* Wow, what a week. I’ve been telling people lately that I think I was put on Earth to cover this spring session. I hope it doesn’t wind up putting me in the ground. We all gotta take it easy every now and then, so rest up this weekend and I’ll talk to you Tuesday…
The governor’s office consulted with the Comptroller’s office, and the governor’s office developed an operational solution.
State agencies under the control of the governor’s office will withhold unfair share fees when processing payroll. Additionally, agencies will retain an amount of money equal to the withheld unfair share fees until the legal issues are resolved.
The fact that the Governor pro-actively took steps from the beginning to segregate the unfair share funds shows his respect for the legal process underway. Whether it’s the Comptroller or the individual departments that keep the ‘unfair share’ funds in reserve, the Governor is making sure that he is able to carry out his obligation to protect the constitutional rights of the people of Illinois while recognizing that this important issue will ultimately be decided by the courts.
So, instead of ordering the comptroller to violate state law and state contracts, the governor’s gonna do it himself.
Sheesh.
…Adding… To be clear here, the comptroller has no say-so or choice in this matter if Rauner’s agencies deduct the fair share dues before submitting payroll to the comptroller’s office.
*** UPDATE *** Earlier today, a commenter posted this…
There has been a surge in AFSCME locals for those with fair share status to convert to full union membership.
So, is this true? Is a backlash building? I asked AFSCME’s spokesman about it…
That’s what we’re hearing from our local unions – and there are more than 70 locals that represent state employees – as well as anecdotally on social media, etc, but we won’t have any hard numbers until membership cards come in.
*** UPDATE 2 *** Dan Webb is now officially off the case…
On Friday, Webb told the Sun-Times he could not represent the state on Rauner’s behalf in court due to conflicts. Rauner had said in his announcement on Monday that Webb’s involvement would be conditional on obtaining waivers.
“Like most major law firms, we have private clients with disputes with the state of Illinois. I could not work out the waivers,” Webb said. He told the Sun-Times he “reluctantly” had to call the governor’s office to decline. “I was grateful that they wanted to have me involved.”
Rauner has since tapped another high-profile attorney: Phil Beck. Most famously, Beck represented President George W. Bush and Vice President Dick Cheney in the Florida recount trial versus Democratic nominee Al Gore.
Beck’s involvement is destined to make some heads explode.
*** UPDATE 3 *** From Roberta Lynch at AFSCME Council 31…
“The comptroller is right to refuse to implement Gov. Rauner’s unlawful Executive Order regarding Fair Share. The governor’s response shows the lengths he’ll go to in his crusade to undermine unions.
“Clearly his mission is not to build up Illinois but tear down the institutions that provide a voice for working families in our state. He seems offended by the idea that workers who protect children, care for veterans, ensure safe prisons and provide other essential public services earn a decent living and have a voice on the job.
“Our state faces real challenges, yet Gov. Rauner devotes his time and energy to bizarre and illegal schemes to scapegoat workers and weaken their morale. His combative approach offers no path to work together for the common good.”
Governor Bruce Rauner announced today he has selected Jim Schultz, 55, as Director of the Illinois Department of Commerce and Economic Opportunity. Schultz’s experience in agribusiness and as a banking entrepreneur gives him the breadth of knowledge to develop and support businesses across the State of Illinois. He will bring 30 years of experience to the position.
Schultz is currently the chairman of Open Prairie Ventures, Inc., a company he founded in 1997. Open Prairie provides private equity services and manages more than $135 million in fund commitments.
Prior to founding Open Prairie Ventures, Schultz was the chairman and CEO of Telemind Capital Corporation. The company provides merger and acquisition guidance, and financial consulting services to businesses. Schultz assisted clients in a number of industries, including: software development, banking, manufacturing, retail, healthcare and entertainment.
Schultz earned his bachelor’s degree in business administration from Southern Methodist University in 1980. He holds a law degree from DePaul University and an MBA from Northwestern University.
