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*** UPDATED x2 - Emanuel says “No” *** Is the pressure off?

Monday, Jun 29, 2015

* Combine this accelerated state payment with CPS’ billion dollar loan - $200 million of which is a credit line - and this takes a lot of the pressure off the House to pass the 40-day pension payment extension bill

Gov. Bruce Rauner is offering to accelerate state grant payments to help cash-strapped Chicago Public Schools make a $634 million pension contribution, according to a summary of the proposal obtained Sunday by The Associated Press.

The document, prepared by the Rauner administration, states the Illinois State Board of Education has identified $450 million in grants that normally would be distributed to CPS over the course of the fiscal year that could be provided as early as this week. The advance wouldn’t require legislative approval. […]

Madigan said there was controversy around the bill but said the House would vote on it again when lawmakers return to Springfield on Tuesday.

Such a vote wouldn’t be necessary if Emanuel and CPS take Rauner up on his offer, but it was unclear late Sunday what the next steps will be.

…Adding… It’s worth pointing out that this plan would use FY 16 money to pay an FY 15 bill, which could just make things worse for CPS. Stay tuned.

*** UPDATE 1 *** As expected

“We appreciate the governor’s gesture, but the use of this year’s dollars to pay last year’s pension payment follows the same path that got the schools into the current financial mess,” mayoral spokeswoman Kelley Quinn said. “We need a real solution like Gov. Rauner’s proposal last week—pension parity and funding relief so that Chicago schools are finally treated like every other district in the state.”

*** UPDATE 2 *** Mike Schrimpf…

The governor has proposed a long-term solution and stands ready to work with the Mayor and legislative leaders on passing a comprehensive plan to fix Chicago’s finances. The governor’s plan provides the city with short-term relief while we wait for Speaker Madigan to get serious about reform and helping the people of Illinois.

- Posted by Rich Miller        

54 Comments
  1. - Apocalypse Now - Monday, Jun 29, 15 @ 8:50 am:

    Ah, all those people criticizing Rauner for being unwilling to compromise and work with the Democrats. Let’s see how the Democrats, react to this.


  2. - chi - Monday, Jun 29, 15 @ 8:55 am:

    =Ah, all those people criticizing Rauner for being unwilling to compromise and work with the Democrats. Let’s see how the Democrats, react to this.=

    Well he hasn’t been, up till now. And if he’s not bluffing, making crazy demands in return for it, etc., it may just mean the criticism is starting to take hold. But let’s not pretend he’s been anything short of obstructionist to this point.


  3. - From the 'Dale to HP - Monday, Jun 29, 15 @ 8:57 am:

    Why is Rauner going out of his way to help CPS? Something doesn’t add up here… or is Rauner losing? Does Rauner not have the back bone to go through with all of this?


  4. - Hoping for Rational Thought - Monday, Jun 29, 15 @ 9:00 am:

    Both Rauner and Madigan have been more worried about winning not about the people affected. Madigan could have passed the CPS delay bill last week. This nonsense in the press about how he doesn’t intervene and people vote on their own. Anyone under the Dome knows that is NOT how it works. This is a power of wills and Madigan and Rauner both have plenty of blame to share. But never forget the felon Blago put us on this path and Quinn failed to do anything which made things worse.


  5. - A guy - Monday, Jun 29, 15 @ 9:01 am:

    From the beginning, Rauner has proclaimed a very strong commitment to education. He’s maintaining that posture. Anything that can be done without having to detour through the OK Corral is worthwhile.

    Good policy here.


  6. - Umm like - Monday, Jun 29, 15 @ 9:02 am:

    He’s bailing out a Dino that he bought and paid for. He didn’t make him a rich man to fail at his first attempt at the executive level. What’s the term? Politics as usual.


  7. - Oswego Willy - Monday, Jun 29, 15 @ 9:05 am:

    Is this an “Offer he can’t refuse”?

    Rauner is fully committed to taking schools off the table in causing him, Bruce Rauner, duress.

    That’s why he signed the Ed Approp Bill, over the GOP GA being hung out. Rauner shores up Chicago schools too, it puts Rauner in a less stressful position when it comes to the budget, his own Turnaround Agenda, AFSCME, and shutting down Illinois.

    Kids in school takes loads off Rauner’s shoulders. Why? Rauner owns all his decisions, actions, inactions, and deferrals of his options. This move, it’s great for Rauner and the schools, but there’s always another shoe dropping.


