Stay requested on pension law
Friday, May 2, 2014 - Posted by Rich Miller
* The State University Annuitants Association has filed a motion requesting that the relevant portions of the pension reform law be stayed. WUIS has more…
These workers can escape some of the pension reductions if they quit before July. But once someone retires, there’s no going back.
The filing argues that “misinformation and confusion” surrounding the pension law is widespread.
And with State University Retirement System overwhelmed with members seeking counseling, people are having to make these decisions without “the benefit of full information.” It says many workers may be compelled to retire on the mere chance the law would be upheld.
Though the motion is specific to members of the State University Retirement System, a stay would likely be effective for all affected public employees.
I’ve requested a copy of the motion. Check this post for updates in a bit.
…Adding… Click here to read the motion.
…Adding more… With a hat tip to a reader, this was in the DeKalb Daily Chronicle…
As many news organizations have reported in the past week or so, the new, controversial pension “reform” law includes a mistake that affects some public university employees and is causing what some are calling “a mass exodus.”
That’s not an exaggeration. Just at NIU, it’s been reported that as many as 800 employees, or 20 percent, are suddenly heading for the exits. Without even concentrating, I personally can think of about 10 people leaving. Sure, some faculty members might come back to teach on an ad hoc basis, but many won’t and very few staff will return.
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Question of the day
Friday, May 2, 2014 - Posted by Rich Miller
* Sean Sullivan writing in the Washington Post’s “The Fix”…
The road to reelection for Illinois Gov. Pat Quinn (D) was always going to be difficult. But it looks even harder at the end of a troubling week for the Democrat when a federal probe of an anti-violence initiative he started has received widespread attention in the state.
At minimum, the episode is an unwelcome distraction; at most, it could become a big blow to the good-government image Quinn has carefully crafted, close watchers say. […]
A large part of Quinn’s path to victory will depend upon how negative a light Democrats can cast Rauner in during the run-up to November. But the more the focus is on Quinn, the more difficult his path becomes.
Keep in mind that Rod Blagojevich was reelected a few days after his top fundraiser Tony Rezko was indicted and that Quinn was elected in 2010 with an approval rating in the 30s. Also keep in mind that Bruce Rauner has a whole lot more money to spend than any GOP nominee in many a year.
* The Question: On a scale of one to five, with one being the least and five being the most, rate the impact of this anti-violence initiative scandal on Quinn’s reelection chances. Take the poll and then explain your answer in comments, please.
customer survey
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Beyond the rhetoric
Friday, May 2, 2014 - Posted by Rich Miller
* From an op-ed by Kent Redfield on the proposed constitutional amendment to reform redistricting…
This redistricting amendment is straightforward: Create an independent commission of Illinois citizens who would draw state maps in a transparent way, using nonpartisan, criteria. Those criteria would include keeping together communities of common interests — economic, social, racial, linguistic or cultural.
They also include respecting existing city and geographic boundaries and complying with state and federal voting rights laws. And the criteria prohibit the commission from favoring one political party over another or using district boundaries to reward or punish any incumbent legislator.
The number of signatures collected showing support for putting the proposal on the ballot make it unlikely a challenge to their validity will be successful. My reading of the proposal is in agreement with many experts who believe the Illinois Supreme Court will turn back any legal challenge to the proposal.
Yet political leaders in control of the legislature are laying the groundwork to challenge this measure.
Why use precious resources against long odds? The risk does offer a reward. If efforts to block the proposal from being on the November ballot are successful, it will relieve those in power from having to defend the failed status quo.
During the debate over the constitutional convention several years ago, I argued forcefully and repeatedly for a convention based mostly on this one issue of redistricting reform. Politicians shouldn’t be allowed to choose their own voters.
* But there’s a real constitutional issue here. This is what the Illinois Constitution says about citizen amendment initiatives…
Amendments shall be limited to structural and procedural subjects contained in Article IV
Article IV is the General Assembly’s article.
* But this is from the proposed amendment’s language on the composition of the Redistricting Commission…
For ten years after service as a Commissioner or Special Commissioner, a person is ineligible to serve as a Senator, Representative, officer of the Executive Branch, Judge, or Associate Judge of the State or an officer or employee of the State whose appointment is subject to confirmation by the Senate.
By prohibiting people from running for judge or statewide office for ten years, the proposal goes well beyond anything in Article IV.
And that’s a real problem, no matter what the merits of the issue of redistricting reform itself may be. I can understand the reform reasoning for putting that campaign ban in there, but I don’t yet see the constitutional support for it.
