New TIF money to be declared a surplus?
Tuesday, Apr 15, 2014 - Posted by Rich Miller
Posted by Barton Lorimor (@bartonlorimor)
* From the WTTW-TV page carrying a recent Chicago Tonight interview…
“One of the consequences of the property tax increase is more property tax revenue in TIF [Tax Increment Financing] districts,” Burns said.
There are 153 TIF districts in the city, and typically, any additional increment generated would go into the TIF districts, according to Emanuel spokeswoman Kelley Quinn.
“Aldermen Burns and Pawar came to the administration with the idea that any additional funds generated in TIFs would immediately be declared a surplus. It was a good, creative idea that the mayor fully supported,” Quinn said in a statement. “This means that CPS will get 50 percent of the surplus, while the City will receive 20 percent, of which will go towards pension payments.”
I haven’t seen any react from the CTU just yet, but Karen Lewis has been full of new revenue ideas as of late, including Ald. Fioretti’s commuter income tax…
“Revenue is the issue,” says Stacy Davis Gates, Political Director with the Chicago Teachers Union. “Pensions are not the issue. He proposed a commuter tax. He also proposed other innovative ideas.”
* By the way, while we’re on the topic of Fioretti…
ld. Bob Fioretti (2nd) slammed Mayor Rahm Emanuel Monday, calling some of his decisions “inescusable” and saying his administration had “fumbled” many projects.
He also said he’s been mulling a mayoral run in next year’s election while “meeting with people all across the city in every ward.”
“I’m honored and I’m encouraged by the responses that I hear,” he said at a City Club of Chicago luncheon Monday. The alderman promised he “will make the announcement at an appropriate time, in the appropriate place.”
* To get back to the pension issue, though…
The dialogue regarding why the Senate Republicans voted against this proposal but put green lights on others, and how the state might handle other communities that come to Springfield to adjust their pension systems is especially interesting in the long run. Now that the Mayor has broken through, others are saying they will follow…
“Personally, I was patient until Mayor Rahm Emanuel went to Springfield and showed the rest of the mayors of the state how to get it done,” Hanover Park Village President Rodney Craig said. “Then my patience kind of runs out.”
Because the General Assembly made pension reform happen for Chicago, Craig said, “I want the same level of commitment to the municipalities of the rest of the state.”
On Monday, Craig and other members of the DuPage Mayors and Managers Conference met with the Daily Herald Editorial Board to insist a state law that reduces pension benefits for police and firefighters is needed to stabilize municipal budgets and prevent pension systems from collapsing.
* Related…
* Rauner urges Quinn to veto Emanuel’s pension bill
* Ald. Pawar Kicks off Re-election Bid, Says ‘Maybe’ to Future Mayoral Run
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Posted by Barton Lorimor (@bartonlorimor)
* Check out this resolution that was recently approved by the SERS Board of Trustees…
(1) express our concerns about the serious implementation issues SERS faces as we struggle to prepare for the effective date of the new pension law and for the burden SERS will face if the law is implemented and then found unconstitutional,
(2) request that the Attorney General seek or agree to a stay of the new law’s implementation until the lawsuits that challenge the new law’s constitutionality are finally completed, and
(3) if the Attorney General will not comply with point (2), request that the Board of Trustees be allowed to select its own counsel to defend SERS and the Board in the lawsuits that name them as defendants so that SERS and the Board are able to express their position in the lawsuits and seek or agree to a stay of implementation of the new law until the lawsuits that challenge the new law’s constitutionality are finally completed.
The resolution passed unanimously.
H/T to a regular reader who brought this matter to our attention yesterday afternoon.
*** 12:43 p.m. - *** From comments below, an update from resident pension expert RNUG…
This is old news. I did hear that the lawyers for Kanerva / Maag filed additional information / arguments immediately after the favorable AZ ruling but that was a while back. Truthfully, I had expected we would have known something by now. Right now it’s anybody’s guess; maybe the AZ decision has the ISC rethinking their unpublished opinion.
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Popped for pop
Tuesday, Apr 15, 2014 - Posted by Rich Miller
Posted by Barton Lorimor (@bartonlorimor)
* Umm…
Nahshon Shelton didn’t want to pay the 22-cent tax on his $1.79 two-liter of Pepsi on Saturday afternoon, Chicago Police said.
