* Check out the governor’s Q&A with reporters today. Classic BVR, from his goals as governor to his bashing of Illinois’ current economic climate…
…Adding… Tribune…
Gov. Bruce Rauner unveiled a new program Tuesday aimed at helping minority and women entrepreneurs grow their businesses, saying African-Americans didn’t come to Chicago “because we had a great welfare system or a great minimum wage,” but because they were seeking opportunity that has since “bled away.” […]
Asked if the state could make a greater impact by recruiting large, established businesses into struggling minority communities, Rauner said the focus instead should be on improving opportunity.
“The money follows the opportunity, and that’s what we got to get across,” Rauner said. “Here’s what’s happening. African-Americans are in Chicago in massive numbers. They didn’t come here because we had a great welfare system or a great minimum wage. That’s not why they’re here. That’s not why the people of Illinois are here. We’re here for opportunity.”
He continued: “Chicago used to be one of the greatest cities in the world, one of the fastest growing, most economically dynamic cities in the world. That’s why we’re all here. That’s why my ancestors, my grandparents — great grandparents — came to Chicago. That’s why our families are here. That opportunity is being bled away. It’s not about a government program. It’s not about more government money. We are not competitive in Chicago. We’re not competitive in the state of Illinois.”
* AP…
Gov. Bruce Rauner says he thinks General Electric bypassed Illinois for its new headquarters because of the “trajectory” of the state’s fiscal problems. […]
Rauner says company officials didn’t want to go from “one failed state to another.” He cited Connecticut’s property taxes, income tax and pension problems.
It’s amazing to me that he can say stuff like this without ever thinking that maybe, just maybe, he’s at least partially to blame for our alleged “failed state” situation.
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* Press release…
Sen. Daniel Biss (D-Evanston) today called on Gov. Bruce Rauner to seek to renegotiate lucrative interest-rate swap deals that send $6 million in taxpayer money to big banks every month at the expense of Illinois’ poorest residents and struggling college students.
An alarming new report indicates the state of Illinois is engaging in the same kinds of interest-rate swap deals that crippled the finances of the City of Chicago and Chicago Public Schools. So-called “swap” arrangements perversely penalize the state for low interest rates caused by the global financial crisis.
Illinois has spent $618 million on such swaps already, and the total cost to taxpayers could climb to $1.45 billion by 2033, when the deals are set to end. In addition, according to the report, taxpayers could be on the hook for $124 million in termination penalties as soon as November, depending on how long budget negotiations are delayed.
Biss noted that a great deal of harm is being done to the state’s most vulnerable residents – the poor, the elderly, the disabled and struggling college students – as a result of the current budget impasse.
“In this environment we have an obligation to pursue every possible avenue to relieve fiscal pressure, and if seniors, children and the disabled are being forced to sacrifice, then there’s no reason for Wall Street to remain untouched,” Biss said. “We in the legislature have a responsibility to the people of Illinois to explore these questions and do our best to recover any legally available funds.”
* The International Business Times has a very good article on this…
An interest rate swap is type of financial derivative that allows a bond issuer — like the State of Illinois — to limit or manage exposure to fluctuations in interest rates. The issuer pays a fixed interest rate on a floating-rate bond. The bank on the other side of the swap pays the variable rate and pockets the difference between the fixed and floating rates.
When Illinois first entered into the now-costly swap deals in the early 2000s, the intention was to hedge risks and save money on the billions of dollars in variable-interest bonds that state agencies had issued. These bonds, issued under former governor Rod Blagojevich, are pegged to fluctuations in the broader interest rate environment.
But in order to lock in what state financiers saw as bargain interest rates, the governor’s office entered into swap agreements with ten major Wall Street banks. Under the deals — which are commonplace in the corporate world — the state would pay the banks a fixed interest rate, while the banks paid bondholders the variable rate. In theory, the maneuver would protect the state from sharp interest rate moves.
When the stock market crashed and the Fed lowered interest rates virtually to zero, the state couldn’t refinance at the lower rate. “The swaps kept the state locked into rates nearly 4 percent higher than what its bank partners were paying bondholders,” the article states.
* Back to the article…
The state has paid $618 million in swap fees since 2003, according to the ReFund America report, with another $832 million yet to come. While Ciccarone noted that those totals include the interest Illinois would have otherwise paid on the variable-interest bonds, they also include tens of millions of dollars in additional costs related to the complex requirements that swaps entail.
