Obama won’t free Blagojevich
Thursday, Jan 19, 2017 - Posted by Rich Miller
* No surprise here…
President Barack Obama made his final grants of clemency on Thursday with less than a day left in office and imprisoned former Illinois Gov. Rod Blagojevich was not on the list.
Blagojevich was handed a 14-year sentence on corruption charges, with one of the most sensational his attempt to “sell” the Illinois Senate seat then-Illinois Sen. Barack Obama was vacating after being elected president in November 2008.
The Justice Department earlier confirmed that Blagojevich, in year four of his imprisonment, filed a request to have his sentence commuted. He was arrested in December 2008, a few weeks after the presidential election.
Blagojevich’s bid for clemency from Obama was always extremely unlikely because of the nature of his offense. […]
Obama cut short the sentences of 330 federal inmates convicted of drug crimes on Thursday, with Obama focused on cutting the prison time of offenders with overly harsh sentences that would not be imposed under guidelines for judges in place today.
Some people insisted for years that Obama had some sort of special relationship with Blagojevich which would lead to a pardon. They were living in a fantasy land.
…Adding… Pool report forwarded by the White House press office…
A travel/photo lid has been called at 4:10 p.m. […]
And with that, Barack Obama’s final full day as president has come to an unofficial close.
-30-
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Illinois now exporting rat disease
Thursday, Jan 19, 2017 - Posted by Rich Miller
* From the BN-D…
State regulators say half a dozen people have developed a virus linked to rats at two Illinois rat farms.
The Illinois Department of Public Health reporting Thursday that there have been six confirmed cases of Seoul virus in individuals who had direct exposure to rats in two different Illinois ratteries, including one in east-central Illinois. Ratteries are facilities where rats are bred.
A rattery in Wisconsin purchased rats from the two Illinois ratteries, and two Wisconsin residents have also tested positive for Seoul virus. Results of laboratory testing of rats at these facilities are pending.
The agency said it is working closely with the Wisconsin Department of Health Services, the Centers for Disease Control and Prevention, and local health departments to investigate the source of the Seoul virus infections, coordinate testing, and prevent possible future cases.
Learn something new every day. I’d never heard of a rattery before, and I didn’t know the state has two of them.
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* Tribune…
Illinois politics saw a watershed year for cash on legislative campaigns in 2016, with newly released financial reports documenting Republican Gov. Bruce Rauner’s lead role in funding GOP candidates and Democrats under House Speaker Michael Madigan relying on union and labor allies to keep General Assembly majorities. […]
All told, the House Republican Organization raised and spent about $30 million on individual campaigns, eroding Madigan’s 71-member, veto-proof majority to a 67-51 edge. Madigan, who was attacked by Republicans as a symbol of what is wrong in Springfield, fought back with about $15.5 million in spending from four political funds he controls.
The Republican State Senate Campaign Committee, focused on fewer contests, spent nearly $8 million and picked up two GOP seats to reduce Senate President John Cullerton’s majority from 39 members to 37 against 22 Republicans — still a veto-proof margin.
On the Senate side, three political funds controlled by Cullerton cycled through $14.5 million in spending. The campaign arm of Senate Democrats spent $9.7 million, with about $5 million coming from two other Cullerton funds.
Those House numbers looked a bit off to me, so I asked Team Rauner if they had compiled anything.
* From Mike Schrimpf…
We took a look at the Tribune story and did our own analysis based on competitive races. Because of Illinois’ unique state campaign finance system and the different strategies used by both parties to fund campaigns, we believe you need to expand what you are looking at to get a complete picture of campaign spending.
As we’ve detailed previously, the Democrats use a number of incumbents as “piggy banks” to transfer significant funds between campaigns while Republicans largely do not. Therefore, we believe the most accurate way to analyze campaign spending is to isolate and exclude transfers out by party and candidate committees (since that money will also be counted in a candidates’ finance report) and then sum the remaining spending by candidate committees and other political committees and outside groups.
Doing that shows total spending by all sides on the general election campaigns were at parity. Please take a look at the attached for a more detailed breakdown.
Click here for his complete analysis.
* Schrimpf pegged total Democratic spending at $50,215,528.21 and total Republican spending at $50,985,565.04.