Experience:
● Open Prairie Management, LLC., Founder and Chariman of the Board (1997-Present)
● Telemind Capital Corporation, Chariman/CEO (1990-2000)
● Prime Banc Corporation
o Chairman of the Board (1993-2001)
o Board Member (1993-Present)
● Pinnacle Ford-Lincoln-Mercury, Inc., Chairman and Founding Partner (1992-1996)
● Physicians Clinical Laboratories, Ltd., Chairman and President (1990-1993)
● Agracel, Investment Banking Parneter, General Counsel, CFO (1987-1992)
The incoming director of the Department of Children and Family Services said Friday that he got one clear message during his single meeting with his new boss, Gov. Bruce Rauner:
“He knows that it’s a problem agency,” said George Sheldon. “He seemed concerned and he also expressed a commitment to do what was necessary to fix the system. He’s totally aware of the need for change.”
Sheldon, 67, who was credited with efforts to reform Florida’s often-criticized Department of Children and Families when he ran that agency from 2008 through 2011, will be taking over the agency shortly after the Tribune’s “Harsh Treatment” series revealed that juvenile wards have been assaulted, raped and lured into prostitution at taxpayer-funded residential treatment centers.
During a 45-minute telephone interview from Florida, Sheldon said he warned Rauner that troubling headlines won’t cease with his appointment.
Friday, Feb 13, 2015 - Posted by Advertising Department
[The following is a paid advertisement.]
Credit unions are not-for-profit financial cooperatives. They were first exempted from federal income taxes in 1917 to fulfill a special mission as valuable and affordable cooperative alternatives to for-profit banks.
Even though credit unions are exempt from income tax, they still are subject to, and pay, property, payroll, and sales taxes, and a host of governmental regulatory supervision fees. Since their inception, credit unions have more than fulfilled their mission, as evidenced by Congressional codification of the credit union tax exemption in 1951 and 1998. Though the range of services has evolved to effectively serve their members in an increasingly competitive financial marketplace, the cooperative structure, which is the reason for their tax exempt status, has remained constant.
Nationally, consumers benefit to the tune of $6.6 billion annually because credit unions are tax-exempt. In Illinois, by most recent estimates credit unions annually provide nearly $205 million in direct financial benefits to almost three million members. In an era that continuously poses economic and financial challenges, credit unions remain true to one principle - people before profits - and represent a highly valued resource by consumers.
Friday, Feb 13, 2015 - Posted by Advertising Department
[The following is a paid advertisement.]
In the 1960s, court cases began highlighting the dangers of car design and the willful negligence of manufacturers in designing cars that they knew to be unsafe. Since then then the civil justice system has worked hand-in-hand with regulation to protect Americans, while spurring generations of safety innovations.
The drop in car crash fatalities is due in large part to the fact that cars are getting safer. For more information, click here.
Gov. Bruce Rauner’s appointee for Illinois Comptroller, Leslie Munger, won’t abide by his executive order setting aside “fair share” union fees without a court order.
It’s a decision that the state’s top lawyer is backing.
“We agree with the Comptroller,” Illinois Attorney General Lisa Madigan’s spokeswoman Natalie Bauer said in an email. “Fair share fees are constitutional under the current law and she must follow the law.”
That’s the same statement the AG’s office sent me yesterday.
(T)he governor’s executive order does not apply to other constitutional officers, according to Illinois Attorney General office chief of staff Ann Spillane.
“There’s no question that under the current law that fair share fees
are constitutional,” Spillane told the Sun-Times. “(Leslie Munger) can’t ignore validly-signed contracts. She is an independent constitutional officer, an executive order doesn’t change her conduct.”
Munger is charged with enforcing state statute and collective bargaining agreements unless or until a court order says otherwise, the Illinois Attorney General’s Office said.
