Moody’s Investor Service said in an announcement released Monday the [Sangamon County judicial ruling on pension reform], if upheld, would speed the growth of debt for one of one of the worst-funded pension systems in the nation.
“The state’s negative outlook indicates the possibility that factors such as further growth in the state’s pension liability will drive the rating lower still,” Moody’s stated.
Standard & Poor’s Rating Services said last week’s ruling would have no short-term effect as savings from pension reform were not included the fiscal year ended July 1, 2015.
“We will continue to monitor the legal process relating to pension legislation,” S&P stated.
* More from The Bond Buyer…
Fitch Ratings also said it had not factored in savings from the pension reforms in its rating assessment due to the legal challenge that was always expected to go to the state’s high court and state’s decision not to incorporate savings in fiscal 2015. “The ruling is not an immediate credit concern,” said analyst Karen Krop. “The state’s budget is a more immediate concern.” The state’s fiscal 2015 relies on one-shots and falls to cover a full year’s spending demands as lawmakers failed to approve an extension of the 2011 income tax rates that partially expire Jan. 1
“While maybe this ruling was to be expected, the bigger thing is going to be the temporary income-tax hike,” said Adam Buchanan, vice president of sales and trading at Ziegler, a broker-dealer in Chicago. “That, coupled with these pension issues, is really going to put some downward pressure on the rating.”
For now, rating companies want to see how the state will act. Standard & Poor’s said in a report after the pension ruling that it will maintain its A- rating and negative outlook on Illinois because the grade already incorporated legal hurdles. Karen Krop, an analyst at Fitch Ratings in New York, said this month that Rauner needs a chance to present his plan.
Illinois hasn’t issued general-obligation bonds since April, when it capitalized on a rally following the December passage of the pension measure to lock in borrowing costs close to the lowest since 2009.
Illinois’s yield spread to benchmark munis has shrunk since August as money pours into the $3.7 trillion market. Individuals have added to muni mutual funds for 19 straight weeks, the longest stretch since 2012, Lipper US Fund Flows data show.
More roller coasters ahead, campers.
- Posted by Rich Miller
* A guy is involved in a motorcycle accident, his passenger dies, he consents to a drug test and it turns up negative except for this…
The only positive test result was for benzoylecgonine, a metabolite of cocaine, which was found in both defendant’s blood and urine. A metabolite is a byproduct remaining in the body after metabolism has taken place.
In other words, he wasn’t high at the time.
* During his trial, jurors ask the judge for instructions. Is benzoylecgonine the same as a drug? If it is the same, then the guy is gonna get convicted. If it isn’t, then he has a chance at acquittal. The state’s attorney did not object to the defense counsel’s request that the judge state the obvious. The judge’s response…
“It’s not really a factual question or one about review of the evidence,” Kennedy said, according to a transcript in the appellate ruling. “It’s really a matter asking the court to give a legal definition and so the court should answer that as closely as possible by giving a direct answer and then explaining without alluding to facts in the answer, so the answer the court is going to give is, yes, cocaine metabolite qualifies as a drug, substance or intoxicating compound. … I believe that responds to their question and correctly states the law to them, so that’s the response that’s going to be given. I’m going to write that out carefully.”
As a result, Dana Hasselbring was convicted of DUI, even though there was clearly no “influence” involved with his driving.
* The appellate court reversed yesterday…
“Both the state and defendant agreed the trial court should answer the question by telling the jury to rely on the evidence it heard during the trial. The trial court’s unprompted response, ‘yes, cocaine metabolite qualifies as a drug, substance, or intoxicating compound,’ was incorrect, in conflict with the evidence presented, and served to direct a verdict in the state’s favor,” the ruling said.
“The better approach would have been for the trial court to accept the parties’ recommended response and instruct the jury to rely on the evidence it heard during the trial. Accordingly, we have no choice but to reverse defendant’s conviction and remand for a new trial.”
* But this is also from the opinion…
The State’s expert testified, “Benzoylecgonine is a cocaine metabolite. That means that at some point cocaine was ingested. It breaks down into metabolites. One of them is Benzoylecgonine, which we test for. It is similar to digestion. When you ingest food, it has to break down into other substances. Drugs are the same way.” (Emphasis added).
Looking at the evidence in a light most favorable to the prosecution, as we must, we find a rational jury could have found the benzoylecgonine in defendant’s system was a substance resulting from defendant’s use of cocaine before driving… Accordingly, double jeopardy does not preclude retrial of defendant.
So, he could very well go on trial again and lose again.
This goofy state law really needs to be changed.
*** UPDATE *** From an Illinois State Bar Association letter to the editor of the Pekin Times…
Under the current Illinois Vehicle Code, a driver who is not impaired is still guilty of a DUI offense or aggravated DUI offense if there is any trace of an unlawful drug in their blood or urine. So, if a driver smoked marijuana two weeks before an accident, it is still a crime even though a urinalysis can’t test for active THC metabolites, and the driver showed no evidence of impairment. In other words, smoking marijuana two weeks earlier had nothing to do with the accident.
