ms. Brady’s illness began before and continued through the flap over Mr. Brady’s decision to publicly endorse legal marriage in Illinois — a decision that eventually resulted in his ouster as chairman.
Visitation and services will be Monday at St. Patrick’s Parish, 115 N. Fourth St., St Charles. Survivors include four children.
Word of her death emerged in a note from Mr. Brady’s successor as chairman, Jack Dorgan. GOP gubernatorial nominee Bruce Rauner released a statement terming Ms. Brady “a remarkable woman who cared passionately about Illinois and our children.”
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* From a Pat Quinn budget office press release…
Two bond rating agencies have released their reviews of Illinois’ finances ahead of next week’s scheduled sale of $250 million in General Obligation bonds that will finance roads, bridges and schools around the state.
While they say the state still has much work to do, they note the hard work the state government has done to cut costs, pay down old bills, and pass a comprehensive pension reform plan.
“We are pleased that the bond rating agencies recognize the difficult work the Governor and the General Assembly have done to cut spending, pay down the bills and pass comprehensive pension reform,” Acting Budget Director Jerry Stermer said. “It’s clear the rating agencies agree the Governor’s proposed budget would bring long-term fiscal stability to Illinois.”
* Not everything the raters had to say was positive, but considering how New York has trashed us in the past, I suppose beggars can’t be choosers. From Fitch…
KEY RATING DRIVERS
BUDGET TEMPORARILY STABILIZED WITH TAX INCREASE: Temporary increases in both the personal and corporate income tax rates, coupled with statutory spending limits, have closed a significant portion of the structural gap in the state’s budget through the current fiscal year 2014.
NEED FOR LONG-TERM SOLUTION REMAINS: Due to the temporary nature of the enacted tax increases, the state will need to find a more permanent solution to the mismatch between spending and revenues. The Negative Outlook reflects the critical need to address this issue. The governor’s recommended budget for the coming fiscal year would make these tax increases permanent and provide a basis for the state to achieve fiscal balance.
LARGE BALANCE OF DEFERRED PAYMENTS REMAINS: The state has a large general fund accounts payable backlog, which although reduced still totaled $4.2 billion at the end of fiscal year 2013. The state prudently used higher than forecast income tax collections in fiscal 2013 to pay down a portion of the accounts payable balance.
LONG TERM LIABILITIES HIGH: The state’s debt burden is above average and rose during the recession with issuance for operational purposes. Continued borrowing is expected under the $31 billion capital plan. Further, unfunded pension liabilities are exceptionally high and are expected to remain so, even if pension reform survives legal challenge.
ACTION ON PENSIONS: Passage of pension reform legislation was a positive indication of the state’s willingness to take action on this complicated issue after many failed attempts. Legal protection of pension benefits is particularly strong in Illinois and, as expected, legal challenge to the reform has been filed.
ECONOMY STRONG BUT RECOVERY SLOW: The state benefits from a large, diverse economy centered on the Chicago metropolitan area, which is the nation’s third largest and is a nationally important business and transportation center.
RATING SENSITIVITIES
Maintenance of the ‘A-’ rating will require timely action in advance of the expiration of temporary tax increases in fiscal 2015. Deterioration in the state’s financial position, as evidenced by excessive use of non-recurring revenues or additional payment deferrals, would likely lead to a downgrade. In addition, stabilization of the rating will reflect the extent to which pension reform enhances the funding levels of the pension systems and controls the growing impact of pension payments on the budget.
* From Moody’s…
SUMMARY RATING RATIONALE
The rating is supported by the state’s general obligation (GO) pledge. Despite substantial pension reforms adopted in December, Illinois remains the lowest-rated US state, at A3 with a negative outlook. Reform enactment launched the legal process that will determine whether constitutional protections prevent the state (and local units) from lowering liabilities through plan changes that affect existing pension participants. Courts may invalidate the reform package altogether, or block pieces of it. If allowed, the reforms could put Illinois on track to manageable long-term pension funding, although the retiree benefits burden will still be heavy compared with many other states. Also pressuring Illinois’ finances is a history of operating deficits, negative GAAP-basis fund balances and payment deferrals. As offsets to its challenges, Illinois has a large and diverse economy, with above-average wealth, and its powers over revenue and spending are strong. State law gives the highest priority to the payment of general obligation debt service. […]
OUTLOOK
Illinois’ negative outlook reflects our expectation that the state’s financial position could deteriorate further if the state’s 2011 tax rate increases are allowed to expire without offsetting steps next year. Pension reforms passed in December could improve the state’s credit standing, by reducing accrued liabilities, but they may be rejected after legal challenges from employees and retirees.