According to Schrimpf’s analysis, House Democratic candidates outspent House Republicans $19.5 million to $15.7 million. Again, click here because Schrimpfy has all the numbers down to the penny.
Schrimpf says Senate Democrats also outspent SGOP candidates $10.4 million to $5.9 million.
Party spending is where the Republicans had the big advantage, at $22.3 million (mainly Rauner money), versus $7 million by the Democrats. And that helped even the score on the local level.
But the Democrats had an advantage in outside spending (almost $10 million of that by Sen. Daniel Biss’ PAC) with $13 million, versus $7 million by the Republicans (much of that by Dan Proft’s PAC, but $2 million by a Rauner committee).
One big caveat on that last batch of numbers. Biss’ PAC did a statewide buy, so I don’t know if it should be included. But, whatevs. He spent it, let’s tally it.
* The other thing to ponder is that Madigan, Cullerton and others worked very hard to raise about $40 million last year, and Madigan’s and Cullerton’s allies helped boost Biss’ LIFT PAC. They’re gonna have to do that all over again for 2018, which is why some top Democrats want a self-funder candidate for governor.
They were stretched to the very limit last year, but still managed to keep up. If they also have to fund a gubernatorial candidate next year, they may not be able to keep up again.
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* I’ve lost track of the number of developers who’ve promised to erect the tallest building in Chicago over the years, including, if memory serves, Donald Trump.
Aside from that, selling the Thompson Center and developing the property makes some sense to me. Downtown is full of construction cranes, so the market is hot and property like this doesn’t come around very often…
The state legislature’s GOP leaders, Sen. Christine Radogno and Rep. Jim Durkin, are once again introducing legislation that would allow the state to sell the 16-story, 1.2 million-square-foot structure and move state workers to leased space in other buildings, Durkin said.
This time around, the state’s Department of Central Management Services is providing specific estimates of how much a sale of the Thompson Center would boost the state’s finances. A sale would generate potential net proceeds of $220 million and would prevent the state from addressing $326 million in deferred maintenance on the building, according to CMS. […]
One rendering shows a 115-story, 1,700-foot-tall tower that would be the city’s tallest, topping the 1,451-foot Willis Tower. The tower would include offices, retail, residential units, a hotel and an observation deck. A second plan would have buildings of 40, 60 and 70 stories with mixed uses. […]
The estimated cost to repair the Thompson Center is more than triple the $100 million in deferred maintenance that Rauner first cited in 2015. Commercial real estate experts also say the state would be hard-pressed to get even half of its estimated $220 million net proceeds in a sale, since a buyer would still face extensive demolition costs just to clear the site and start a new development.
Putting the property into private hands would also generate a bunch of property tax revenue for the city.
*** UPDATE *** From Ald. Brendan Reilly, whose 42nd Ward includes the Thompson Center…
I stand ready to meet with the Administration to discuss zoning limitations & redevelopment parameters for the property before they market it for auction. Potential buyers will want a general sense of what can and cannot be done on that site before they would bid on the property at auction.
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Question of the day
Thursday, Jan 19, 2017 - Posted by Rich Miller
* Many of us in this business knew Barack Obama from his days in Springfield. So, for those of you who did know him (or still do), what’s your favorite Obama story?
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Some economic development food for thought
Thursday, Jan 19, 2017 - Posted by Rich Miller
* James Krohe Jr….
Back in 2009, urbanist Aaron Renn wrote about new kinds of economic development that don’t involve things that move on trucks. Pointing to New York City, he noted that there are good reasons why the deal-makers of the big banks and investment houses have to be in Manhattan. However, their back-office operations, where is done the essentially clerical work that cleans up the mess made by traders every day, don’t have to be there. That work can be outsourced to lower-cost cities that also offer workers affordable housing and better quality of life. And that’s what the finance industry has done, sending jobs to Florida, North Carolina, Delaware and the like.
Several kinds of work lend themselves to this separation of functions. One of them is the law. By “offshoring” prep work for big cases to branches in places outside the Loop, Renn argues, the big Chicago firms could tap a pool of lower-cost lawyers. “Chicago,” he wrote, “might be the only elite city in the country where you can get access to a far lower cost point just by going beyond the immediate metro area.”