So he allegedly pulled a blue-steel Intratec .22-caliber submachine gun out of his Gucci satchel inside the convenience store in the 4000 block of West Madison Street where they tried to make him pay it — and he threatened to kill everyone there, a prosecutor said.
This “is my neighborhood, I’m tax exempt!” he would later allegedly tell the cops, the Sun-Times is reporting. “Man, you know what, I’ll keep it real. I had to put them in their place.”
o.0
Well, this is awkward because…
Lawmakers in both the House and Senate have proposed a hike in the Illinois soft drink tax.
Soft drinks in the state are subject to a 6.25 percent tax compared to ‘qualifying food and drugs,’ which are taxed at one percent. The legislation would raise the cost of soda, juice drinks, sports drinks and teas.
The tax would be a penny-per-ounce surcharge on sugar-sweetened drinks.
Add soft drinks to the ever-growing list of items legislators are looking to tax. Over in the House, legislators have heard proposals to increase the cigarette tax, overhaul or eliminate the corporate franchise tax, extend the research and development tax credit, and making tax credits transferable.
* Increasing the motor fuel tax has also been a part of those discussions…
A recent proposal to raise the Illinois fuel tax to pay for state transportation costs is meeting opposition.
Retail gas station owners announced their opposition to such a plan on Monday in Springfield. They say raising the tax hurts drivers and businesses during a tough economy.
Bill Fleischli is the vice president of the Illinois Petroleum Marketers Association. He says the state should stop diverting money intended for roads to other areas of the budget.
BlueroomStream subscribers should have access to video of yesterday’s media availability with the petroleum marketers.
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Morning Shorts
Tuesday, Apr 15, 2014 - Posted by Rich Miller
Posted by Barton Lorimor (@bartonlorimor)
* Here is what is in the news on this Tax Day…
* Suit filed in wake of concealed carry permit rejection: “The training class was worthless because it did not qualify consumers for the concealed-carry permit,” the lawsuit alleges. “(Ambrose) wasted a significant amount of time taking the worthless class, and had his application for a concealed-carry permit rejected.” … Illinois State Police officials said earlier this month that the agency had denied concealed carry licenses to 327 applicants who received inadequate training from an instructor in Bolingbrook.
* FBI director in Chicago: ‘Painfully aware’ of city’s gun violence: “There is not an easy answer on violent crime, especially gang-related crime that is so embedded in the culture,” he said. “Chicago has a larger and more ingrained and sophisticated street gang structure than many American cities…You can’t arrest your way to a healthy neighborhood.”
* Illinois House orders new audit of anti-violence spending under Quinn: The House resolution pushed by state Rep. David Reis, R-Willow Hill, directs Auditor General William Holland to study that spending. Further, Reis’ resolution asks Holland to audit state funds disbursed by the Criminal Justice Information Authority to a social-service provider that helped implement the Neighborhood Recovery Initiative, the Chicago Area Project.
* Daley nephew released from McHenry County jail
* In Illinois, a Challenge Recruiting Rural Students for State’s Flagship University: While the size of the freshman class at the Univ. of Illinois at Urbana-Champaign has decreased slightly, from about 8,200 in 2004 to about 7,200 in 2013, the number of students who matriculate from rural counties has sharply declined. In 2003, there were 1,017 freshmen from rural counties who enrolled, compared to only 600 rural students in the freshmen class during the 2013-14 school year.
* Illinois Debates Continuing Free ACT Test: State board officials estimate it will cost $14 million for all high school juniors to take the ACT test next year, which they want to keep even though it is scheduled to be phased out with the implementation of other exams … By keeping the ACT and adding new exams at the elementary and high school levels, the cost of state testing would total $54 million next year, double this year’s $27 million.
* I-Team: Watchdog group questions one gas company: The CUB e-letter warns residents “don’t be fooled” by the pitches and promises of Nicor Advanced Energy.
* Quinn Touts Help for First Time Home Buyers
* Cross, Frerichs Treasurer Contest Cues Up Fierce Clash
* Lt. Gov. Simon, husband report $208,000 in Illinois income
* IDOT Increases Safety Precautions for Highway Workers
* Prospect Hts. names new city administrator
* [Quincy] department heads attempt to justify budgets to aldermen
* District 150 OKs 200 pink-slips, Peoria Police costing district unbudgeted $180,000
* Pekin City Council approves $12 garbage fee
* Massac County Picks Banterra Bank as Temporary Courtroom
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Posted by Barton Lorimor (@bartonlorimor)
* Yup. It’s me, again.