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Wheeler on the rebates
Friday, May 2, 2014 - Posted by Rich Miller
* Charlie Wheeler has the best criticism I’ve yet seen on the proposal by House Speaker Michael Madigan and Gov. Pat Quinn to mail out $500 “property tax rebate” checks before the November election…
Quinn touted the idea as “the most significant property tax relief in state history,” at best a dubious claim for a couple of reasons. Chief among them is the fact that the annual $500 check would not be linked at all to actual property tax payments, nor would the giveaway benefit everyone. Indeed, homeowners whose tax bills exceed $10,000 actually would lose money under the governor’s plan, because they’d no longer have the current income tax credit equal to 5 percent of property taxes paid. Renters would get nothing, even though they also pay property taxes as part of their monthly payments.
The governor likened his plan to former Gov. Jim Edgar’s 1997 effort to raise income tax rates to provide more money for local schools and to cut local property taxes, also a stretch if not downright mendacious. The key difference: A major feature of the Edgar tax swap proposal called for a dollar-for-dollar reduction in local school levies for some $900 million in additional state aid, which analysts at the time estimated would amount to almost a 30 percent cut in school operating taxes. Quinn’s plan ignores local property tax levies altogether.
In addition to property tax relief, the Edgar proposal also would have increased state aid to poorer school districts by some $600 million; the only way the governor’s $500 checks would help struggling schools would be if the folks who got them splurged at PTA fundraisers.
Still, maintaining income tax rates at current levels, as Quinn wants, is critical to the financial well-being of the state’s schools, which would lose more than $600 million in general funds otherwise, according to budget documents. With the rates in place, the budget recommends a $291 million general funds increase.
Using the $700 million in net new cost for those rebate checks could boost that school spending increase to a billion dollars.
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Beware the radicals
Friday, May 2, 2014 - Posted by Rich Miller
* From an anti-fracking op-ed by William Rau…
Last year, I emailed Illinois legislators showing how the definition of high-volume horizontal fracturing in the Illinois Hydraulic Fracturing Act created a loophole exempting oil producers from the law. Legislators dismissed the warning and passed the Frack Act last May. Now, Denver-based Strata-X is preparing to frack a horizontal well next month with a permit filed under the old Illinois Oil & Gas Act.
The consequences? First, permit fees drop from $13,500 per well to $15 per well when Strata-X drills its 100-plus planned wells. Second, production taxes, which are 11 percent in North Dakota, drop from about 3 percent to one-tenth of 1 percent in Illinois with all revenue going to an oil promotion board. Counties can forget about receiving state funds for highway repairs.
Third, blanket bond moneys for plugging defunct wells and cleaning up well sites drop from $500,000 — already inadequate for preventing bond forfeiture — to $25,000. For 100 wells, that’s $250 per well, about 1/100th of actual plugging and cleanup costs.
Guess who will be stuck with the cleanup costs?
Finally, public notice requirements, baseline water testing, insurance provisions, modest environmental protections and setbacks, earthquake mitigation, bans on open pit storage of frack waste water, etc., are all gone.
* There’s also another claimed loophole. SJ-R…
Environmental groups dismissed draft rules released in November as riddled with loopholes favoring the oil and gas industry.
Opponents of the practice of using high-pressure water and chemicals to free oil and gas from rock formations also are pushing for a fracking moratorium in the spring legislative session.
“The big issue with us is the fact that we are pretty convinced the industry is already dry fracking,” said Annette McMichael, spokeswoman for Southern Illinoisans Against Fracturing Our Environment.
McMichael said dry fracking relies on nitrogen and propane to circumvent limits on the volume of water and chemicals permitted.
* I asked Mark Denzler of the IMA to respond…
Thank you for the opportunity to comment on Mr. Rau’s continued forays against energy development in Illinois. Mr. Rau and IPA are publicly on record as opposing any form of hydraulic fracturing in Illinois so his latest op ed is simply more of the same on this topic.
For the record, there are no loopholes in the Illinois law. The General Assembly, working in concert with industry, environmental community and the Attorney General’s office, crafted a strong law regulating the new generation technology known as high volume hydraulic fracturing. It’s interesting to note that a few days ago, the Bakken Shale in North Dakota and Montana reached a milestone of producing its 1 billionth barrel of oil while we continue to wait for the Department of Natural Resources to promulgate final rules.