Renn argues for Milwaukee and Indianapolis as bases for such operations, but might similar possibilities exist for Springfield lower on the food chain? The city has a white-collar workforce, many of whom at the moment haven’t much to do. It also offers some lifestyle advantages to young lawyers. including a quick drive home to a relatively cheap house. That would seem to make it a good place to open what amounts to legal back-office operations, linked with the state’s economic engine via genuinely high-speed public transportation and super-fast broadband. Springfield would have a bright future as, not a branch office, but a branch city.
Thoughts?
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* AFSCME Council 31…
January 19, 2017
John Terranova
Deputy Director, Labor Relations
Illinois Dept. of Central Management Services
Room 501, Stratton Office Building
Springfield, IL 62706
Dear Mr. Terranova:
AFSCME and the State of Illinois have a long history of collective bargaining going back more than 40 years, spanning the terms of seven different governors. Although the parties have not infrequently had serious disagreements with one another, both parties have historically understood the need to conduct themselves with integrity. Employer representatives therefore have had a high degree of credibility with employees and with the Union. Unfortunately, that is no longer the case.
State employees have now learned that, as a general rule, when their employer makes a statement, it is more than likely false. Your most recent missive (1/13/17) is but another shameful example.
You told employees that the Labor Board “approved” the governor’s “reasonable proposals.” There is nothing in the Board’s decision that approved the proposals or found them reasonable. Your statement is blatantly false.
You claimed that in the new framework our union put forth employees would not really forego a wage increase for four years, while your boss called that painful decision “superficial.” The Union was very clear that the framework provided for no “base wage increase,” and that it provided for step increases in only the last two years for those 40% of employees who have not yet reached the full rate of pay for their classification. Surely you are familiar enough with the collective bargaining agreement to understand the distinction between “steps” and “base wages”.
You implied that there is something wrong with letting the judicial system determine whether or not Governor Rauner broke the law by unilaterally deciding to deny employees step increases after the expiration date of the contract. As you are fully aware, the union did not include steps for the first two years of the contract as part of the settlement framework. If the courts determine that the governor did not break the law, then the he has nothing to worry about. If the courts determine that he did break the law, then the courts will also decide on the remedy for that violation. Again, the framework does not propose that the state agree to pay steps in the first two years.
You belittle the offer to pay an additional 8.5% in health insurance premiums, plus increased out of pocket costs, while going four years with no base wage increase. That may seem “tiny” to someone like your boss who makes 188 million dollars in one year, but it is not “tiny” for the average state employee.
You make the outrageous and patently false claim that AFSCME refuses to compromise even though the Union has been telling you for a year now that we have new proposals that provide for further compromise on our part. It is the governor who has refused to allow you to meet with our bargaining committee to receive and discuss those new proposals, thus foreclosing any opportunities for further compromise.
You continue to falsely claim that other unions have agreed to offers similar to the one the governor is seeking to impose on AFSCME members even though the truth is that those unions have not agreed to forego wage increases for four years and also to pay significantly more for insurance.
You attempt to mislead employees by saying that the Administration will offer them health insurance plans with the same or lower premiums while failing to say that all of those plans could cost the average employee thousands of dollars more in out of pocket costs. And you do this even though you know that all of the plans the Administration wants to impose on employees would require the same shift in costs from the State onto the employees. Either way, the average employee would have to lose $10,000 over the term of the contract.
You try to frighten employees by suggesting that a strike could be illegal because the Tolling Agreement might still be in effect, even as you continue to assert in court that it is not in effect.
Fortunately, the union has top flight attorneys, so state employees do not have to rely on your distortions and scare tactics. If the Tolling Agreement is in effect, then the governor cannot impose his terms on employees. If it is not in effect, then employees have the right to strike. There is no valid legal argument that the governor can impose with impunity, while employees have no right to resist. If there is a strike, it will be a lawful one, and employees’ legal right to strike will be protected.
You go to great lengths to describe the cost of a strike that would last a month. I don’t know how you came up with a month, nor do I know how you arrived at the figure you presented, but we do not believe it is accurate. Moreover, there is still ample opportunity for the Administration to avoid a strike by returning to the bargaining table.