You guessed it: I am coming out of retirement briefly to take you through the next week or so because Rich is off enjoying spring break. Once he comes back, I go right back in the box.
* If you were here the last time I filled in, then you know the jokes get a lot worse as the week goes on.
You would also know most of the day’s posts will be up first thing in the morning since I am on state time during the day. I appreciate all of your comments and emails, which is why my Twitter account and email address are available at the top of every post I do.
So here we go, gang. How is everybody this morning?
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Proft explains himself
Tuesday, Apr 15, 2014 - Posted by Rich Miller
* I had an e-mail exchange with Dan Proft last month that I meant to post at the time, but didn’t get around to it because session had kicked into high gear and I was buried with government stuff. I asked him for permission yesterday to reprint our exchange and he agreed.
Proft sent me a characteristically ascerbic note last month about a post I did disagreeing with his big-bucks support for Keith Matune, a Republican who finished just a smidgeon behind GOP Rep. Ron Sandack in the March primary…
The worst thing Proft did though, was that when the truth came out [about Matune’s multiple arrests], he didn’t back away. Instead, he doubled down, forcing the House Republicans to spend a fortune to keep the seat. If Proft’s guy had won, the House Democrats would have assuredly jumped in and made the House Republicans spend even more money to defend the seat.
Look, this is a free country. Proft can do whatever he wants. But the Matune race shows his only real priority was defeating a Republican he didn’t like, not winning a Republican seat. It was totally irresponsible to push a supremely flawed candidate so hard.
* Proft’s response…
Your analysis of Sandack-Matune conveniently ignores the substance of Sandack’s legislative record–the focus of the campaign material I put out. Additionally, it ignores the details of the Matune allegations Sandack misrepresented or outright manufactured and any context to his 20-year old arrests for such crimes against humanity as public urination.
But I’m “reckless and irresponsible.” Okay. Someday–and I know today is not that day–I hope you’ll give consideration to your routine defenses of all things GOP establishment, particularly when those defenses offer no contextual consideration of their performance–you know, those guys in the superminority–much less mine.
I am forever fascinated by the differing standards of analysis.
Regards.
* Lemme let you in on a little secret. We disagree about a lot of stuff, but Proft and I have a history that’s been mostly friendly, albeit peppered with occasional acrimony, which I actually have enjoyed. So I chuckled at his e-mail and, since I’m not generally in the habit of sending long e-mails, my reply was brief…
You do have a way with words. But your response completely ignores my points.
* Proft fired back…
Which is what, the shibboleth from Team Durkin you’re re-purposing that Matune would’ve put the district in play in the general? Nonsense. 60%+ GOP district.
They were making the same argument against [Peter] Breen and he is unlikely to even draw an appointed opponent (certainly not one of any consequence) according to what I understand.
* My reply…
More nice words. You may refer to it as a shibboleth, but it’s real. More importantly, though, you forced leadership to spend money it didn’t have on a primary to fight off a very flawed candidate.
Shibboleth: An old idea, opinion, or saying that is commonly believed and repeated but that may be seen as old-fashioned or untrue.
* Proft…
They spent money to defend a very flawed candidate. As they did with Pihos. No one forced Durkin to spend money. His choice. Just as it was my choice.
Two years ago against a woefully underfunded candidate Sandack won 54-46. This time by 150 votes. Maybe there is an actual uneasiness with Sandack in his district with darn nearly half of the GOP primary electorate that should be considered? Is that possible? Should that be part of the assessment? Why is Sandack such an unpopular incumbent (and was before his marriage vote)? Compare his fav/unfav numbers to Pihos, for example, before I ever spent a dime in either race (except on polling).
We don’t exist to do leadership’s bidding because they have titles. That philosophy begets the superminority–as they have proven. I don’t see offices as someone’s birthright where someone else gets to decide who runs and who doesn’t and when. That approach pushes talented people away–a long-running problem with the GOP.
So when does a decade-plus of under-performance demand questioning of “leadership’s” decision-making? I am baffled by the deference they are supposed to be afforded.