WHAT COULD MAKE THE RATING GO UP
–Implementation of a credible, comprehensive long-term pension funding plan, after favorable court ruling
–Substantial progress in reducing payment backlog, with adoption of a legal framework or plan to prevent renewed buildup of bills
–Establishment of a pattern of structurally balanced budgets
WHAT COULD MAKE THE RATING GO DOWN
–Failure to address impending revenue loss from partial sunset of 2011 tax increases
–Significant further deterioration in pension funded status
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Fun with numbers
Friday, Apr 4, 2014 - Posted by Rich Miller
* ABC 7…
Chicago’s first-quarter murder total this year hit its lowest number since 1958, police say.
The first three months of the year saw 6 fewer murders than the same time frame in 2013–a 9 percent drop–and 55 fewer murders than 2012, according to a statement from Chicago Police.
There were 90 fewer shootings and 119 fewer shooting victims, drops of 26 and 29 percent respectively, according to police statistics. Compared to the first quarter of 2012, there have been 222 fewer shootings and 292 fewer shooting victims.
* BizPac Review sucks its thumb…
So what’s changed that could possibly account for such a dramatic fall in a city that was fast becoming known for its homicide rates — especially in its notorious South Side neighborhoods?
In July, the Illinois legislature overrode Democratic Gov. Pat Quinn’s veto to make The Land of Lincoln the final state in the country to have a concealed firearm carry permit law.
This is a classic case of correlation not being causation. The first 5,000 concealed carry permits weren’t mailed until February 28th, two months into the quarter.
Not to mention the coldest winter on record kept people cooped up inside. And the indisputable fact that the Chicago police have been doing a much better job at stopping crime over the past two years.
Don’t take any credit yet, gun-lovers.
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Today’s numbers are shrinking
Friday, Apr 4, 2014 - Posted by Rich Miller
* Daniel Kay Hertz documented Chicago’s shrinking middle class since 1970 by measuring each Census tract’s median family income as a percentage of the median family income for the Chicago metropolitan region as a whole. The gray areas are defined as middle class on the map tracts. Check it out…
If the gif images aren’t advancing on your browser, click here.
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Caption contest!
Friday, Apr 4, 2014 - Posted by Rich Miller
* Oswego Willy won’t be commenting much today because he’s at opening day. He sent over a photo…
I told him to watch out for falling concrete.
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Question of the day
Friday, Apr 4, 2014 - Posted by Rich Miller
* Bruce Rauner scored just 17 percent of Sangamon County Republican primary votes last month. He has slammed Republicans who work with public employee unions as “corrupt,” which would include all three of the GOP legislators who represent Springfield, which is chock full of state employees. Sen. Kirk Dillard, who was backed by those unions, won the county with a whopping 62 percent of the vote.
But Rauner will soon travel to the belly of the beast, so to speak…
GOP gubernatorial nominee Bruce Rauner will speak at a Sangamon County Republican Foundation event in Springfield on April 8.
Rosemarie Long, who chairs the county Republican Party, said the first-ever recognition evening for major supporters of the foundation will be at the Sangamo Club. Drinda O’Connor is treasurer of the foundation, which provides support to local Republican efforts.
Bill Cellini was the foundation’s former chairman, and stepped down as its treasurer in 2012.
* The Question: What will Bruce Rauner say to Sangamon County Republicans? Snark is heavily encouraged, of course. Have fun.
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* Senate Republicans were really upset yesterday…
Gov. Pat Quinn engaged in a “sneaky abuse of power” when he sidestepped the Illinois Senate in an attempt to keep two controversial appointees on the job, Republicans said Thursday.
A week after the Democrat from Chicago used an unprecedented parliamentary maneuver to extend the tenures of two agency heads, GOP senators called on the Attorney General’s office to weigh in on the move and filed legislation designed to close a loophole in the Senate rules that govern gubernatorial appointees.
“This is really a slap in the face to the Senate,” said state Sen. Michael Connelly, R-Lisle.
* But this is what Gov. Quinn said yesterday…
“Well, the Senate President asked for more time and we were happy to give it to him.”