Those fees might not be all. Today, with interest rates still scraping historic lows, termination fees totaling $286 million prevent the state from exiting its swap agreements.
* And the study says that more problems are likely heading our way…
The swaps can still get a lot worse: If the state’s credit rating continues to tumble and it is unable to renew its credit enhancements on the 2003B bonds in November 2016, that could trigger termination clauses on the Governor’s swaps and force the state to pay $124 million in penalties to the banks.
JPMorgan Chase is both a credit enhancement provider for the 2003B bonds and a counterparty to one of the related swaps. This would potentially put the bank in a position to be able to collect termination penalties on the swap by refusing to renew the credit enhancement—a tactic the bank has used elsewhere in the past.
$124 million is not chump change. Go read the whole thing.
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*** UPDATED x1 *** Message received?
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* Dan Proft, writing in the Tribune over the weekend about how he wants Bruce Rauner to get tough with AFSCME and other unions…
This is Rauner’s moment of truth.
Even more important than a fiscal-year budget is sending the unmistakable message to AFSCME (and its SEIU and teachers’ union cohorts) that the balance of the nearly 13 million residents of Illinois not in their ranks do not exist as spare parts for the machine that spits out compensation packages 27 percent higher than their own.
If that involves a siege on Springfield like Wisconsin Gov. Scott Walker confronted in Madison, so be it.
If that requires layoffs and outsourcing of state work to contractors, so be it.
If that requires losing an election, so be it.
Rauner ran for governor saying he is not a politician. He said he is a businessman who will make the difficult decisions to turn around the state he loves.
We’re about to find out if that’s true.
* Well, today Turnaround Illinois, which is funded mainly by Gov. Rauner and Sam Zell and has as its officially stated purpose “To support state legislative candidates who support Gov. Rauner’s bold and needed reforms, and to oppose those who stand in the way,” made a big contribution to Liberty Principles PAC…
Proft is Liberty Principles PAC’s chairperson and treasurer.
Rauner has essentially just outsourced a huge chunk of his legislative campaign agenda to Proft.
*** UPDATE *** To put this into some perspective, the governor just gave Proft more money than either of the GOP chamber leaders have on hand…
House Speaker Michael Madigan and Senate President John Cullerton controlled a combined $13.25 million warchest to begin 2016.
Heading into a critical election year of House and Senate races, the Democrats who lead the Illinois General Assembly have assembled a combined $13.25 million warchest to begin 2016, state campaign finance records show.
Veteran House Speaker Michael Madigan had $8.5 million to start the year in the four campaign funds he controls, records showed, while Senate President John Cullerton had $4.75 million in the three funds he operates.
That compares to $1.2 million in campaign funds controlled by House GOP leader Jim Durkin and $1 million in campaign funds authorized by Senate GOP leader Christine Radogno, according to reports filed with the State Board of Elections.
To put this in further perspective, Proft now has more than twice as much money stockpiled than Durkin and Radogno combined.
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Um, maybe not
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* Tom Kacich…
If you’re looking for something good amid all the rotten news in Illinois, here’s a little something: Gov. Bruce Rauner says there’s some agreement on the fundamentals of a pension reform plan.
That’s not to say that a deal is imminent, he cautioned.
“The president of the Senate (John Cullerton) and I agree on what it’s going to take to have a constitutional pension reform, and the speaker’s staff is not disagreeing. I can’t say they’ll be out there proactively being positive, but they’re not really disagreeing. And that’s a big deal,” Rauner said.
It’s a big deal if it gets worked out, resulting in “billions of dollars in pension savings at the universities as well as school districts and state government,” the governor said.
But state employee unions already indicated opposition to Cullerton’s plan, which is said to include a provision that makes employees choose between retaining cost-of-living increases in retirement or taking pay raises now. That may not be the offer made to employees.
* So, I reached out to Cullerton’s press secretary John Patterson. His response…
“There are still major differences regarding the recognition of collective bargaining rights.”
* And here’s Speaker Madigan’s spokesman Steve Brown…
“I don’t think that, unfortunately, they’re anywhere close to a constitutional plan.”
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* From the twitters…
At this point, I suppose, he has no other choice. But, man, this isn’t going to be an easy Democratic primary for him while he’s locking arms with a hugely unpopular (among city Democrats) Republican governor.