Oh, and considering our interests are now aligned for the general election and Durkin has expressly asked for me help, “leadership” has a strange-way of party-building or asking for help. But that too will be left on the cutting room floor, I suppose, as it doesn’t fit the narrative or a plucky group of legislative leaders financed by the politically promiscuous trying to stave off assaults from the radicals who believe in free minds and free markets.
* At that point, I said he’d made some good arguments, then shifted the discussion to our mutually beloved White Sox. I’m just not into these long back and forth e-mail arguments and figured we were finished arguing and now it was time to talk about other stuff.
Look, I don’t agree with everything Proft wrote or everything he has done, but that’s not required. Some of y’all hate the man and you have your reasons. But while I’ve winced more than once when he’s said or done something I didn’t agree with, I have never, ever disliked him.
My best friend in the world once told me that you should never hate more than three people at once. If you hated more than three, it probably said more about you than them. A disagreement is just that. It ain’t personal and you shouldn’t make it personal unless everybody’s going to the mattresses.
* Anyway, try to address his points in your comments instead of his personality. And keep my best friend’s warning about hatred in your thoughts. Thanks.
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Poll: Rauner up by 3, Durbin up by 14
Monday, Apr 14, 2014 - Posted by Rich Miller
* From Illinois Review…
A new Rasmussen Reports national telephone survey of Likely Illinois Voters shows Republican businessman Bruce Rauner picking up 43% of the vote to Quinn’s 40%. Six percent (6%) prefer some other candidate in the race, while 10% are undecided.
The latest Rasmussen statewide poll finds Durbin picking up 51% of the vote to State Senator Jim Oberweis’ 37%. Three percent (3%) prefer some other candidate in the race, while 10% are undecided.
More here and here.
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* The Rauner campaign threw down the gauntlet today…
Republican candidate Bruce Rauner said today that if he were governor, he would veto legislation lawmakers sent to Gov. Pat Quinn last week that would cut pension benefits for some city workers and allow aldermen to raise property taxes to shore up the retirement program.
A spokesman for Rauner said the Winnetka businessman believes the measure should include shifting workers to a 401(k)-style defined contribution plan and contends that “raising property taxes is not the way to go.”
“Unless Pat Quinn wants to raise property taxes, he should veto the legislation,” said Rauner spokesman Mike Schrimpf.
* Greg Hinz…
But it looks to me like Mr. Rauner may have put himself on the griddle, too, because so far, other than a few bromides about cutting “waste,” he’s given absolutely no clue how he’d make up for tens of billions of dollars in unfunded liability in city and state pension funds. And it certainly belies any notion that Mr. Emanuel secretly backs Mr. Rauner for governor.
Today’s developments came when Mr. Quinn scheduled a news conference to talk about a plan to help lower-middle-class families buy their first homes, and the Rauner campaign sent out an advance statement accusing the Democratic incumbent of hypocrisy for not promising to veto the Emanuel bill.
“As Pat Quinn tours the state relaunching a ‘new’ home loan program, will he break his promises again and allow Chicago property taxes to rise?” the statement asked. “Will he or won’t he? Quinn won’t say if he will sign the property-tax bill.” […]
[Rauner’s] pressure on Mr. Quinn to veto the bill ought to erase any lingering notion in some political circles that Mr. Emanuel quietly backs Mr. Rauner for governor. Ain’t so. Moves like today’s by Mr. Rauner have the potential to rev up City Hall and Chicago Democrats to put aside any disagreements with Mr. Quinn and rally city voters for the Democratic incumbent.
But, keep in mind, Rauner is trying to up the GOP’s vote total in Chicago, and this ain’t a bad way to do it.
* Quinn said he was “studying” the pension bill, but also attacked Rauner…
Quinn also used the opportunity to bash his Republican opponent for governor, Bruce Rauner, who earlier Monday released a statement criticizing Quinn’s home-owner relief program as recycled and not new.
“That’s certainly a bizarre opinion,” Quinn said.
The program, available through the Illinois Housing Development Authority, offers certain first-time home buyers and those who haven’t owned a home in three years a low fixed-rate mortgage and up to $7,500 in down payment assistance.
“We are here to help families who don’t have political action committees, who don’t have lobbyists, who don’t have millions of dollars to buy more than one home …,” Quinn said in a thinly veiled reference to his opponent.