You suggest that if there is a strike, the state will somehow be able to maintain services by hiring strikebreakers. The idea that the Administration could readily replace 28,000 skilled, knowledgeable, and dedicated employees is demonstrative of this administration’s lack of respect for the work that state employees do.
Finally, I urge you to immediately cease and desist from using the state’s email system to spread your falsehoods and fear-mongering.
I will close by reiterating that our union is doing everything possible to avert a strike and reach a fair contract settlement. If the Rauner Administration has any genuine interest in those goals, you can return to the bargaining table and work constructively with us to find common ground.
Sincerely,
Mike Newman
Deputy Director
* Related…
* AFSCME strike vote is an insult to middle-class Illinoisans
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* After dodging questions Tuesday about where he stands on “repeal and replace” of Obamacare, Gov. Rauner talked a tiny bit more yesterday…
Illinois Gov. Bruce Rauner says President Barack Obama’s health care law has “massive flaws,” but he’s cautious about repeal “with nothing to replace it.”
Rauner spoke to reporters Wednesday after an event in Springfield. The Republican says he’s encouraging Illinois officials to talk with President-elect Donald Trump’s team and “encourage them to be thoughtful about it.”
* More…
“I don’t think it works very well to just take it away and have nothing to replace it with,” he said. “I don’t think that works.”
He also spoke out against changing Medicaid into a block-grant program, something supported by U.S. House Speaker Paul Ryan and Health Secretary nominee Tom Price.
“Illinois is not well-positioned if they do that,” he said. “Illinois has been mismanaged on its Medicaid program for years. We’re trying to fix it but we’ve only been at it for two years and it takes a while.”
Discuss.
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Progress?
Thursday, Jan 19, 2017 - Posted by Rich Miller
* From the Illinois Policy Institute’s Facebook page…
A new bill in the Illinois Senate is taking aim at soda drinkers.
The Sugar-Sweetened Beverage Tax Act, introduced by State Senator Toi Hutchinson, would place a penny-per-ounce tax on bottled sugar-sweetened beverages, syrups or powders. The new tax would supposedly raise an estimated $560 million annually for Illinois.
But the law would raise this money on the backs of poor Illinoisans.
Like sales taxes, a tax on soda is regressive. It would place a larger share of the tax burden on residents least capable of paying it. On top of that, many residents from Hutchinson’s district would be hit the hardest.
So, that means the “Institute” now wants progressive taxes?
Cool.
Maybe they’ll help pass petitions to put a progressive income tax on the ballot.
* Related…
* A new tax on sodas, sugary drinks? It might be part of Illinois budget deal
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* Announced Democratic gubernatorial candidate Chicago Ald. Ameya Pawar was in the Quad Cities this week…
Pawar says he believes in a graduated income tax rate for the wealthy to pay their fair share.
He’s also campaigning on providing universal daycare, increasing funding to local schools and equitable funding that makes districts less reliant on property taxes. […]
“I also want to run on a vision,” Pawar said. “And, what I’m trying to present to people is to say we need a new deal for Illinois. Enough of this shaking up Springfield and cutting benefits and wages, we need a deal, a new deal for all Illinoisans that helps them get a fair shake of the middle class and the American dream.”
* And…
He said government, whether local, state or national, is getting a bad name from those claiming and repeating “that everything government does is broken or evil or corrupt.” However, he said, government “created the largest middle class we’ve ever seen after the Great Depression,” citing the New Deal, Civil Rights Act and Great Society programs.
“So I think government can be a force for good,” he said on a visit to the Quad-Cities on Wednesday to attend a Democratic Party rally. “And that means you have to elect people who believe in government and not people who want to run government like a business. So I think that means going out and talking to people and changing the narrative. […]
He also favors universal day care and criminal justice reforms.
“It doesn’t matter where you go in Illinois, it’s poor people being incarcerated for substance abuse and mental health issues,” Ald. Pawar said. “That’s got to change.”
That comment about government creating the middle class could get him in some trouble, but he is, after all, the leftie in the race.
* I was interested, however, in his response to a question about where he stood on Speaker Madigan, which wasn’t reported but is in the raw video of a TV interview. He started out by repeating something he’s said many times: “I’ve only met him once, after I won in 2011.” The interviewer followed up by saying Madigan has a record as well…
“He has a record as well, but I think if you turn everyone into a bogeyman you can’t expect them to come to the table and work with you.