* Meanwhile…
Today, Jason Gonzales, candidate for state representative against Speaker Madigan, has announced the first of his endorsements. First is Dick Simpson, former Alderman and Chair of Political Science at the University of Illinois-Chicago. The second is Democracy for America, it’s Southside chapter.
In his endorsement letter Dick Simpson remarked, “I’m endorsing Jason Gonzales for State Representative of the 22nd District because he has the education and experience to start leading our state back in the right direction. I know he will work tirelessly on behalf of the people of the 22nd District and the State of Illinois, and make the tough choices necessary to make sure that the best days of Illinois are still ahead, and that the pathways to opportunity will be here for future generations.”
Simpson’s full endorsement letter can be found here:
https://www.facebook.com/jasonforillinois/photos/a.1697480273798899.1073741828.16964610739008 19/1710838759129717/?type=3&theater
The endorsement from Democracy for America came after a Saturday forum that included elected officials, candidates, and campaign surrogates for campaigns for federal, state, county, and local offices. After the forum, the members of the group voted on the endorsements of the candidates, which led to Gonzales’ nearly unanimous endorsement.
“It’s an honor to have the endorsement of both Alderman Dick Simpson and DFA-Southside,” Gonzales said. “Dick has consistently been a tireless advocate for working families and political reform throughout Illinois. DFA-Southside is a group of passionate, instrumental political activists fighting for democratic values in our communities.”
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Question of the day
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* Press advisory…
Higher Education Coalition Kicks Off Statewide Push for State Funding
Group Unites to Urge Lawmakers, Governor to Solve Months-Long Funding Stalemate
* On January 4th, the Illinois Municipal League’s executive director Brad Cole sent his higher education ideas to the U of I’s government relations office. I’m told the proposals received a “mixed” response. The IML got involved because the universities want to work with mayors of college towns…
Here are my suggestions for moving forward on the higher education funding issue. What seems to be lacking is any kind of plan that everyone can get behind, and without that there will probably be no movement by the General Assembly or Governor. I think everyone needs to agree to a few points and then present a focused effort. Thanks for coordinating this group, we’re looking forward to hosting the meeting tomorrow. This is what I would do (which doesn’t mean they are necessarily good ideas):
1. Ask for a six month appropriation to be passed immediately in January based on the same levels as what was passed and vetoed last year, I think that included a 6.5% overall reduction. As part of that, though, ask for a six month extension on the lapse period spending authority (through 12/2016). This would give schools half the budget now (since it is halfway through the fiscal year) and if something isn’t worked out on-time in the upcoming budget they would have more flexibility in holding it over into the fall. The chance of getting a full twelve month budget at this point seems very slim, and the fact that schools have managed thus far doesn’t help them in saying they need the full appropriation. It also shows a willingness by the schools to take a massive cut and move on. This could be coordinated by campus presidents/board leaders to make the ask officially.
2. Ask for the full fiscal year funding of MAP. By default this would mean some money to offset the lost appropriation, as it would bring in money that was floated for students enrolled in fall 2015. Then bring in a thousand students, whether they all get MAP or not, and let the story be about students… since that’s what each school should be about, anyway. I would do this a few days before either the State of the State Address or the Budget Address, but not too close prior or immediately after either. Put the story in the news about three days before the Governor gives his speech and make him and the legislative leaders react or account for it in all of their remarks. Timing is important and having the capitol under siege by students is critical; one bus load of students from every university campus and community college would be overwhelming. The local chambers of commerce could pay for the buses and the student government associations can coordinate from each campus; give everyone a t-shirt or hat or sign or something and set them loose in the capitol with the name and office location of their home district legislators… the organized chaos would be quite interesting and better than any AFSCME rally (and they know how to rally).
3. Find a judge/court in a county seat that houses a public university, probably downstate or in St. Clair County where the other suit was filed, and file a motion to consider all public university employees in the same class as all other state employees that are getting paid without a state budget. Public university employees are state employees (with state sponsored health care, retirement, etc) and the courts have already ruled on this issue, but the rulings didn’t specifically include university employees. I realize this won’t help the private schools or community colleges, but it will help the public universities. I would throw-in an extra motion that seeks repayment of employee salaries that were paid during the first six months of the fiscal year, as reimbursement, which would obviously further strengthen the cash flow for those schools that are hurting most. Maybe there is a bigger reason why the universities were left out of the original suit so this may not work, or maybe it was not seeing the forest for the trees; I don’t know, but it seems worth a try. The employee unions could take the lead on this like they did in the original employee payroll suit last July. I have a marked-up copy of the Fifth District Appellate ruling that I will give you for more information.