* From the Quinn campaign…
Billionaire Bruce Rauner – who owns nine homes - today went out of his way to criticize a successful state program helping everyday people across Illinois afford their very first home. Welcome Home Illinois will give many people the opportunity to buy their first and only home - but it’s clear this billionaire with nine homes of his own can’t relate. Is achieving the American Dream only for the self-proclaimed .01 percent?
This attack on everyday people again shows that billionaire Bruce Rauner is out-of-touch and doesn’t care about the people of Illinois.
More than 24,000 people have shown interest in Welcome Home Illinois, which provides a 3.75 percent interest rate for a secure, 30-year fixed mortgage.
…Adding…. From the Rauner campaign…
From Spokesman Mike Schrimpf:
Once again Quinnocchio is not being truthful with the people of Illinois - Bruce supported the program in 2005 when it was called I-loan, in 2009 when it was called “Illinois Home Start,” and even in 2011 when it was called “Smart Move. The truth is that Pat Quinn’s job-killing income tax hike continues to make life harder for potential homeowners.
Thoughts?
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Sun-Times temporarily turns off comments
Monday, Apr 14, 2014 - Posted by Rich Miller
* From the managing editor of the Sun-Times…
Starting this weekend, the Chicago Sun-Times and the other titles in the Sun-Times Media group will temporarily cease to run comments with our articles.
The world of Internet commenting offers a marvelous opportunity for discussion and the exchange of ideas. But as anyone who has ever ventured into a comment thread can attest, these forums too often turn into a morass of negativity, racism, hate speech and general trollish behaviors that detract from the content.
In fact, the general tone and demeanor is one of the chief criticisms we hear in regard to the usability and quality of our websites and articles. Not only have we heard your criticisms, but we often find ourselves as frustrated as our readers are with the tone and quality of commentary on our pages.
To that end, we are working on development of a new commenting system we hope will not only allow for free discussion, but encourage increased quality of the commentary and help us better police the worst elements of these threads. We’ll have more in the weeks to come on this development.
* Robert Feder weighs in…
It’s true that unmoderated comment boards — or those that don’t require verification (a Facebook account in the case of my blog) — leave themselves open to abuse. But a big-city daily’s digital news site that summarily shuts off dialogue with its readers strikes me as wrongheaded and backward-thinking to the extreme.
The key word is “unmoderated.” Newspapers and other “old media” have got to get a handle on their sites. Most of them don’t have the cash to hire a full-time comment moderator, so they’ve relied on apps and programs that don’t work very well.
I shut down comments for a while when I used the Blogger platform because I couldn’t effectively moderate comments. I moved over to WordPress and that helped me deal with most of my problems. But monitoring comments, and engaging with commenters to nudge or even shove them back onto the topic at hand ain’t easy. It’s a lot of work. Every time I leave to run an errand (as I’m about to do), I worry about what’s being posted and try to constantly check the blog to make sure all is OK.
So, I have little confidence that a magic program will solve all their problems. If they really want to get at the heart of the issue, they’ll hire somebody to watch over their comments. It’s the only truly effective way to solve this very real problem.
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Question of the day
Monday, Apr 14, 2014 - Posted by Rich Miller
* Mark Brown notes that if Gov. Pat Quinn were running against anyone else, his reception at last week’s IEA forum might not have been so warm, what with pension benefit cuts and cuts to education funding…
But Quinn reminded delegates to the Illinois Education Association that the choice in the upcoming election isn’t between what they want and what he did.
“Please don’t compare me to the Almighty. Compare me to the alternative over here,” Quinn said, gesturing to Rauner, who makes no secret of his antagonism toward teacher unions. […]
Meeting briefly with reporters after the session, Rauner started off by quipping: “I’ve never been called Bruce Almighty before. I kinda like that.” […]
We’ve been needing a nickname for Rauner to go with the Quinnocchio depiction he’s hung on Quinn, and I’d say Bruce Almighty is a perfect fit.
Bruce Almighty: the candidate with the miraculous plan to cut the state income tax back to pre-Quinn levels and still provide more money for education and pay off the state’s backlog of bills.
* The Question: What would your nicknames be for both candidates? Make sure to explain.
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Fun with money
Monday, Apr 14, 2014 - Posted by Rich Miller
* Crain’s…
Andrew Boron, director of the Illinois Department of Insurance, is pushing legislation that would provide $5 million to a new state corporation chaired by Mr. Boron to recruit out-of-state insurers. The money would be siphoned from the fees insurers and insurance brokers pay to fund the state’s regulation of them.