“I’ll put it in these terms, private sector terms, since that’s what the governor likes. What CEO of a company comes in and says ‘I can’t do my job because the operations manager won’t let me?’ You have to be able to work with people.
“He’s basically turned over the keys to the governor’s mansion and office to the Speaker and says ‘I can’t do anything, it’s all his fault.’ He ran for the job, but now he says he can’t do the job because of one person. That’s not how it works in any other level of government in any time in history.
“His goal is to reduce benefits and destroy collective bargaining rights. And the Speaker is standing in the way of that. Do I agree with the Speaker on everything? Absolutely not. I also don’t know him. But I’m also not going to sit and demonize someone who I might have to work with.
“That includes the Republican leaders. I don’t think Republicans are bad, they’re just a different party. But they’re people who care about their constituents.
“I just can’t say the same thing about Gov. Rauner in terms of whether he actually just cares about his wealthy friends and an agenda or whether he has a real goal in Illinois other than just creating constant chaos.”
He needs to tighten that up a lot, and drop the “operations manager” analogy because it doesn’t quite work. In the private sector, a CEO can just fire an operations manager.
Other than that, it’s not a bad way to deal with the “Madigan question” that every candidate at every level will get as 2018 nears.
* Related…
* Charlie Wheeler: Check The Facts Before Buying Into The King Madigan Storyline: However, even a rudimentary understanding of state government and a cursory online search of past Illinois leaders would disclose how Madigan’s supposed “running” of the state for 34 years — his “kingship” — is nonsense. For starters, while speaker is undeniably a powerful position in the House, the post has little to no sway in the other legislative chamber, the Senate. And, of course, whatever legislators decide to do, the governor has almost the final say with a range of veto powers. But wait, can’t the legislature override vetoes? Sure, but despite their veto-proof majorities on paper, Democrats overrode only two of more than 100 vetoes in Rauner’s first two years, one of them with his blessing.
* Austin Berg: Madigan makes history as Illinois bleeds: Madigan decides which bills receive a public hearing, who chairs committees and receives the $10,000 stipends that go with them, who votes in committees, and when bills are called before the full House. That’s not democracy. That’s a dictatorship.
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Today’s number: 50 years
Thursday, Jan 19, 2017 - Posted by Rich Miller
* From the Southern Illinoisan…
The three longtime lawmakers from Southern Illinois whose legislative jobs have officially ended represent more than 50 years of combined experience.
With the swearing in of the 100th General Assembly on Wednesday, the terms of Sens. Gary Forby and Dave Luechtefeld have officially come to a close. Rep. John Bradley’s legislative career ended Jan. 1 when he resigned a few days ahead of the scheduled end of his term.
Forby and Bradley, both Democrats, were defeated in November as a Republican wave swept across Southern Illinois. Luechtefeld, a Republican, chose not to run again after his home was drawn out of the district he represents in the decennial redistricting process.
The transition marks a substantial loss of clout and experience at one time for the Southern Illinois delegation under the dome, where seniority plays a role in everything from committee assignments to parking spots. […]
There also are returning members of the Southern Illinois delegation. Rep. Brandon Phelps, D-Harrisburg, has served since 2003, and now is the most senior member of those representing deep Southern Illinois. Rep. Jerry Costello II, D-Red Bud, has served since 2011. Rep. Terri Bryant, R-Murphysboro, has served since 2015.
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* Tribune…
At a later stop in Springfield, Rauner noted the importance of early childhood education and blasted the current state of child care.
“Too often in Illinois and around America, especially for lower-income communities, child care has no education component,” he said. “And in fact, good child care is regarded as ‘strap a child in a car seat and turn the TV on.’ That is institutionalized brain damage. To me, it should be criminal.”
Um, OK, so maybe now we know why he cut child care program funding?
And an upgrade like what he’s talking about will not be cheap. At all. We’ll need a bigger tax hike if he wants to actually do it.
*** UPDATE 1 *** Response from Faith Arnold, SEIU Healthcare Illinois executive board, vice chair, child care division…
“Bruce Rauner’s insensitive characterization of the state of child care in Illinois shows his gross disregard for providers and the children and working parents we serve. Our choice of profession reflects our commitment to children and families and is NOT a reflection of our education. And it certainly is not a reflection of our character. However, the governor’s insulting choice of words serves as a poor reflection on HIS.