The definition of a high volume hydraulic fracturing operation is 300,000 gallons of fluid (not simply water) or 80,000 gallons per stage. The total gallonage standard was a last second request by the environmental community during negotiations and inclusion of a conversion factor is being discussed as part of the rulemaking process. Generally speaking, HVHF operations use millions of gallons of water so in reality Illinois set a very low threshold in order to ensure that the new regulations captured a wide range of operations. these operations must comply with the new law. Illinois policymakers clearly wanted to delineate the difference between conventional wells and new HVHF wells and they took the time to do their homework to craft a law that recognizes the differences.
Secondly, Illinois set a very stringent standard by defining a horizontal well as one that deviates more than 100 feet from surface to bottom hole location. Nearly every well has deviation and Illinois’ definition is very strong.
The legislature was diligent in making sure the law was tailored to address precisely the types of unconventional operations that have been the subject of media and policy discussion in other states.
So, actually, there is sort of a loophole for “dry fracking” in the legislation, but the conversion factor between nitrogen or propane and water is currently under discussion.
Also, I’m told it’s very likely that Strata-X’s project can’t circumvent the current law. We’ll see, but the standards are pretty darned tough.
In other words, the sky most likely isn’t falling.
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Credit Unions – Paying it Forward in their Communities
Friday, May 2, 2014 - Posted by Advertising Department
[The following is a paid advertisement.]
Credit unions have a well-recognized reputation for providing exemplary service in meeting their members’ daily financial needs. A “People Helping People” philosophy also motivates credit unions to support countless community charitable activities on a continual basis. Financial Plus Credit Union is no exception, having raised and donated tens of thousands of dollars for many worthwhile causes throughout north central Illinois. This includes serving as the main sponsor and co-host of the local Easter Seals telethon, conducting food drives for local food pantries, collecting supplies during times of disaster such as last year’s flooding, and much more. Members are also seeing new donation canisters in the credit union’s lobbies this year that facilitate collections for a different local organization each quarter. Staff members has also come to the aid of the community via donating individual funds to help families facing significant medical crises, and purchasing holiday gifts on a private basis for foster children. Credit unions are able to wholly serve their communities because of their not-for-profit cooperative structure and leadership of a volunteer board elected by and from the local membership. Financial Plus has been family managed since its inception in 1951 and for the past 38 years under the leadership of Jack Teausant. Credit unions– locally owned, voluntarily led, and Paying it Forward in your community.
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Today’s numbers
Friday, May 2, 2014 - Posted by Rich Miller
* Jeff Ignatius looks at another reason why the progressive “Fair Tax” proponents might be better off waiting until next year, if, of course, the 5 percent income tax is made permanent…
• Compared to the pre-2011 flat-income-tax rate of 3 percent, the Fair Tax represents a tax break for only those whose net income is below roughly $13,150. (Over-simplistically, net income is total income minus the standard deduction of $2,100 per person in a household. So for a married couple with two dependent children, $13,150 in net income would be the same as $21,550 in total income.)
• Compared to the 3.75-percent income-tax rate that is scheduled to take effect on January 1, the Fair Tax plan represents a tax cut to taxpayers with net incomes up to roughly $21,740.
• Compared to the 5-percent income-tax rate that took effect in 2011 and is scheduled to expire at the end of this year, the Fair Tax plan represents a tax cut for those with net incomes up to roughly $202,630. This is the comparison that Fair Tax advocates are making with the promise of tax cuts for 94 percent of Illinoisans. (You can see how your income-tax picture looks in this scenario at FairTaxCut.com. Be sure to enter your total income before the $2,100-per-person standard deduction.)
Yet even if one compares the Fair Tax plan to the 5-percent rate, the tax cut is modest. At $180,000 of net income, a taxpayer’s bill under the Fair Tax plan would be $430 less than it is now – a tax cut of less than 5 percent.
As a percentage of taxes owed, the Fair Tax plan would benefit lower-income taxpayers most, but even then it would amount to only a few hundred dollars. (The tax cut doesn’t reach $300 until $50,000 of net income.) Still, for taxpayers with net incomes below roughly $62,000, it is a tax cut of more than 10 percent from what they’re currently paying.
The lower-income tax cuts are offset by tax hikes for higher incomes. A taxpayer with $1 million in net income will see a tax hike of $15,150 (more than 30 percent) compared to the current 5-percent-flat-tax rate, and $27,650 (almost 74 percent) compared to the scheduled 3.75-percent rate. At $300,000 of net income, the tax hike is $1,850 (more than 12 percent) compared to the 5-percent flat rate, and $5,600 (almost 50 percent) compared to 3.75 percent.