  8. - Same as it ever was . . . - Monday, Jun 29, 15 @ 9:07 am:

    @ A guy

    Using FY 16 money to pay an FY 15 bill is good policy?


  9. - lake county democrat - Monday, Jun 29, 15 @ 9:07 am:

    @Hoping - If I understand the pro-Madigan argument, it’s 1) Governors historically get blamed/credited with budgets, 2) No matter how popular any items on Rauner’s turnaround agenda are with the public and despite their being no legal reason why Rauner can’t link them to his willingness to compromise, #1 means nobody should ask or expect Madigan to compromise and 3) What? The Democrats have supermajority status and can negotiate and pass whatever they want to? Just move along, nothing to see here.


  10. - Same as it ever was . . . - Monday, Jun 29, 15 @ 9:17 am:

    If Bruce Rauner had been willing to use his line item veto powers to whittle down $36 billion to $32 billion, we’d have a balanced budget and there would be no pending drama.


  11. - A guy - Monday, Jun 29, 15 @ 9:20 am:

    ===Same as it ever was . . . - Monday, Jun 29, 15 @ 9:07 am:

    @ A guy

    Using FY 16 money to pay an FY 15 bill is good policy?===

    Mr/Ms. Same…, this is what I read:

    Gov. Bruce Rauner is offering to accelerate state grant payments to help cash-strapped Chicago Public Schools make a $634 million pension contribution, according to a summary of the proposal obtained Sunday by The Associated Press.

    Helping them make their payment by accelerating the payment. Seems to assist on several different fronts. Yes, it’s good policy.


  12. - Anonin' - Monday, Jun 29, 15 @ 9:22 am:

    So it appears TeamBungle got flushed out a little…hmmm, but probably not enough. They forgot there are more kids in IL than the ones on summer break. Maybe one more bobble and no one gets screwed.


  13. - Apocalypse Now - Monday, Jun 29, 15 @ 9:24 am:

    =
    If Bruce Rauner had been willing to use his line item veto powers to whittle down $36 billion to $32 billion, we’d have a balanced budget and there would be no pending drama.=
    If Madigan and Cullerton had passed a balanced budget, as required by the State Constitution, there would be no pending drama.


  14. - Demoralized - Monday, Jun 29, 15 @ 9:24 am:

    A guy:

    I’m not sure doing something illegal (if it is indeed using FY16 money to pay FY15 bills) is good policy. If that is the case then the Comptroller should reject the payment request from ISBE. I guess we’ll soon find out.


  15. - Oswego Willy - Monday, Jun 29, 15 @ 9:27 am:

    - Apocalypse Now -

    Governors are responsible for budgets. That’s literal. It’s literally IN the state’s constitution.

    Rauner couldn’t get 60/30 for Rauner’s “sham” February budget, and The Rauner Veto reinforces that Rauner, the governor, owns a budget.

    Please learn.


  16. - Wensicia - Monday, Jun 29, 15 @ 9:29 am:

    Increased spending and kicking the can down the road? Rauner owns that now, too.


  17. - SouthernILGirl - Monday, Jun 29, 15 @ 9:34 am:

    I guess that not all Chicago machine politics are bad? So much for reviling that nasty Chicago political cronyism Mr. Rauner.


  18. - A guy - Monday, Jun 29, 15 @ 9:38 am:

    ===Demoralized - Monday, Jun 29, 15 @ 9:24 am:

    A guy:

    I’m not sure doing something illegal (if it is indeed using FY16 money to pay FY15 bills) is good policy. If that is the case then the Comptroller should reject the payment request from ISBE. I guess we’ll soon find out.===

    Demo, other that this person’s comment, I haven’t seen anything that suggests which year’s budget it’s coming from. I’m hoping for someone to provide clarity on that.

    The policy I’m referring to is accelerating the payment to avert a more costly problem.


  19. - A guy - Monday, Jun 29, 15 @ 9:39 am:

    Sorta hard to please some of you here. You’re not even happy when you get what you’re demanding. Hmmm.


  20. - Rich Miller - Monday, Jun 29, 15 @ 9:40 am:

    === I haven’t seen anything that suggests which year’s budget it’s coming from===

    Read the story, man. The money is coming from next fiscal year’s money.


  21. - Liberty - Monday, Jun 29, 15 @ 9:50 am:

    Using next years money is a SHAM.


  22. - Demoralized - Monday, Jun 29, 15 @ 9:58 am:

    If the payment is due June 30 then you can’t use FY16 money to pay it. I don’t know how much cash CPS has on hand but if they happened to have enough to go ahead and make the payment with the understanding that on July 1 a payment of $450M would be processed to them then it becomes a shell game that would satisfy the law.