4. Have each college and university put money toward a major statewide public relations campaign that would promote the value of higher education, tie it to the brain drain and population out-migration hitting Illinois, show how the local economies are impacted, and tell the story of students who might not get their diplomas because of the lingering impasse. If every school, through their private foundation funds and not with state funds obviously, would contribute $20,000 or $50,000 or $100,000, there would easily be a couple million dollars to launch a comprehensive and immediate press/media campaign throughout the state and in targeted legislative districts to get attention on this issue. Radio, television, print and social media advertisements bombarding the issue would be impressive. That amount of money to contribute to this effort is minimal considering the tens- and hundreds of millions of dollars the campuses are losing. Have everyone contribute, pick a major firm to handle it, and then let them go (without a university-style committee to slow it down forever) and get it done. A lot of this should be focused on the FY17 budget process.
5. Key to any future (FY17) appropriation is making an offer of what schools are willing to do without. If a reasonable plan was submitted to the Governor and General Assembly, and reasonable in the sense of the overall state budget problems not just keeping the status quo for the campuses, there would be more of a chance of getting something agreed to by the leaders. There are lots of suggestions I could make, which I will save for another conversation, but asking for a multi-year budget appropriation or anything that doesn’t resemble a significant cut to really transform the funding levels is likely a non-starter. Unless the higher education community goes on offense with a plan, they will be on defense and other plans will be made without them.
I’ve been surprised at the lack of involvement by the U of I’s alumni group. The school has fired up that much-feared (at the Statehouse) group several times to stop what it considered to be harmful legislation. But where are the alumni now?
Anyway…
* The Question: Which of Brad’s 5 suggestions is the best? Take the poll and then explain your answer in comments, please.
free polls
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Your weekly Oscar the Puppy post
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* My former intern Barton Lorimor came over to the house yesterday with his cute daughter Robin…
Oscar loves him some Barton, and after a slow start, Robin fell in love with Oscar, too (he can sometimes be a bit too rambunctious for little kids).
Barton said he needed to get home to make dinner, but my mom and dad, my daughter and her family and some other great friends of ours were all coming over so I said he ought to just invite his wife to my place and we’d have dinner together.
He stayed and we all had a great time, particularly Oscar, who basked in all the attention.
* Mom and Dad left today, though, and Oscar spent some time by the front door. I think he was hoping for more visitors…
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* Press release…
To combat challenges created by uncertain economic conditions, Chicagoland small businesses plan to expand business operations in 2016 to continue revenue growth.
The results of the second annual Chicagoland Small Business Economic Outlook Survey, conducted by the Chicagoland Chamber of Commerce in partnership with Loyola University Chicago’s Quinlan School of Business, reveal that local business owners are realistic about the current state of business. Business owners have lost confidence in the local, state and national economies over the past year, and revenue growth remains their top concern.
“Only 28 percent of business owners surveyed believe Chicagoland’s economy will strengthen over the next year, down from 42 percent last year,” said Katie Fitzpatrick, Executive Director of Programs at the Chicagoland Chamber of Commerce. “These survey results show us that in order to combat current economic conditions and restrictive public policies, business owners are forced to be realistic and find new ways to expand their business operations.”
Key takeaways from the 2016 Chicagoland Small Business Outlook Survey:
· Small businesses are significantly less confident than last year in the economy at the local, state and national levels
· More than three in four respondents plan to grow their business [in the coming year]
· 38 percent expect to hire additional workers
· 52 percent plan to expand within Illinois (up from 45 percent last year)
· Nearly one half of respondents feel negatively impacted by local taxation
· The top three areas small businesses need support are marketing, technology and business planning
“Revenue growth remains a top concern for small businesses,” said Dr. Alexander Krasnikov, assistant professor, Loyola University Chicago’s Quinlan School of Business. “These businesses are increasingly self-reliant, looking to grow through investment in things like marketing and tech platforms, hiring part-time employees, and taking on more clients.”
Given the vital role small businesses play in creating jobs and anchoring communities, this study will be used to better understand the needs and expectations of local small businesses and entrepreneurs and help shape Chamber programs and policies to best suit the needs of small businesses in Chicagoland.