He wants to replicate the success the department had in wooing EquiTrust Life Insurance Co. from suburban Des Moines, Iowa, which is a national hub for life insurers. […]
The $5 million to lure insurers from other states accounts for about 10 percent of the $52 million the Insurance Department receives annually from insurers and brokers.
So, the plan is to take insurance company fee money and use that cash to lure competing insurance companies to Illinois?
I suppose I can see the logic in this, but has anyone thought of just lowering the insurance fees by 10 percent?
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Reform and renewal
Monday, Apr 14, 2014 - Posted by Rich Miller
* Eric Zorn came up with a great analogy about Bruce Rauner’s proposed constitutional amendment for term limits, etc.…
In one of the more memorable scenes in the 1971 comedy “Bananas,” Woody Allen’s character Fielding Mellish is perusing the magazine rack at a small store. He’s trying to sneak peeks at the erotic fare in a way that avoids the notice of a matronly woman at the nearby checkout counter (see YouTube clip below)
He settles on a plan. “I’ll get a copy of Time magazine,” he says, loud enough for the woman to hear, as he takes a copy off the rack. “I’ll take Commentary. And the Saturday Review. And, uh, let’s see, Newsweek, and just I’ll grab one of these…”
He slips one of the skin magazines into the small collection of periodicals he doesn’t really care about, then turns to the cashier. “I’ll take `em all,” he mumbles as the woman looks on from several feet away.
It’s a nice try at misdirection.
Zorn’s premise is that Rauner is attempting to get around the state Constitution’s limit of popular amendments to only “structural and procedural” changes in the the General Assembly’s Article by proposing a change in the number of House and Senate members and an increase in the number of votes to override a gubernatorial veto…
So think of the term limits proposal as the equivalent of the pornographic publication in “Bananas” — the illicit yet true object of desire.
And think of the other two elements on the Committee for Legislative Reform and Term Limits petition as the equivalent of Saturday Review and Newsweek — conventional, but, really, beside the point.
Both are clearly constititutional.
* Meanwhile, the Tribune editorialized again in favor of a different constitutional amendment for redistricting reform…
Next comes the inevitable lawsuit, challenging the constitutionality or the language of the amendment, or both. It would fall to the Illinois Supreme Court, whose members were elected with party support, to decide whether the measure stays on the ballot.
Then there’s the big disinformation campaign, on which millions will be spent to convince voters that the amendment is bad for them. Already, the state’s top Democrats are voicing disingenuous concerns that the measure could reduce minority representation.
Um, I wonder who’s gonna spend “millions” to fight this? The unions will be spending all they can to defeat Rauner. The House and Senate Democrats will be spending cash on their own races, along with the state party.
Is there a pro-status quo millionaire out there who will step in and throw big money away attempting to defeat a proposal which has overwhelming popular support? I kinda doubt it.
* And Paul Green, writing in the Daily Herald, gets the last word again…
Reform is a many splendored thing. You want to be a reformer? It’s easy; simply call yourself one, e.g., every Chicago mayor since 1837 has labeled himself or herself — a reformer. As we meander into the Illinois General Assembly’s closing weeks of session and ponder the upcoming November general elections, once again its “Reform Time — Illinois Style”.
Some “reformers” want to change how Illinois legislative maps are drawn. Other “reformers” want to initiate term limits for state legislators, while almost everyone claiming reform DNA — constantly use the terms “transparency” and accountability” like those words have some biblical meaning to frame their intentions.
Statewide reform goals and philosophy aside, the main target for all this activity is Illinois House Speaker Michael Madigan. Reformers lament and criticize “The Speaker’s” power, influence and durability, especially in his control of the Illinois House.
Alas, what is seldom if ever mentioned, is that Speaker Madigan was created — you guessed it — by reformers. Yes, my friends, over 30 years ago, a youngish reformer (who now happens to be Illinois governor) led a constitutional crusade to end cumulative voting for electing Illinois House members.
It was called the “Cut-back” Amendment” — it created single member districts, reduced House membership from 177 to 118 members and obliterated independent Republicans from Chicago and independent Democrats from suburban Cook and the Collars. And it gave a shrewd and workaholic Mike Madigan the opportunity to create a power base that would have been impossible pre-Cut-back.