This isn’t good policy. As the Pekin Daily Times recently stated, “The purpose of the DUI laws should be to punish people who drive under the influence of alcohol or or drugs. We don’t see any justice in punishing people who aren’t under the influence.”
Accordingly, ISBA Legislative Proposal 98-16 removes this absolute liability offense from the DUI statute and makes it a new separate Class B misdemeanor for a first offense and a Class A misdemeanor for a second or subsequent offense.
The proposal continues to make it illegal to use drugs to the extent that they result impairment under the current DUI statute. A conviction under this new statute would also parallel the DUI statute to require payment of the $150 DUI Analysis Fee and require a professional evaluation of the driver for substance abuse before sentencing.
The punishment must fit the crime. We join with the Pekin Daily Times and request you “fix the law so that those who are driving under the influence are punished but those who are clearly not impaired are not.”
- Posted by Rich Miller
* The Sun-Times ran a big, splashy headline the other day about how Speaker Madigan’s captains were passing petitions for Mayor Rahm Emanuel. Madigan was neutral four years ago, but Emanuel is now the incumbent, so of course Madigan is with hizzoner. That’s not exactly news.
But the paper also delved into the backgrounds of some of Madigan’s people. You wanna know how the machine is oiled? This is one way…
◆ [Patrick J. Ward], a key figure in the scandal that led to Alex Clifford getting a $718,000 severance package and leaving his post as Metra’s chief executive. Clifford accused Metra board members of forcing him out after he rebuffed Madigan about giving Ward a raise and refused to hire another Madigan loyalist. Ward left Metra and got a state job as a labor administrator after Madigan recommended him to Gov. Pat Quinn’s administration. Ward is paid $69,996 a year. As a retired city of Chicago employee, he also gets a $57,591-a-year city pension.
◆ Hugo Chavez and William E. Nambo, who were hired as “staff assistants” for the Illinois Department of Transportation under Quinn — a job class the state’s executive inspector general determined was designed to skirt anti-patronage hiring rules. Chavez resigned in May after a reprimand for an “unauthorized” absence from work in 2012 and for “insubordination” for bringing his dog to work last year against his boss’ orders, records show. Nambo gave $600 to Madigan’s ward organization four months after being hired at IDOT in April 2011. He now works in Republican Comptroller Judy Baar Topinka’s office.
◆ August A. Olivo, who has given $8,100 to the speaker’s ward organization and is the younger brother of former 13th Ward Ald. Frank Olivo. August Olivo, 52, is retired from the Cook County Highway Department and gets a pension of $81,204 a year. Since 2011, he’s been working for the CTA, where he makes $80,194 a year.
The 13th Ward has always been thus.
* In other MJM news, Crain’s published some recent quotes in an attempt to discern a Madigan agenda…
* From the story…
Michael Madigan is confronting the drawbacks of power.
The Illinois House speaker could spend some of his vast political capital on an ambitious Democratic agenda to tackle the state’s tough problems, with or without the cooperation of incoming Republican Gov. Bruce Rauner. Or he could minimize risks to his overwhelming majority through partisan standoffs and sidestepping meaningful votes.
Guessing Madigan’s true agenda is a popular drinking game in Springfield, but over the past year he has offered a wide range of proposals, including a surtax on millionaires, a hike in the minimum wage and making the 2011 income tax increase permanent to avoid severe budget cuts.
The question now is the extent to which Madigan will use his clout to address the state’s huge budget problems and other issues, persuading vulnerable members to take tough votes, as he did when the General Assembly passed pension reform and marriage equality last year.
You can bet the house (and the Senate) that his agenda will include taking care of his captains, as the Sun-Times story illustrates. At his very core, he’s a 13th Warder. It has always been thus.
- Posted by Rich Miller
* The list of Chicago candidate filings is here. Yesterday was the filing deadline. Greg Hinz has more…
Drawing a clear path to a new term, at a minimum of $106,558 a year (before extra stipends for committee chairs) were Ald. Marty Quinn, 13th; Ed Burke, 14th; Brendan Reilly, 42nd; and Harry Osterman, 48th. Ald. Patrick O’Connor, 40th, the mayor’s floor leader, drew just one opponent.
Burke, dean of the City Council, chairs the powerful Committee on Finance. Quinn comes from Illinois House Speaker Michael Madigan’s home ward, and Reilly represents the bulk of the central district. Osterman is from Edgewater and is a close Emanuel ally.
At the other end of the spectrum: the South Side’s 7th Ward, where 16 foes filed to take on incumbent Natashia Holmes, and the Northwest Side’s 38th Ward, where nine candidates have filed, including Ald. Nick Sposato, who decided to move to this ward after his 36th Ward was pretty much dismembered in a remap three years ago. There are also 14 candidates in the West Side 24th Ward, and 12 in the neighboring 29th Ward.