“Small businesses are the heart of Chicago’s neighborhood economy and we must continue providing them with resources they need to thrive,” said Kurt Summers, Treasurer of the City of Chicago. “I am pleased to see the results that highlight over 50 percent of small business owners surveyed are planning on expanding in Illinois in 2016. The Treasurer’s Office is committed to providing new and innovative ways to help small business owners access capital in order to grow and expand in Our Chicago.”
The 2016 Chicagoland Small Business Outlook Survey was conducted electronically in October and November of 2015, with 574 small businesses participating. Several partners contributed to the survey, including the Better Business Bureau, Constant Contact, Blue Daring the Office of the City Treasurer.
Click here for more results.
Thoughts?
* Related…
* The 10 most in-demand Chicago jobs in 2016 (that pay $60,000 plus)
* Minority business numbers growing by double digits
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Jim Edgar’s not so hidden agenda
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* As the Illinois Review rightly notes, this op-ed by former Republican Gov. Jim Edgar appears to be more about the never-mentioned Bruce Rauner than it is about Congressman Rodney Davis…
When faced with the choice to fund the government or face another government shutdown, he voted for progress. It was the responsible vote to cast. The economic losses from a government shutdown would have been astronomical. Continuing dysfunctional government in Washington is not governing and it is not leadership. Unfortunately, some in politics allow the perfect to become the enemy of the good.
In my experience, you don’t always get everything you want. But it is important to keep making progress and stay focused on solving problems. Davis voted to lead, to govern and to make progress. He did the right thing.
Governing is challenging. Negotiating with divided branches is difficult and success comes slowly. When I was governor, for all but two years, we had a divided government and I often faced situations where I didn’t always get the reform I wanted. But even in divided government, we were able to work together to eliminate a massive backlog of state bill payments, build historic state budget surpluses and reduce the size of government.
We made progress together because we were disciplined, kept lines of communication open between the divided branches of government and recognized the need to compromise for the good of the people. […]
In this time of polarizing politics, our country needs to make progress. I appreciate true leaders who will make the tough decisions to strengthen America and tackle problems. And I count Rodney Davis as one of them.
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* Pearson…
Democratic U.S. Sen. Dick Durbin has endorsed Highland Park Mayor Nancy Rotering over former U.S. Rep. Brad Schneider in the race for the Democratic nomination in the North Shore 10th Congressional District.
“Nancy combines fiscal responsibility with true progressive values,” Durbin said in a statement.
Rotering called Durbin a “role model” and “the epitome of a public servant for over 30 years.”
Durbin’s endorsement, while significant, also shows the split among the Democratic establishment over the race. While he backs Rotering, Schneider has the backing of top House Democratic leadership, including Rep. Nancy Pelosi.
* From the Durbin press release…
“Nancy brings to this race an extraordinary record for a first-time Congressional candidate. As Mayor of Highland Park she successfully confronted ComEd when local families were suffering from unreliable service, balanced the City budget five consecutive years and enacted real reforms,” stated Durbin. “Her most noteworthy achievement gained national attention when she passed one of the nation’s first local assault weapons ban and successfully defended the ordinance against an onslaught of gun lobby attacks all the way to the U.S. Supreme Court. While the Republican-led Congress refused to respond to the nation’s gun violence, Nancy Rotering and her City of Highland Park showed real leadership. Nancy combines fiscal responsibility with true progressive values.“
* From the Pelosi release…
“Brad Schneider is a relentless defender of women’s rights and LGBT equality. His legislative vision is a direct reflection of his genuine passion for helping others. We need strong progressive voices like Brad’s in Congress. That’s why I’m proud to endorse his candidacy,” said Democratic Leader Nancy Pelosi.
“I am humbled to receive the endorsement of Leader Pelosi,” said Schneider. “I’m looking forward to returning to Congress to work with Leader Pelosi on the critical issues facing Americans.”
Campaign Manager Magen Ryan said, “Our campaign is in a better spot than ever less than 60 days from the election. This week Brad received the unanimous endorsement of the AFL-CIO following the recent endorsements of SEIU Illinois State Council, the Lake County Federation of Teachers, and many other unions throughout the Tenth District. The support of labor along with seven members of the Illinois Congressional Delegation, including Tammy Duckworth, more than 60 other of Brad’s former colleagues in Congress, the Democratic Congressional Campaign Committee, Secretary of State Jesse White, Cook County Board President Toni Preckwinkle, and more than 30 other local elected officials demonstrates the breadth and depth of the support of his candidacy.”