Thoughts?
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Grant probe is “not over”
Friday, May 2, 2014 - Posted by Rich Miller
* Tribune…
The former police chief of County Club Hills was sentenced Thursday to five years in prison for diverting $917,000 from a state job-training grant to help remodel her home, travel to Las Vegas and distribute cash to her family and friends.
Regina Evans, 51, tearfully begged U.S. District Judge Sue Myerscough to not “take my life away,” before the sentence was handed down. Federal prosecutors had sought a prison sentence of more than 10 years.
After the hearing, Assistant U.S. Attorney Timothy Bass said the investigation that led to Evans conviction and has also taken down former state Rep. Connie Howard, Jeri Wright, the daughter of the Rev. Jeremiah Wright, and a top state public health official, is ongoing.
“It’s not over,” Bass said.
* More on that last line from the Sun-Times…
Without naming names, [Evans’ lawyer, Lawrence Beaumont] lashed out at the prosecution during the hearing, accusing the government of having a “misguided vendetta” against her. He said she “made telephone calls” and wore a wire on behalf of the government in pursuit of other targets, but she didn’t deliver any prized political pelts sought by prosecutors.
“In my humble opinion, part of the prosecution in this case had some kind of vendetta against her because she refused to cooperate or didn’t cooperate the way they felt she should against some political people in Chicago. They seem to want to take that out on her, which in my opinion is inappropriate,” Beaumont said.
During testimony in her two-day sentencing hearing, U.S. Postal Inspector Basil Demczak indicated the government criminal investigation into grant fraud at the Department of Commerce and Opportunity remains ongoing.
Asked later to clarify those remarks, Bass said, “I can only speak for what’s in the record. Again, what’s in the record is what Inspector Demczak testified to, and that is this case arose from an investigation of DCEO’s employment opportunity grant program that was targeted at helping underrepresented persons, underprivileged minority persons in the Chicago-area community.
“The investigation involved not just looking at Ms. Evans as one grantee but the entire program and whether or not other persons, other grantees, or other public officials had engaged in any wrongdoing. Inspector Demczak testified that investigation is ongoing,” Bass said, declining to name any targets.
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A much better response
Friday, May 2, 2014 - Posted by Rich Miller
* One of the problems with some Republican opposition to House Speaker Michael Madigan’s bill to appropriate $100 million to help fund the construction of an Obama presidential library was that the GOPs set a rhetorical trap for themselves. For instance…
“We’re not opposed to the library, but we have lots of other needs,” [Republican Rep. Ed Sullivan] said, citing, for example, Emanuel’s push to outfit more city schools with air-conditioning.
“Do you want to pay for air conditioning in schools or a library? Do you want to pay for cops on the streets to stop the killing or do you want to pay for a library?” Sullivan said.
Statements like that made it appear that they could support big, new spending for Chicago.
* Sen. Bill Brady’s idea to allow Illinois taxpayers to contribute via income tax checkoff is much better…
“We absolutely want future presidential libraries to be built in Illinois. The Abraham Lincoln Presidential Library has proven to be a major tourist destination, bringing people from around the country and world to visit Springfield,” Brady said. “However, simply put, Illinois doesn’t have $100 million to spend on a presidential library. State funds are already spread too thin to pay off our debt, make upgrades to our roads and provide essential services.”
If approved, the tax check-off would appear on tax returns in 2015 with any proceeds going toward the construction of the library. If less than $100,000 is collected, the check-off would be eliminated.
* Even Madigan’s mouthpiece couldn’t say a whole lot in response…
Madigan spokesman Steve Brown said contributions to tax check-offs have been “spotty.” But he said the speaker welcomed the additional fundraising option.
“We thank Senator Brady for his endorsement,” Brown said.
Discuss.
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An Illinois tradition
Friday, May 2, 2014 - Posted by Rich Miller
* From the Twitters…
* Bill Cameron at WLS has more…
The feds in Springfield are now on the case investigating Governor Pat Quinn’s very controversial anti-violence program that the GOP calls a slush fund to buy black votes before the 2010 election.
This is the fourth Illinois governor in a row to be investigated by the feds. Before Quinn, governors Rod Blagojevich and George Ryan did time, or still is doing time, for selling their offices. Even Jim Edgar was probed in the MSI scandal, but survived the search.
Jim Thompson was not investigated, but he was the feds, having been the U.S. attorney who sent another governor to prison, Otto Keener, in a race track stock scandal. Governor Dan Walker did time, not for corruption, but for bank fraud after he was out of office.
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