  23. - DuPage - Monday, Jun 29, 15 @ 9:58 am:

    Giving CPS grant money for different then intended use? What will happen later in the year to the programs that money was originally supposed to pay for? Where/how will CPS get money to replace it?


  24. - chiagr - Monday, Jun 29, 15 @ 10:03 am:

    At least the Governor is offering help. But isn’t kicking the can down the road- no different then what the Democrats have done for years? they need help badly-maybe he will approve a Casino to deal with the issue down the road?


  25. - qualified someone nobody sent - Monday, Jun 29, 15 @ 10:04 am:

    Let’s all try and understand that Gov. Raunger is trying to help his “friend” the Mayor out of a tight spot. Depending on the GA to bail out CPS is a bad risk. Don’t they have much more pressing issues? Gov. Raunger is also using this as an opportunity to go around the power of the Speaker. When the money is supposed to be used seems irrelevant because with out a complete structural reform of State school disbursements and an ability to get around PTELL, CPS is doomed either now or in the near future.


  26. - Oswego Willy - Monday, Jun 29, 15 @ 10:07 am:

    === But isn’t kicking the can down the road- no different then what the Democrats have done for years?===

    But, but… Rauner is stopping… business as usual…


  27. - Norseman - Monday, Jun 29, 15 @ 10:10 am:

    Short term fix which could lead to a longer term problem. Sounds like business as usual.


  28. - Norseman - Monday, Jun 29, 15 @ 10:11 am:

    Willy, you beat me to it.


  29. - Formerly Known As... - Monday, Jun 29, 15 @ 10:13 am:

    ==use FY 16 money to pay an FY 15 bill==

    After CPS already used two months of FY 16 money to fund their FY 15 school year?

    This helps relieve some of the pressure, but CPS is in over their heads.


  30. - Formerly Known As... - Monday, Jun 29, 15 @ 10:16 am:

    ==Both Rauner and Madigan have been more worried about winning not about the people affected.==

    Bingo.


  31. - A guy - Monday, Jun 29, 15 @ 10:22 am:

    +++Rich Miller - Monday, Jun 29, 15 @ 9:40 am:

    === I haven’t seen anything that suggests which year’s budget it’s coming from===

    Read the story, man. The money is coming from next fiscal year’s money.++++

    Got it man…is it illegal or not?


  32. - Rich Miller - Monday, Jun 29, 15 @ 10:27 am:

    ===is it illegal or not===

    Nope. Just kinda unwise.


  33. - Demoralized - Monday, Jun 29, 15 @ 10:38 am:

    ==Nope. Just kinda unwise.==

    It would violate the State Finance Act so it’s sorta illegal.


  34. - A guy - Monday, Jun 29, 15 @ 10:44 am:

    kinda, sorta, confusin’


  35. - James - Monday, Jun 29, 15 @ 10:49 am:

    My take on the generosity: Both the Governor and the Mayor have a problem with unions. The Governor wants the Mayor to be more complicit in supporting municipal bankruptcy legislation–and, if passed, to use the threat of bankruptcy as a restructuring device to force the unions to comply with undesirable terms.


  36. - Demoralized - Monday, Jun 29, 15 @ 10:59 am:

    See 30 ILCS 105/25. Expenditures from an appropriation are limited to the fiscal year in which they occurred (i.e. July 1 - June 30). There are some exceptions but this isn’t one of them. So, if the payment is really due on June 30 then you couldn’t (or shouldn’t be able to) use FY16 funds to pay it. If they could get the payment due date changed to July 1 then they’d be ok.


  37. - Demoralized - Monday, Jun 29, 15 @ 11:00 am:

    Should have said “are limited to the fiscal year in which the goods or services were provided.”


  38. - Juice - Monday, Jun 29, 15 @ 11:51 am:

    Demoralized, the effective date of the approp bill isn’t until July 1, so they must be advancing the money all within FY ‘16, versus making the payment today or tomorrow as had been implied.


  39. - Norseman - Monday, Jun 29, 15 @ 11:59 am:

    The Mayor says no to the advance so he can proceed with his triangulated approach to reduce pensions. Mike - what say you.


  40. - DuPage - Monday, Jun 29, 15 @ 12:07 pm:

    This reminds me of the magician with a ping pong ball under the paper cups, moving them around until nobody is sure where the ping pong ball really is. An illusion. Chicago is going to have to raise their low tax rate. Rauner is trying to postpone CPS running out of money just long enough so it does not happen at the same time of a possible state shutdown. Otherwise people would link Rauner to the Chicago tax increase.