*** UPDATE 1 *** Rotering is now airing her first TV ad of the primary. Click here.
*** UPDATE 2 *** From our pals at Comcast…
Nancy Rotering for Congress
Democratic Candidate for US Congress in IL CD 10
Agency: Dudley Media, Philadelphia
Total Buy: $122,892
1/19/16 - 2/8/16
Networks: AEN, BRVO, CNN, DISC, ENT, ESPN, FAM, FOOD, FX, FXNC, GOLF, HALL, HGTV, HIST, LIF, MNBC, TBSC, TNT, TWC, USA
Dayparts: 5-9A, 9A-4P, 4P-7P, 7P-midnight, Sa-Su 11A-7P
Syscodes / Systems / $ by system
1863 / Libertyville / $36,528
5126 / Highland Park / $41,418
5553 / Gurnee / $44,946
Total Buy: $122,892
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Crime and (no) punishment
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* Tribune…
[Cook County State’s Attorney Anita Alvarez] defended her record on police prosecutions. “Any officer who commits a crime should be held accountable,” Alvarez said to a smattering of boos. “I’ve been doing it, I will continue to do it and there’s no need for a special prosecutor.” Alvarez and More opposed special prosecutor appointment while Foxx welcomed it.
* BGA…
By her own admission, Chicago Police Officer Allyson Bogdalek was “untruthful” during a 2011 court hearing for Ranceallen Hankerson, who was charged with armed robbery and attempted murder in connection with a violent liquor store stick-up on the South Side a year earlier.
While under oath on the stand, Bogdalek told the courtroom she hadn’t shown the liquor store owner – who was shot in the leg during the 2010 robbery – a photo spread with Hankerson’s picture prior to his arrest.
In reality, she had shown the owner Hankerson’s photo, but the victim initially failed to identify Hankerson as the assailant – a critical piece of information for Hankerson’s defense, according to court records and interviews.
In 2012, following a series of court hearings but before Hankerson’s actual trial, Bogdalek came clean about what happened – after Hankerson’s defense attorney got a hold of Bogdalek’s squad-car video from the day Hankerson was arrested. The video captured a cell phone conversation between her and a supervisor in which she mentioned showing lineup photos to the liquor store owner shortly after the stick-up.
Hankerson’s criminal case was quickly dropped by Cook County State’s Attorney Anita Alvarez’s office because of Bogdalek’s conduct, according to interviews and court records […]
But more than three years later, Bogdalek is still on the job, and it recently came to light that Alvarez ignored a recommendation from an underling to hit Bogdalek and her partner with perjury-related charges – raising further complaints that Alvarez too often looks the other way when it comes to alleged police misconduct, particularly within the Chicago Police Department.
Sheesh.
* Related…
* State lawmakers push wave of police measures in wake of Laquan McDonald case
* Church-Based Activist Group Calls For Creating Chicago Police Auditor To Enforce Reforms
* Every Chicago cop would get a Taser under black ald. plan
* UN delegates to visit Chicago to investigate city’s race relations
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Inaction has consequences
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* All this and much, much more, over $510 million a year in projected revenues…
The budget impasse in Illinois is beginning to depress enrollments at the state’s colleges and universities, as state money earmarked for low-income students remains tied up in a political stalemate that shows no signs of easing.
More than 1,000 students failed to return for the second semester as their schools stopped picking up the tab for the $373 million Monetary Award Program, said Randy Dunn, president of the Southern Illinois University system.
The program normally provides grants of up to nearly $5,000 to some 128,000 students with mean family incomes of about $30,000, said Lynne Baker, spokeswoman for the Illinois Student Assistance Commission, which administers the program. But with no state budget in place since summer, the program’s funding has stopped. […]
The problem is poised to grow quickly as schools wait for their share of about $1 billion in state funding.
* And…
Disabled Illinois residents who depend on in-home help for daily needs will suffer once the state stops paying overtime for their caregivers beginning March 1, some home health care workers and their union say.
Tens of thousands of employees who help people with disabilities live independently are eligible for time-and-a-half pay over 40 hours in a week, under a federal rule that took effect Jan. 1. But without a state budget in place to control spending, Gov. Bruce Rauner’s administration says it can’t afford the extra pay.