Audio…
It can’t possibly be a “slap in the face to the Senate” by the governor if the Senate President is the one who asked Quinn to do it. Pretty much every story written on this topic has made it appear as though Quinn did an end-run around Cullerton, when in fact, as subscribers already know, this was a negotiated deal.
* However, there is a good argument here…
State Sen. Tim Bivins’ amendment would prevent an extension of the 60 session days of consideration the Senate has by law to confirm appointments made by the governor. Senate Republicans are also sponsoring a modification of the Senate rules, and have asked Illinois Attorney General Lisa Madigan to issue an opinion on the current law.
“This flies in the face of the constitution and its intent,” Bivins, of Dixon, said of Quinn’s actions. He noted that under the constitution, “the potential exists to make all appointments in this manner.” […]
The governor’s withdrawing the names of Hamos and Flores from consideration by the Senate and then moving to re-nominate them allows the time clock on the appointment process to restart, giving supporters of the an extra 60 [session] days to secure votes in their favor.
A governor could conceivably do this forever to get around the “advice and consent” clause of the Constitution. That’s a problem.
* However, the Illinois Constitution is weighted heavily in favor of the governor…
The Governor shall nominate and, by and with the advice and consent of the Senate, a majority of the members elected concurring by record vote, shall appoint all officers whose election or appointment is not otherwise provided for.
Any nomination not acted upon by the Senate within 60 session days after the receipt thereof shall be deemed to have received the advice and consent of the Senate.
The General Assembly shall have no power to elect or appoint officers of the Executive Branch.
Unlike the federal branch, our state Constitution deems appointees confirmed if there is no Senate action. If the Senate chooses not to act, you can’t really compel it to do something here.
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Today’s quote
Friday, Apr 4, 2014 - Posted by Rich Miller
* Dispatch-Argus reporter Eric Timmons interviewed Paul Schimpf, the Republican candidate for Illinois attorney general…
Mr. Schimpf faces tough odds in taking on incumbent Attorney General Lisa Madigan.
He called the “biggest threat” to the nation the “toxicity and venom in our politics” and promises to steer clear of mudslinging, even if that irks party officials.
“There are some consultants in the Republican Party that are saying you need to attack her (Ms. Madigan) personally and make the argument that she should be in jail,” he said. “I don’t believe that, and I’m not going to do that.”
Those are some pretty intense consultants.
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It’s about the tax hike
Friday, Apr 4, 2014 - Posted by Rich Miller
* After talking about “intrigue” and “mysteries” for days, the Chicago media finally woke up to what has really gone wrong with Mayor Rahm Emanuel’s pension reform bill. I mean, just look at this story from two days ago…
Gov. Pat Quinn on Wednesday trotted out his running mate Paul Vallas to hammer Republican challenger Bruce Rauner’s position that the state income tax rate should rolled back, saying doing so would result in huge cuts to education and spikes in local property tax rates. [Emphasis added.]
* Much of last week’s budget address was about how Illinois’ high property taxes were holding the state economy back…
In Illinois, more is collected in property taxes every year than in the state income tax and state sales tax combined. In fact, Illinois has one of the highest property tax burdens on homeowners in the nation - more than 20 percent above the national average. The property tax is not based on ability to pay. The property tax is a complicated, unfair tax, hitting middle class families the hardest.
* Flash-forward…
If the mayor’s pension reform plan is approved by state lawmakers, the governor and local aldermen, the city’s share of property would increase over 30 percent by the year 2020.
* So, bingo. Now everybody knows what’s up. It’s the taxes, man…
Gov. Pat Quinn finds himself in a bit of a political pickle: he’s running for re-election on a pledge to cut property taxes, but Mayor Rahm Emanuel wants to raise Chicago property taxes as part of a plan to shore up the city’s ailing government worker pension systems. […]
Signing a city pension bill that would end up with a Chicago property tax increase would run counter to Quinn’s campaign message ahead of the Nov. 4 election.
* The Governor made it pretty darned certain yesterday where he stands…
I wanna make it clear: I believe in reducing the burden of property taxes in our state.”
* And it’s not just Gov. Quinn…
“Right now, a lot of people are concerned about the property tax part of the bill,” said Rep. Mike Zalewski, a Riverside Democrat who supports the bill. “It all came up all of a sudden, and a lot of us were thrown off.” […]
“We’re nowhere right now. I think our members had reservations about granting a new levy authority for the city of Chicago,” said [House GOP leader Jim Durkin], who added that the legislature needs to help Chicago find a way to resolve its financial problem.