“Rauner knows better than anyone that HIS cuts to service have caused incredible damage to the Child Care Assistance Program, which at one point was among the most successful in the nation. No more. As a result of his arbitrary administrative maneuvering, and his failure to reach a fair contract with the state’s child care providers, he has engaged in a full-scale dismantling of the program which has cost jobs, slowed economic growth and harmed Illinois families.
“But more than that, his regrettable use of language to insult people like me shows someone entirely disconnected from the working families he claims to serve. It’s no wonder we enter a new year without a budget and with little hope for true leadership or compromise from Bruce Rauner, who is resorting to bully language once again.”
*** UPDATE 2 *** From the governor’s office…
Hi, Rich:
The governor and First Lady have spent more time working to improve the lives of young children than almost any couple in America. And as Governor, he has successfully increased early childhood funding by $100 million. His comments were not attacking the hardworking men and women who care for children so parents can go to work, go to school, and allow kids to flourish – but he is concerned about cases where children are placed in front of a TV with few toys and even fewer books.
The governor wants to ensure that every child arrives in kindergarten developmentally prepared. His Children’s Cabinet is working to address this very issue, bringing together state agencies to improve state credentialing and licensing programs. It is disappointing that instead of joining in those efforts, SEIU is choosing to mischaracterize the Governor’s words and intentions.
Best,
ck
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* Subscribers were told about this development early today. AP…
Gov. Bruce Rauner’s office estimates a Senate proposal to break a nearly two-year Illinois budget deadlock would still leave the treasury billions of dollars in the red.
The review obtained Wednesday by The Associated Press shows tax increases floated in the Senate plan would increase revenue by $1.7 billion. But it says it adds more than $4 billion in spending. […]
But the budget office estimates the compromise Senate Democrats and Republicans put forth last week would only reduce the expected deficit by $1 billion [down to $4.3 billion]
As I told subscribers, after two years without a real budget nobody really cares about this fiscal year’s deficit as long as next fiscal year is balanced.
* The trouble is, GOMB’s analysis claims that next year’s proposal is out of whack, too…
The governor’s budget team says that $4.3 billion deficit for the current financial year would fall to $2 billion in the next one as money begins to roll in from the taxes proposed in the Senate’s budget framework, according to a copy the Chicago Tribune obtained.
The projected FY 18 deficit is actually $2.3 billion.
* More…
The math breaks down like this: Because of a series of court orders and laws that’s kept most of government spending on autopilot, the budget office estimates the state will spend $35.1 billion in the financial year that ends July 1. The analysis projects the Senate plan would bring in an extra $1.7 billion during that period, which would leave the state with $35.4 billion to spend. But the Senate plan calls for spending an additional $4.4 billion this year — including nearly $2 billion on employee health care that’s gone unfunded during the long-running impasse — hence the $4.1 billion deficit, according to the analysis.
Again, policymakers don’t care a huge amount about this fiscal year because it’s already half over, so coming up with a complete, balanced solution by the end of this June would be too painful on both the revenue and spending sides. There is a big push, however, to get a balanced budget by the end of next fiscal year. That’s understandable and desirable.
* Subscribers have a copy of the complete GOMB analysis (plus an analysis of the Senate’s “reform” proposals), but here’s what it says about FY 18…
Annualizing the new revenue sources in the Senate Plan for FY18 brings in an additional $5.4 billion in revenue compared to previous GOMB revenue estimates. This would bring total available general funds resources to $38.8 billion.
The Senate Plan does not include appropriations for FY18. As such, spending estimates rely on spending estimates previously contained in the GOMB 5 Year Report issued in November of 2016, which placed FY18 expenditures at $40.6 billion. Several items in the Senate Plan require adjustments to this spending level, including $650 million in pension savings, $85 million in procurement savings, an increase of $221 million related to CPS pension parity, and $1.1 billion in debt service for the $7 billion on General Obligation Bonds included in the plan to pay down old bills. With these adjustments, FY18 spending would total $41.1 billion.