  41. - Frenchie Mendoza - Monday, Jun 29, 15 @ 1:01 pm:

    Schrimpf’s rejoinders are beginning to sound a bit hollow — as if he’s shouting at a crowd that’s actually not paying any attention to him anymore.


  42. - Wensicia - Monday, Jun 29, 15 @ 1:33 pm:

    Rauner camp: Noun….verb….Madigan.


  43. - Anon. - Monday, Jun 29, 15 @ 2:22 pm:

    ==The Governor wants the Mayor to be more complicit in supporting municipal bankruptcy legislation–and, if passed, to use the threat of bankruptcy as a restructuring device to force the unions to comply with undesirable terms.==

    That would be some game of chicken. You never know what you’ll get out of bankruptcy, but why would the union accept a contract that puts all of the cuts necessary to balance the budget on its members when bankruptcy will force all creditors to take a haircut?


  44. - Oswego Willy - Monday, Jun 29, 15 @ 2:35 pm:

    To the Update;

    ===The governor’s plan provides the city with short-term relief while we wait for Speaker Madigan to get serious about reform and helping the people of Illinois.===

    Triangulation continues…


  45. - siriusly - Monday, Jun 29, 15 @ 2:52 pm:

    If you are in the act of proposing a sham - are you shamin’ ?


  46. - Rod - Monday, Jun 29, 15 @ 2:56 pm:

    On May 5th Governor Rauner said this before the Chicago City Council: “We don’t have the money to simply bail out Chicago. That’s not an option.” So now he found the money at least for CPS, at least for the moment. So it now becomes an option, right?


  47. - Salty - Monday, Jun 29, 15 @ 3:21 pm:

    Wouldn’t the pension bill that was proposed last year do essentially the same thing? It would delay payment until the first GSA payment of FY2016. That money should be used for the 2015-16 school year not the last year. I fail to see the difference between the bill the Mayor supported last week and the Governor’s suggestion.


  48. - Commonsense in Illinois - Monday, Jun 29, 15 @ 3:37 pm:

    That’s right…keep poking Madigan…go ahead keep it up. In my 40-year career I’ve never seen the Speaker erupt and I’ve never wanted to. But, by golly that just might change.


  49. - Juvenal - Monday, Jun 29, 15 @ 4:52 pm:

    Team Rauner is blinking so much I am beginning to think it is Morse Code:

    SOS

    WILLY WAS RIGHT STOP

    GOVERNORS OWN BDGTS STOP

    MUST AVERT DOOMSDAY STOP


  50. - Mokenavince - Monday, Jun 29, 15 @ 5:40 pm:

    I really think Madigan may not know how to get out of this. He may be torn between unions and his law practice. He doesn’t want to hurt either.
    Were in a Rubic’s and got us their and seems stymied.


  51. - Oswego Willy - Monday, Jun 29, 15 @ 6:01 pm:

    - Juvenal -,

    It’s a bit comical, isn’t it?

    Rauner wants to bury AFSCME, and will go to mat to make sure they get paid, wanting to be, AFSCME’s hero.

    Rauner despises not being liked, more than Rauner despises Unions.


  52. - Mama - Monday, Jun 29, 15 @ 6:09 pm:

    How can you legally advance the money within FY2016? Is the Grant money federal or state funded?


  53. - Carhartt Representative - Monday, Jun 29, 15 @ 7:12 pm:

    =they need help badly-maybe he will approve a Casino to deal with the issue down the road?=

    That’s already earmarked for police and fire pension


  54. - JS Mill - Monday, Jun 29, 15 @ 8:59 pm:

    Rauner has a problem he cannot solve unless he uses “shenanigans”. CPS is a fiscal beast with a deep hole (courtesy of former mayor Daley) and no efficiency or waste removal is going to fix it. Steal next years money (most of us have to issue tax anticipation warrants but CPS is special, seriously) to cover this years problem really does not solve anything.

    listen closely…YOU HAVE TO RAISE REVENUE. Period.

    The governor said he would not bail out CPS. What is he offering here and what is he requiring in return if it is not a bail out.

    And, Now the governor wants to cap tax levy’s while not fully funding schools at the 2008 level.

    This guy is a mess, and he does not understand or know how to prioritize real public education. Anyone can have a pre-k or charter school as a hobby. This is a different ballgame and he is over his head.


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