Ergo, beware of reform promises. Or, said another way, if folks are promising a New Deal, make sure you cut the cards.
* Related…
* ADDED: House votes to make secret government severance deals public
* AARP backs changes to redistricting process
* Baar-Topinka tells broadcasters term limits are stupid
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Simple solutions are usually neither
Monday, Apr 14, 2014 - Posted by Rich Miller
* Greg Hinz writes about the costs of Chicago pension reform…
Some critics want to tap the city’s tax- increment financing system rather than raise property taxes $50 million each of the next five years, as Mr. Emanuel’s plan requires.
TIFs are a big, juicy target for those who want to protect homeowners. The city’s 153 TIF districts have a total of $1.7 billion in the bank and generate another $400 million-plus each year.
But roughly $1.5 billion of the $1.7 billion is already committed for projects such as an $800 million school construction plan announced a few years ago, a $15 million Chinatown library, an $18 million Albany Park library and a $12 million streetscape project for Devon Avenue, says Budget Director Alexandra Holt. She didn’t detail all $1.5 billion, but I have no reason to doubt her. With a couple of exceptions, the money is going to neighborhood projects, not downtown handouts.
Similarly, much of future years’ receipts are committed for things such as a $50 million el station at Cermak Road, a $9 million industrial project in Pilsen and debt payments. And total receipts are beginning to drop quickly, as TIF districts with a legal 23-year life begin to expire, like the huge $120 million-a-year Near South TIF.
Ironically, because of the tax hike for pensions, the TIF districts are expected to produce about $20 million in additional revenue, Ms. Holt says. The city will declare that money a surplus and apply its $4.6 million share to pensions, potentially softening the blow of the property tax increase.
* A recent Sun-Times editorial also looked at various options…
What about a Chicago casino, which also requires state approval? That’s worth pursuing but can’t be counted on for now. If lawmakers ever approve, casino revenue is years away and inherently unpredictable. At its peak, perhaps five to seven years into its life, revenue could reach $80 million to $120 million, city officials tell us. […]
The Chicago Teachers Union and others have pushed a financial transaction tax and eliminating tax-increment-financing districts, both of which sound good on paper but have more downsides than pluses.
State actions: Emanuel has advocated for expanding the narrow list of items subject to the sales tax to cover services (think dry cleaning and hair salons). If done right, this could generate more revenue overall while also lowering the tax rate. Quinn is opposed, but an expanded sales tax that matches the modern economy could benefit the entire state. It’s also what most states do. Lawmakers also could increase the share of state income tax revenue shared with municipalities, including Chicago. That was cut in 2011, costing Chicago more than $400 million. The downside, of course, is that the state needs the money.
* Meanwhile, the Chicago Tribune has editorialized strongly in favor of the city’s pension reform bill…
The Illinois General Assembly delivered a special package Tuesday to the Chicago City Council: a pension fix that probably requires aldermen to raise property taxes — less than a year before they stand for re-election.
Given the terrible finances of the city’s pension funds, Gov. Pat Quinn has no responsible choice other than to sign the bill, and the aldermen have little choice but to raise taxes.
So, to sum up, the Trib is in favor of higher property taxes to help solve the city’s historic pension underfunding problems, but totally against an income tax hike to help solve the state’s historic pension underfunding problems.
Go figure.
* And that leads us to this Eric Zorn post listing four reasons why a Chicago income tax should be considered…
But if the alternative is a significant decrease in city services leading to a deteriorating quality of civic life, a city income tax is among the least objectionable options for balancing the books.
* The city’s media ran stories last week about how Mayor Emanuel had completely ruled out the idea…
Mayor Rahm Emanuel on Wednesday ruled out creating a city income tax as a way to shore up the city’s municipal and laborers’ retirement funds while describing the $250 million property tax increase he wants to pay for the pension changes as “a measured way, a responsible way to address the question.”
* Glossed over in all of this is an important point noted in that above-linked Sun-Times editorial…
Emanuel is opposed to a city income tax, which must be approved by Springfield. [Emphasis added.]
* From the Illinois Constitution…
SECTION 6. POWERS OF HOME RULE UNITS
… A home rule unit shall have only the power that the General Assembly may provide by law (1) to punish by imprisonment for more than six months or (2) to license for revenue or impose taxes upon or measured by income or earnings or upon occupations.
