* The Illinois Policy Institute has a new budget plan. I’m still going through it, but it wants a five-year property tax freeze while also taking away billions from local governments and schools…
» Revenue-sharing agreements that fuel excessive local spending, such as the Local Government Distributive Fund – for counties and cities with populations above 5,000 – and the Downstate Transit Fund. (Savings: $1.75 billion)
» State pension subsidies that allow districts and universities to dole out higher pay, end-of-career salary hikes and pensionable perks. Going forward, local school districts and universities should be responsible for paying the annual (normal) cost of pensions. (Savings: higher education: $450 million; K-12: $970 million)
» Special carve-outs in the state’s education funding formula that grant subsidies to a select few school districts affected by local property tax caps and special economic zones. (Savings: $250 million)
So, whack the LDF, transfer pension costs to schools and universities and cut Chicago’s school funding.
* But it does give locals this…
Reform costly state mandates imposed on local governments such as prevailing wage requirements and collective bargaining rules. Ease the process for government consolidation and other cost-saving measures. (Local government savings: $2 billion-$3 billion)
* It also wants a 10 percent reduction in the number of state employees and implementation of Gov. Rauner’s contract terms, for a claimed savings of $500 million for each point.
The group wants to cut higher education spending by $500 million a year. It would cut Medicaid spending by $415 million.
* Its pension proposal looks like it revamps the ramp…
» Phases in the costs of any pension funds’ actuarial changes over a five-year period. This will reduce the required $800 million increase in state contributions by nearly $650 million in 2018.
» Creates a new contribution schedule with a 2018 payment that is $1 billion less than baseline contributions. That will protect overburdened Illinoisans from
tax hikes and allow the state to prioritize funding for social services.
* Its chart…