A state Department of Human Services memo obtained by The Associated Press indicates the policy will allow 35 hours of work and five hours of travel.
The workers, who make about $13 an hour, and their supporters say that 30,000 clients who need assistance because of physical or developmental disabilities will receive less-efficient and less-effective care because most need more than 40 hours of weekly assistance. Families will have to find other aides to help, meaning disruption, and for some clients, discomfort with a new person.
* Related…
* Illinois budget situation forcing seniors to lose assistance programs
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Gov. 1.4 Percent
Tuesday, Jan 19, 2016 - Posted by Rich Miller
* My weekly syndicated newspaper column…
A lot of folks have taken to calling Bruce Rauner “Governor 1 Percent” because of his immense personal wealth. Gov. Rauner himself told the Chicago Sun-Times during the 2014 campaign that he was in the top one-tenth of one percent of income earners.
But, right now, anyway, he ought to be referred to as “Governor 1.4 percent.”
Why? Stay with me a bit and I’ll explain.
I sat down for an interview last week with Gov. Rauner. As with just about every reporter, Rauner blamed House Speaker Michael Madigan for stifling his beloved Turnaround Agenda. The governor said he was “frustrated” with Madigan for saying that his anti-union, pro-business reforms were “unrelated to the budget.”
“For example,” Rauner said, “if we can get business regulatory change so I can recruit manufacturers here and more transportation companies here, and more businesses here, we can generate billions of new revenue without raising tax rates. That’s directly tied to the budget.”
“Billions?” I asked.
“Billions,” he replied, while promising to send me a detailed analysis.
A few days later, his staff e-mailed me a memo that the governor had sent to lawmakers last fall. You can see it yourself at CapitolFax.com/turnaround.
But the memo didn’t really say much of anything about revenues, other than if the governor could get Illinois to “average” levels of unemployment and Gross State Product and if the governor could stop the migration of Illinoisans to other states, his agenda would produce a grand total of $510 million in additional revenues.
That ain’t “billions.”
And while $510 million is nothing to sneeze at, it won’t even cover the interest on the state’s mountain of overdue bills that have been accruing because the state has no budget and no way to pay them.
Of course, the state has not had a budget since June and has no way to pay those overdue bills because the governor refuses to negotiate a new budget until he gets his Turnaround Agenda passed, which according to his own memo wouldn’t produce enough revenue to pay the juice on money owed to the state’s vendors — not to mention the universities which haven’t received any state funding, creating major crises at several of them, and all the other social service groups which make up our safety net being stiffed, forcing the state’s most vulnerable to go without.
And while $510 million seems like a lot of money, the governor’s projected revenue growth from his Turnaround Agenda would only be a 1.4 percent increase over the last state fiscal year.
Hence, “Gov. 1.4 percent.”
And would it even be that much? Rauner has said he would agree to higher state taxes if legislators agree to his Turnaround Agenda. But as a Republican legislative friend pointed out to me last week, that tax hike will reduce growth, even with all of Rauner’s agenda items.
“The point is that they can’t argue that these anti-labor changes will magically produce $510 million of economic growth/revenue and then discount the negative effect of a tax increase on economic growth,” he wrote me.
True.
OK, but maybe the governor was just a little confused and meant to include state governmental savings in that “billions” remark.
So, let’s go back to the memo.
The governor claims the state would save $1.75 billion by making his demanded changes to union collective bargaining laws. $750 million of that would come from cutting healthcare costs for state employees. The rest isn’t explained.
He also claims that workers’ comp reforms would save the state $65 million a year. So, we’re looking at about $1.8 billion in savings. That’s far more substantial, but so far he’s getting absolutely nowhere because he’s taken such a hardline stance against unions.
To be fair, Rauner’s memo also claims that local governments would save billions more with his reforms, but some of his numbers just don’t add up, like overstating the savings on allowing governments to opt out of prevailing wage requirements on nonfederal projects.
I’m not all opposed to doing some pro-business reforms. I think an easy case can be made that workers’ comp costs are far too high, for example.
But I spent part of an afternoon last week listening to an otherwise tough-minded woman cry helplessly on the phone about the literal implosion of the state’s social service safety net.
And one of the greatest charitable groups in the history of this state, Lutheran Social Services of Illinois, is facing an existential crisis because the government owes it $6 million.
In my opinion, the payoff for continuing this governmental impasse is not worth the price being paid.
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