* Paul Green has the last word…
Illinois governments at all levels are facing financial disasters and yet various “stakeholders” (I love that word) are bickering as if time were on their side. These stakeholders hope that somehow pension debt and overdue bill payment will be “hoped” away.
The specifics of these crises in Springfield and Chicago are economically complicated, politically toxic and do not lend themselves to a 30 second political commercial. However, the general parameters of the problem are not so complicated. Governments have promised more than they could deliver.
Incoming revenue does not meet expenditure needs, and to resolve these issues everyone in Illinois (Chicago included) has to lose something.
In short, this is a math exam, not an essay test.
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* My weekly syndicated newspaper column…
A long time ago I asked Illinois House Speaker Michael Madigan why he never golfed at his golf outing fundraisers.
Madigan explained that he was a terrible golfer (he’s since improved, I’m told) If people saw him embarrassing himself badly on the golf course, they might take a dimmer view of him as a leader.
He has applied this lesson to just about everything he does. He examines every angle before he acts. He hates mistakes and almost never acts precipitously or impetuously.
For example, Madigan and his staff gather a few times a week to read through every bill and every amendment to those bills to look for flaws, hidden agendas or to discuss strategies. He always wants to be as prepared as possible.
As a result, he rarely fails.
But something else has been happening over the past year or so.
Madigan has become a media hound.
The Speaker has never really sought media attention. He does what he does, and then he goes home, or, more likely, back to his office. A Republican friend of mine calls him “James Bond.”
But after getting royally hammered by the Chicago media over how he asked Metra to give one of his loyal patronage workers a raise, he’s seemed to change. Nowadays, he seeks publicity, and credit.
It started after the House passed the gay marriage bill. It wasn’t an easy task by any means and Madigan publicly took the credit for its passage. A few months later, he took the lion’s share of the credit for passing the long-sought pension reform bill.
Then, earlier this year, out of the blue, he proposed a 50 percent cut in the corporate income tax rate. He got a ton of media coverage, but he hasn’t yet followed up on it. It looked like a “press release bill.” Legislation unveiled merely to generate media interest. It might yet resurface, but as of now it has been disappeared into the ether.
Madigan was also working behind the scenes this spring with the Senate Democrats on a constitutional amendment to impose a three percent surcharge on income over a million dollars. But then Madigan went ahead with his own announcement of the proposal. It was referred to in pretty much all media reports as “Madigan’s millionaire tax.”
At the time of the unveiling, Madigan said he’d done his homework and had talked to his members before announcing his proposal. The constitutional amendment required a three-fifths super majority, so Madigan would need every single one of his Democrats if he couldn’t lock down any House Republican votes.
Rep. Jack Franks, a Democrat who prides himself on never voting for tax hikes, offered tentative early support, but his support was tied to allowing the 2011 income tax hike to expire. Just days later, Madigan publicly supported keeping the tax hike permanent.
Rep. Franks says he told the Speaker that he couldn’t back the proposed constitutional amendment a couple weeks ago. Madigan asked for time to try and find GOP votes. In the meantime other Democrats went off the reservation, including Rep. Scott Drury, who issued a press release last week announcing his opposition. The momentum was going too fast the other way, so the plug was pulled.
Madigan, through a spokesman, blamed the Republicans for the proposal’s defeat. But Madigan had surprised the Republicans with his plan’s unveiling, instead of finding some GOP support in advance.
As it turns out, Madigan simply bit off more than he could chew. His proposal failed, but he sure got a lot of publicity about it, much of it favorable.
And, hey, lemons into lemonade. Pro-business groups like Americans for Prosperity Illinois offered up praise for Rep. Drury, who faces a Republican opponent in November. Drury and Franks, “should be commended for siding with taxpayers and small businesses by taking a courageous stand against this proposal,” said AFP Illinois State Director David From via press release. That’ll surely make Drury more palatable to tax sensitive business owners in his district.
And the proposal put Republican gubernatorial candidate Bruce Rauner in a difficult spot. Rauner flatly opposed the tax, while leaving open the possibility that he could favor taxing retirement income and services. It didn’t make him look good.
Maybe this is all part of some grand scheme. But right now it sure looks like James Bond has gone tabloid.
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