* The Illinois Federation of Teachers responded after my item was published…
Following a Capitol Fax report that Comptroller Leslie Munger (R) and Attorney General Lisa Madigan (D) will not implement Governor Rauner’s Executive Order regarding fair share fees, IFT President Dan Montgomery issued this statement:
“As we said earlier this week, the Governor’s actions were a blatantly illegal abuse of his power, so we’re glad to see a bipartisan confirmation that the constitution still matters. A democracy does not allow one man to implement his ideological will as he chooses, and so Comptroller Munger and Attorney General Madigan rightfully put the law over politics. As he considers his upcoming budget plan, the Governor would be wise to do the same. Our state has serious financial challenges, and Governor Rauner’s out-of-touch, partisan attacks on middle class families and the unions who give them a collective voice isn’t the way to solve them. Let’s hope we can start working together in earnest next week.”
* From AFSCME Council 31 Executive Director Roberta Lynch…
“It is gratifying to know that two of our state’s constitutional officers are clearly committed to upholding the Constitution. That they include both a Democrat and a Republican shows that preserving the integrity of our democracy isn’t a partisan or political issue. No elected official has the right to place themselves above the law.
“We have said that Gov. Rauner’s executive order was clearly illegal, and meant solely to strip workers of their ability to have a voice in the decisions that affect their lives. State employees throughout Illinois will welcome Comptroller Munger and Attorney General Madigan’s determination that the order should not stand.
“We renew our pledge to work constructively with anyone of good faith to move beyond the governor’s polarizing attacks and begin to address our state’s real challenges.”
Laying groundwork for a potential 2016 bid, New Jersey Gov. Chris Christie told supporters in suburban Chicago on Thursday that he and first-term Republican Illinois Gov. Bruce Rauner could take similar approaches to running states with divided government.
Christie frequently visited Illinois last year to boost Rauner’s campaign as the then-Republican Governors Association chairman. Rauner, a venture capitalist, ousted Democrat Pat Quinn in November to become the state’s first GOP governor in more than a decade. Christie said that such support was critical in “tough neighborhoods” like Democrat-leaning Illinois and that challenges were ahead for Rauner, particularly in working with Democratic majorities in the state House and Senate.
“Bruce Rauner and I compare notes all the time in that regard,” Christie told a receptive crowd of nearly 1,000 people at a fundraiser in Rolling Meadows. “But what I’ve told him is, when you’re governor, you don’t have the luxury to say, `I won’t work with the other side.”‘ […]
Tickets to the 8th Annual Northwest Suburban Republican Lincoln Day Dinner cost $100 or $250 for a private reception and photo op with Christie. Organizers estimated they’d raise $150,000. Rauner did not attend the event.
“Rauner did not attend the event.”
Not mentioned in the story is that Rauner’s 2014 campaign manager is now working for Rand Paul’s presidential campaign.
Just sayin’, but that probably explains the absence.
Just days before Gov. Bruce Rauner unveils a budget that is expected to include few new revenues, one of the state’s leading taxpayer watchdog groups is proposing a sharply different path.
In a report issued [yesterday], Chicago’s Civic Federation proposes not massive spending cuts but a range of revenue hikes, including a partial rollback of the income tax cut that took effect on Jan. 1; expanding the sales tax base to include services; temporarily eliminating the sales tax exemption for food and nonprescription drugs; and taxing some retirement income.
The group also wants to slow spending growth to 2 percent from the recent 2.7 percent annual level but warns that much deeper cuts than that may be counterproductive. […]
[Civic Federation President Laurence Msall] said the federation looked for a way to balance the books and pay the state’s bills without making the roughly 20 percent across-the-board cuts in discretionary spending that would be needed. “We were not able to do it,” Msall said.
The plan likewise calls for austerity, and holding state spending. But it’s clear that cuts alone should not be the only response to the state’s deficit. According to the report, in order balance the budget through reductions alone, Illinois would need to slim spending by 25 percent… something that would “come at the cost of eliminating entire areas of State services or completely restructuring how Illinois government functions.”
1. Fix Fiscal Cliff in FY2015: Rather than sharply dropping income tax rates by 25% in one year, the State should retroactively increase the income tax rate to 4.25% for individuals and 6.0% for corporations as of January 1, 2015. The State could then provide additional tax relief by rolling back the rates on January 1, 2018 to 4.0% for individuals and 5.6% for corporations.