Overall, however, the number of candidates for alderman is off by about a third at this point, with 252 filing this year compared to 351 last time, according to the Chicago Board of Election Commissioners.
Ald. Reilly reported around a million dollars cash on hand in his two accounts.
* The Sun-Times looks at the mayoral filings…
In all, 10 people filed to run for mayor, including incumbent Rahm Emanuel.
Seven of them filed on Monday, including Cook County Commissioner Jesus “Chuy” Garcia, who turned in more than 63,000 signatures. William “Dock” Walls was the last filer at 5 p.m., according to the Chicago Board of Election Commissioners.
“I believe the city is not heading into the right direction, and I’ve heard that from people all over the city of Chicago,” Garcia told reporters after filing. “The fact that we submitted the highest number of nominating petitions underscores the change people in the city’s neighborhoods would like to see Chicago take.”
Ald. Bob Fioretti (2nd) also turned in his petitions on Monday. His campaign brought in 55,523 nominating signatures. Fioretti made note of the financial battle facing him and every candidate going up against Emanuel, who has upward of $9 million in his campaign war chest.
Amid chants of “Chu-y, Chu-y,” Garcia took another jab at the mayor’s closing of 50 schools.
“That’s the difference between me and the present administration,” Garcia said Sunday. “We believe in opening schools up.”
Just Friday, Garcia blasted the mayor over the move, portraying the incumbent as a big-money “Washington insider” who lacks the “temperament” to “listen and engage” everyday Chicagoans.
A spokesman for Emanuel said Sunday the decision to close a school is “very difficult.”
“But we cannot shy away from difficult decisions to move Chicago forward, to keep the rising graduation rates, the longer school day, and the full-day kindergarten,” Steve Mayberry said. “Last week, Commissioner Garcia said he would have closed some schools. Today, he says he would open them. In neither case did he offer any specifics. Voters deserve detailed, thoughtful plans, not inconsistent rhetoric from the sidelines.”
Garcia said he believed his 63,000 signatures were “challenge-proof,” before saying he would campaign on reducing gangs and gun violence, hiring more police officers, improving schools, creating jobs, reducing the city’s deficit and addressing its looming unfunded pension obligations.
The Cook County commissioner, however, offered no specifics on how he’d achieve those improvements and would not take questions from reporters, even as they followed him through the Dunne Cook County office building, into the city’s underground pedway and through another nearby office building. […]
Emanuel had nearly $8.7 million in his campaign fund through the end of September and has raised at least $328,000 since then, according to state campaign finance records. Fioretti had $258,000 in his fund at the end of September and has raised about $52,000 since, records show. Garcia, a late entrant to the race, did not open a mayoral campaign fund until Nov. 6 and has collected $214,000 since, almost all of it from unions representing teachers and Chicago Transit Authority workers.
* And the lede of the day…
West Side aldermanic candidate Gabe Beukinga sent a series of accusatory and threatening emails to a major developer in his ward Friday. Monday, Beukinga, a Chicago businessman, says that while he regrets the emails he sent while he was drunk, he has decided to quit his day job to concentrate on his drinking relapse problem and to run for 27th Ward alderman.
- Posted by Rich Miller
|Question of the day
Tuesday, Nov 25, 2014
* I usually do the question later in the day, but I’m running a bit behind this morning, so let’s do it now…
To celebrate Illinois Statehood Day on Wednesday, December 3, the Illinois State Society is hosting a reception and short program in the U.S. Capitol’s Visitor Center (1 First St., SE, Washington, D.C.). December 3 is the 196th anniversary of Illinois becoming the 21st state in the union in 1818.
The event from 6 p.m. to 8 p.m. will be in room 201 A/B on the House side of the Visitor Center. It is open to the public and the media.
U.S. Senator Mark Kirk (R-IL), a former naval officer and honorary chairman of the event, will introduce a special guest, Commander Jess Porter of the U.S.S. Illinois (SSN 786), a new nuclear submarine now under construction. This is the first Navy vessel to be named after Illinois in 70 years.
Commander Porter will give details on the new Virginia-class submarine, expected to be delivered from the Electric Boat division of General Dynamics in Newport News, Virginia, in August 2016.
The U.S.S. Illinois is the third in the Block III of nuclear subs. It will feature a revised bow, and other advance technology from Ohio-class SSFNs. The first group of sailors reported for duty in June 2013. The contract to build her was awarded in December 2008.
* The Question: What other ways should Illinois celebrate its birthday? Snark heavily encouraged, of course.
- Posted by Rich Miller
Tuesday, Nov 25, 2014
* A tiny handful of you old-timers may recall my big, yellow, 1973 Cadillac, which was affectionately named “Althea.” I sought and successfully obtained an unofficial dispensation from the Illinois Environmental Council to own that gas-guzzling beast because it was just so cool. This one’s for those who remember…
Ain’t nobody messin’ with you but you
- Posted by Rich Miller
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