With $38.8 billion in available resources, the projected spending total of $41.1 billion would lead to an FY18 budget deficit of $2.3 billion.
The Senate Democrats disputed these numbers yesterday, but haven’t yet put that on paper.
*** UPDATE *** From the Senate President’s spokesman…
We’ll check it out and see if changes need to be made.
The goal all along has been to produce a balanced, sustainable budget. We filed the legislation to invite input and constructive criticism.
The proposals remain under construction. We’ll look into this and take steps as needed.
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Moody’s: Get a sustainable budget already
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Moody’s Analytics has prepared yet another economic forecast for the state. The whole thing is worth a read, but here’s some of it…
Illinois is one of the Midwest’s weakest links, reflecting both soft job creation and the state’s descent into fiscal quicksand. The state trails the nation in most metrics and political gridlock is imposing significant economic costs. The jobless rate has resumed its descent after rising late last year into early 2016, but much of the decline owes to a sharp drop in the labor force and population losses. […]
To be a solid-performer longer term, the state must navigate its fiscal challenges without doing lasting damage to its business climate. The state’s demographics present it with another challenge, as an aging population coupled with a trend toward fewer workers hampers job and income gains, which are forecast to be below average over the extended forecast horizon. […]
Aside from private industries, the state’s fiscal problems have worsened. Repeated credit downgrades will harm Illinois’ economic climate. […]
Illinois’ budget problems are its biggest headache, and an escalation of the state’s fiscal problems and weakness in the public sector suggest limited upside potential even as other parts of the economy improve. […]
Business climate. Illinois, and Chicago in particular, is in general an appealing location to corporate headquarters and companies that need highly skilled workers and are willing to pay for top talent. Despite Illinois’ advantages, however, uncertainty stemming from the state’s fiscal crisis threatens to discourage firms from locating or remaining in the state. This is a concern since manufacturing in the state is already sputtering, and downstream industries have been strong performers for Illinois during the recovery and in years past.
Although lawmakers are mindful of their state’s business tax climate, in the past they have often opted to entice businesses with lucrative tax incentives and subsidies instead of broad-based reform aimed at reducing the above-average personal and corporate income tax burdens prevalent in the state. There is a recurring pattern of such behavior in Illinois, and it is not clear whether business incentives will generate enough money to pay back these costs. A far more effective method to improve the business tax climate over the longer term is to focus on more broad-based income tax reforms and provide firms more certainty as to what their future tax burdens might be. This can be accomplished only by getting the overall budget situation on a more sustainable, and certain, path. […]
The state’s longer-term outlook is tarnished primarily by its budget woes and weak population trends, not its high costs relative to nearby states. Business costs in the state are lower than they are nationally and have trended downward for the past few decades. Costs are lower than those in Wisconsin and Michigan but higher than those in neighboring Indiana, Iowa, Kentucky and Missouri. Firms in Illinois tend to pay less in taxes and their utility costs are below average, but labor is on the expensive side. By and large, though, business costs are pretty favorable and lower than those in states that have similarly large metropolitan areas with unique features that appeal to businesses such as California and New York.
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Our sorry state
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* David Leonhardt at the NY Times…
(T)he earnings gap between four-year college graduates and everyone else has soared in recent decades. The unemployment rate for college graduates today is a mere 2.5 percent. […]
The share of lower-income students at many public colleges has fallen somewhat over the last 15 years.
The reason is clear. State funding for higher education has plummeted. It’s down 19 percent per student, adjusted for inflation, since 2008, according to the Center on Budget and Policy Priorities. The financial crisis pinched state budgets, and facing a pinch, some states decided education wasn’t a top priority.
“It’s really been a nightmare,” said Diana Natalicio, UTEP’s president and herself a first-generation college graduate. “The state does not recognize — and it’s not just in Texas — the importance that the investment in public education has for the economy and so many other things. Education was for me, and for many of the rest of us, the great opportunity creator.”
* The chart…
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I hadn’t thought of it that way
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* But he’s right…
Heh.
* Meanwhile, Greg Hinz updated his story from yesterday to say that Bobby Rush isn’t going…
According to his office, “The congressman will not attend as his wife is hospitalized.”