* More…
Municipal pension funds are created and governed by state law, so the General Assembly must approve changes. The Chicago plan would increase employee contributions and reduce benefits to retirees. But lawmakers don’t want their fingerprints on any city council vote to raise taxes.
“A lot of us would like to see the aldermen take that vote before we do ours … ,” said Chicago Democratic Rep. Kenneth Dunkin, leader of the Legislative Black Caucus. “We’re starting down here, but there are no assurances the city of Chicago, the aldermen, will follow suit.” […]
“There’s really no reason for any mention of real estate taxes in that pension bill … ,” said Rep. Ron Sandack, a Downers Grove Republican. “For me, I’m not going to vote for a pension bill that has any mention of even a permissive, suggestion of raising taxes. That’s for them.”
* But there’s a problem…
Matt Brandon, secretary-treasurer of SEIU Local 73, said his union, which has about 10,000 members affected by the city pension plan, believes the property-tax guarantee should remain in the package.
“There has to be a revenue guarantee to make this bill the bill we sat down and agreed to with the city of Chicago,” Brandon told Early & Often.
“If what happens with this bill eliminates the revenue guarantee that all of the unions sat there and negotiated with the city, no, we can’t support this bill because that’s the only way we get the pensions 90-percent funded by 2054,” Brandon said.
* SEIU is also trying to calm some nerves. The CTU went after Rep. Christian Mitchell (D-Chicago) hard in the primary, but the SEIU’s Brandon is attempting to assure nervous legislators that his union will have their backs…
Brandon, however, tried to calm that sentiment by telling reticent city Democrats his union — and others backing the mayor’s plan — would be with them come election time if they vote for the city pension package.
* But SEIU’s message may not be getting out…
Emanuel said he had agreement from 31 labor unions involved, but representatives from three — including the American Federation of State, County and Municipal Employees and the Chicago Teachers Union — oppose it. Those are powerful voices, said Nekritz, and lawmakers haven’t been lobbied by the groups Emanuel says are in favor.
“We’re not hearing anything from them to say, `Yes, do this’… ,” Nekritz said. “That sends a message.”
* But notice how toned down Rauner’s reaction is…
A spokesman for venture capitalist Bruce Rauner, Quinn’s Republican opponent in the November election, said in a statement that Rauner disagreed with the mayor’s proposal.
“Bruce has always maintained that true pension reform requires moving towards a defined contribution style system and believes that should also be part of the solution for Chicago,” said campaign spokesman Mike Schrimpf.
Compare that to his rants on the state pension reform bill and this is unbelievably mild.
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* From a press release…
Rauner Releases Second Ad of General Election
- Highlights bi-partisan support, will take on both political parties -
Citizens for Rauner launched a new television advertisement today featuring Bruce’s wife, Diana, and highlighting his willingness to take on both parties to fix Illinois.
Watch it by clicking here: https://www.youtube.com/watch?v=LqzFaWpDLOI&feature=youtu.be
The Rauner campaign’s first ad of the general election was a Spanish-language ad released two weeks ago.
“NUTS”
BR: I’m Bruce Rauner
DR: I’m Diana Rauner
BR: I’m pragmatic
DR: He’s cheap
BR: We don’t agree on everything
DR: Like politics
BR: What to eat
DR: And that shirt
BR: What?
DR: It’s old and ugly
BR: I’m a Republican
DR: I’m a Democrat
BR: I love her anyway
DR: I’m voting for him anyway because I know Bruce will take on both parties to fix Illinois.
BR: And drive the career politicians nuts. I will. I’ll drive them nuts.
DR: I know, honey. I know.
* It views much better than it reads. Mrs. Rauner is really quite good at this. Have a look-see…
*** UPDATE *** Here’s the cable TV portion of the buy. Notice the networks, including Food Channel and HGTV. This ain’t a Fox News kinda thing…
Citizens for Rauner
Republican candidate for Governor of Illinois
Agency: Access Media, Los Angeles
Total schedule: $82,256
Flight Dates: 4/4/14 - 4/10/14
Networks: BRVO, FOOD, HGTV, TVL, USA
Dayparts: 4-7P, 7P-Midnight
Syscodes / zones / $ by zone
5170 / Chicago Interconnect / $68, 880
9804 / DirecTV / $7,917
9810 / DISH / $5,459
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