2. Control State Spending: The State should restrict discretionary spending growth from the 2.7% level shown in its three-year projections to 2.0%, closer to the rate of inflation. This could reduce total State spending by $1.3 billion over five years.
3. Broaden the Income Tax Base to Include Some Retirement Income: Out of the 41 states that impose an income tax, Illinois is one of only three that exempt all pension income. To create greater equity among taxpayers, the State’s income tax base should include non-Social Security retirement income from individuals with a total income of more than $50,000.
4. Expand Sales Tax Base to Include Services: Illinois should expand its sales tax base to include a list of 32 service taxes proposed by Governor Rauner. Due to the complexity of sourcing rules and collections for new businesses that are not currently required to collect sales taxes, it is estimated this expansion could take up to two fiscal years to fully implement.
5. Temporarily Eliminate Sales Tax Exemption for Food and Non-Prescription Drugs: To provide much-needed immediate revenue, the State should temporarily eliminate the tax exemption for food and non-prescription drugs. The State should apply the full 6.25% sales tax rate to food and over-the-counter drug purchases through FY2019 and then reinstate the exemption in FY2020 after the service tax expansion is fully implemented and the State’s backlog of unpaid bills is eliminated.
6. Expand the Earned Income Tax Credit to Provide Assistance to Low Income Residents: To help soften the impact of the State’s fiscal crisis on low income residents, the Civic Federation proposes an increase in the State’s Earned Income Tax Credit from 10% of the federal credit to 15% of the federal credit by FY2018.
Ways and Means Oversight Subcommittee Chairman Peter Roskam (R-IL) hosted his first hearing on protecting small businesses from IRS abuse. Roskam prompted IRS Commissioner John Koskinen to apologize for the agency’s longtime practice of seizing banks accounts of individuals and small businesses without any proof of wrongdoing.
Rep. Roskam: “Commissioner, the IRS grabbed these taxpayer by their throat and squeezed them…and nearly ruined them and made their lives miserable. Would you be willing today, on behalf of the IRS, to apologize for those taxpayers who were so abused?”
IRS Commissioner: “If they paid their taxes, they weren’t doing anything consciously illegal, and they got wrapped up in the system, that was a mistake and I apologize for that.”
* It wasn’t easy to get that apology. Roskam had to ask three times. Watch…
The Civil Asset Forfeiture Act of 2000, which was aimed at preventing money laundering, drug trafficking, or other crimes, has been criticized for enabling government agencies to use greatly reduced standards of evidence to seize assets. Agencies are able to confiscate and sell the property of individuals suspected of (but not necessarily charged with) a crime.
In his opening statement, Subcommittee Chairman Peter Roskam (R – Illinois) pointed out that the IRS has used the law “to seize the bank accounts of people suspected of ’structuring’ – that is, of making cash deposits worth less than USD10,000 to avoid reporting requirements.”
On April 12, 2013, the IRS seized every penny of a nearly $1 million business account held by Georgia gun shop owner Andrew Clyde.
His misdeed — if you can call it that: depositing business checks into his bank account in increments under $10,000.
A bipartisan group of lawmakers on House Republicans are on Wednesday preparing to shine a spotlight on the government’s practice of seizing small business civil assets without charging them with a crime, signaling a new oversight focus on an issue gaining more attention and hinting at new legislation backed by both parties.
In one instance, a U.S. attorney suggested to one witness’s attorney that he may be getting a harsher punishment because the witness spoke to the press, according to an email reviewed by POLITICO.
The IRS reviewed its policy last year and changed it after media reports about asset seizures. The agency will now typically ignore cases where the money doesn’t come from illegal sourcing, such as drug dealing, instead of seizing assets only on evidence of structuring.
* Yeah, well they’re still doing it, Roskam’s office says. And the IRS refuses to disclose to Congress or anyone else just exactly how many non-criminal asset seizures it does every year…
Structuring is “catching a lot of innocent people — a Mexican restaurant, a gas station, a dairy farmer,” [Roskam] said in his opening statement.
“Many people can’t afford a long, drawn-out fight, so they settle, handing over thousands of fairly earned dollars to the IRS — all without having done anything wrong,” Roskam said.
The IRS seized 147 accounts last year, Koskinen testified.
“In 60 percent of those cases, the owner of the asset never shows up, which shows that they obviously had a criminal activity going on.” [said IRS Commissioner John Koskinen] […]
Roskam said the IRS has too much power to seize assets, even if the agency doesn’t have adequate evidence of a crime.
“The IRS doesn’t have to give notice to the account-holder before seizing the assets. And the IRS doesn’t have to prove that the person is actually guilty of anything — just that the account probably is involved in structuring,” Roskam said.
So, in other words, in 40 percent of the cases, the asset owner shows up, which indicates that no criminal activity was “going on.”
After announcing a commission to scrutinize sentencing policy in Illinois, Rauner visited a prison: Logan Correctional Center, a women’s facility in Lincoln, about a half-hour north of Springfield.
It’s something his predecessor, former Gov. Pat Quinn, never did — even as an independent watchdog reported flooding, roof leaks and other problems with aging facilities.
Despite requests from activists, Quinn said he had a lot to do, and trusted his staff to manage the prisons.
I didn’t see this on the governor’s public schedule and the Lincoln Courier didn’t even have a story about the tour. That may be a good thing. He’s gathering info rather than seeking an easy press pop. The governor did tweet about it, though…
Very informative visit to Logan Correctional Center. Many problems to address. We have a lot of work to do pic.twitter.com/QDoHecuvzK
What: Governor Rauner Announces New Advisory Council on Innovation
Where: 1871
222 W. Merchandise Mart Plaza, Suite 1212, Chicago
Date: Friday, February 13, 2015
Time: 9:30 a.m.
Note: No Additional Media Availability
What: Governor Rauner Attends Grand Opening of New Health Tech Hub
Where: MATTER
222 W. Merchandise Mart Plaza, Suite 1230, Chicago
Date: Friday, February 13, 2015
Time: 10:30 a.m.
Note: No Additional Media Availability
What: Governor Rauner Delivers Keynote Address at America-Israel Chamber of Commerce Meeting
Where: Katten Muchin
525 W. Monroe, Suite 1900
Date: Friday, February 13, 2015
Time: 12:15 p.m.
Note: No Additional Media Availability
What: Governor Rauner Signs Executive Order on Government Consolidation
Where: DuPage Water Commission
600 E. Butterfield Rd., Elmhurst
Date: Friday, February 13, 2015
Time: 1:30 p.m.
I’m assuming this new EO forms yet another study commission. We’ll see.
* Meanwhile, this is a press release about the governor’s first stop today…
Governor Bruce Rauner visited 1871 today to announce the creation of the new Innovate Illinois Advisory Council, which he has formed to foster opportunity and increase Illinois’ global competitiveness. Following the announcement, Governor Rauner toured 1871’s 75,000-square-foot facility, held a roundtable discussion with startups from 1871 and MATTER, and visited the recently-opened MATTER space, which is immediately adjacent to 1871 in The Merchandise Mart.
“Illinois is home to a wealth of resources, including world-class educational institutions, leading national labs, 33 Fortune 500 companies, dozens of innovation and entrepreneurship hubs, a vibrant culture, and an extensive transportation network,” Governor Rauner said. “Yet our state continues to fall behind. In the last ten years, the Boston Consulting Group estimates our lagging growth has cost Illinois more than 175 thousand jobs. This council will help us create and implement a shared vision for a 21st century economy that will turn Illinois into a global innovation destination.”
The council will be co-chaired by Laura Frerichs, director of the University of Illinois’ Research Park, and Mark Glennon, managing director of Ninth Street Advisors. 1871 will participate.
Governor Rauner has charged the council with developing an agenda to grow the state’s innovation economy, including developing high-growth industry clusters, attracting resources, developing and retaining top talent, and fostering collaboration among all the parties in the state’s technology and innovation community. The council will meet regularly to develop and facilitate the execution of key growth initiatives. It will work closely with Illinois Department of Commerce and Economic Opportunity and will have a core mission of bringing new opportunities to the forefront on behalf of the community.
The Indiana Department of Transportation has formally suspended its work on developing the Illiana Expressway, pending a decision by Illinois Gov. Bruce Rauner on whether to proceed with the project.
A letter from INDOT project manager James Earl released to state Sen. Rick Niemeyer, R-Lowell, states Indiana will halt all Illiana Expressway work until the Rauner administration completes its review of the project.
On Jan. 12, Rauner froze spending on all major interstate construction projects managed by the Illinois Department of Transportation, including the 40 miles of the Illiana Expressway planned for Illinois.
Just a year ago, the planned 48-mile bi-state toll road appeared to be barreling toward construction. But Rauner’s action and his appointment of a transportation chief who opposed the road have heartened opponents who want the project killed.
In a letter sent to those who live near the proposed toll road, James Earl, Illiana project manager at the Indiana Department of Transportation, said that while the department “remains committed” to the project, it can’t participate without Illinois, which would build the western stretch of the road between I-55 in Illinois and I-65 in Indiana.
Although construction “will be managed separately by each state,” Earl wrote, “the Illiana Corridor is still a project that requires both states to work together and maintain similar schedules. Given the recent decision by the state of Illinois, INDOT is temporarily suspending project development until the Rauner administration completes its review of the Illiana Corridor.”
The Rauner administration has given no indication how long that review will continue. But it already has lifted the freeze on a variety of Illinois Tollway projects, and Randy Blankenhorn, the governor’s secretary of transportation, was a vigorous opponent of making Illiana a priority in his previous capacity as executive director of the Chicago Metropolitan Agency for Planning.
* Meanwhile, I heard last week that some folks who don’t want to see Blankenhorn run IDOT were shopping some oppo on him…
Gov. Bruce Rauner’s pick to run the state’s transportation agency was caught driving drunk more than a decade ago.
A spokesman for the governor said Randall Blankenhorn’s 2004 Sangamon County arrest has been disclosed to lawmakers and should not be considered an issue in his role overseeing the Illinois Department of Transportation and its anti-drunken-driving campaigns.
“Governor Rauner has full confidence in Randy Blankenhorn and knows he will be an effective secretary for the Department of Transportation,” wrote spokesman Lance Trover in an email Wednesday.
According to records reviewed by the Lee Enterprises Springfield bureau, Blankenhorn, 56, received court supervision after he failed a blood-alcohol breath test during a traffic stop in April 2004.
He paid for his decade-old mistake. If people want to oppose him over Illiana or his past support for cutting Downstate’s share of the Road Fund, fine. Otherwise, move the heck along.
Joint Statement from Illinois Early Childhood Advocates on Early Learning and the Child Care Funding Crisis
Governor Rauner pledged to “increase funding for early childhood education so that more at risk children can enter kindergarten ready to succeed” during his inaugural State of the State address.
We applaud this commitment to our state’s youngest and most vulnerable learners, and we look forward to seeing more details of the Governor’s early education plan in his Budget Address on February 18th.
The Governor also stated that “from cradle to career, our children’s education needs to be our top priority.” We could not agree more. For that reason, we call on Governor Rauner and the General Assembly to fully fund all aspects of early care and education — including child care.
High-quality, affordable child care is often the very first connection that young children have to an educational experience – in conjunction with, or even prior to, preschool. In addition to the work support it provides to parents and the economic impact it has on the state, child care is a critically-important step on a lifelong path of education.
To truly realize the Governor’s stated priority, the Illinois Child Care Assistance Program must be fully-funded – both to alleviate the $300 million funding crisis facing child care during this fiscal year and to ensure its viability in Illinois for the coming fiscal year. Now is the time for the Governor and the General Assembly to take bold and decisive action on behalf of Illinois’ children and families.
Fight Crime: Invest in Kids Illinois
Illinois Action for Children
Latino Policy Forum
The Ounce of Prevention Fund
ReadyNation Illinois
Voices for Illinois Children
The Ounce of Prevention Fund is, of course, headed by Mrs. Rauner.