* And Greg points to this tweet by Jan Schakowsky…
* Back to Gov. Rauner…
Gov. Bruce Rauner told reporters Tuesday that his choice to skip President-elect Donald Trump’s inauguration wouldn’t have a negative impact on Illinoisans.
“People understand in Washington and around the country that Illinois has big challenges and they know, and respect the fact, that I am one hundred percent focused in Illinois, working on getting a balanced budget with structural change to the system,” Rauner said. “And they respect that and they appreciate it.”
Yeah. People all over the country know he’s working so very hard. /snark
More…
“I do have close, good working relationships with a number of incoming members of the Trump administration, as well as members of his transition team, and I’ve worked with the Vice President-elect for years,” Rauner said. “There’s no issue of us not having a good, solid working relationship with the incoming administration.”
Rauner noted that he “worked hard” to form a close relationship with the outgoing Obama administration, including former Secretary of Education Arne Duncan and Secretary of Commerce Penny Pritzker. He now hopes to work with the Trump administration on infrastructure and schools in Illinois.
He worked so hard forming close ties to Penny Pritzker that she’s now “all in” for one of Rauner’s top opponents. /snark2
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Question of the day
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Demonstrations at the Statehouse are currently banned above the 1st Floor…
No demonstrations are allowed above the first floor of the Capitol Building; this includes singing, chanting or shouting in a loud voice of the type that could interfere with the business conducted in the building.
* Definition of demonstrations…
“Demonstration” means demonstrating, picketing, marching, rallying, selling non- commercial printed matter or materials, moving in procession, holding of vigils, singing, chanting, or shouting in a loud voice of the type that could interfere with the business conducted in the building, and all other forms of public demonstrative activity that involve the communication or expression, orally or by conduct, of views or grievances, engaged in by one or more persons, the conduct of which has the effect, intent, or propensity to draw a crowd or onlookers within 100 feet of the buildings named in Section 2005.10, on the Capitol Complex grounds, or within the building or the Capitol. Demonstration shall also mean demonstrating, parading, picketing, speechmaking, holding of vigils, sit-ins, or other activities, conducted for the purpose of demonstrating approval or disapproval of governmental policies or practices (or the lack thereof), expressing a view on public issues, or bringing into public notice any issue or other matter. However, nothing in this Part shall be construed to govern lobbyists or lobbying as defined by the Lobbyist Registration Act [25 ILCS 170], nor shall a demonstration mean the peaceful contact or discussion by one or more persons with elected representatives during a legislative session, or with executive branch officials, concerning their view on a public or personal issue.
* The Question: Should this demonstration ban be rescinded? Take the poll and then explain your answer in comments, please.
bike trails
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Rauner: “We need a capital plan”
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Today in Champaign, Gov. Rauner said he wants a capital plan…
I’d like to get a balanced budget and a capital bill with a balanced budget, and put a lot of resources into our universities across the state, but especially U of I… The U of I is a major economic engine for this state and I want to take them to a whole other level… We need a budget to do it, we need a capital plan to do it…
He didn’t say when he’d like to roll out a capital plan or how he intends to pay for it, however.
* Raw audio…
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Exelon files yet another appeal on Byron plant
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Every year since 2012, Exelon has appealed the property tax assessment on its Byron nuclear power plant. The 2012 case finally made it to the Illinois Property Tax Appeal Board this past spring when it held a hearing that lasted six weeks. The board hasn’t yet issued a ruling because lawyers are still arguing the case.
And so, right on schedule, Exelon has filed yet another appeal, which seems a bit greedy since Exelon just got a big state bailout.…
Exelon Generation officials say the $546 million assessment, set in the fall by county Supervisor of Assessments Jim Harrison, is about 48 percent too high. Their appeal sets the value at $295 million. […]
Harrison set the plant’s value $64 million higher than last year’s assessment of $482.4 million because Exelon officials succeeded in late 2015 in getting the licenses renewed for the two reactors for 20 more years. […]
Exelon paid more than $33.7 million in real estate taxes in 2016 to 11 taxing bodies: Ogle County, Rockvale Township, Byron School District, Oregon School District, Oregon Park District, Byron Fire District, Rock Valley College, Byron Public Library District, Byron Museum District, Byron Forest Preserve District, and Kishwaukee Community College.
The Byron School District received the largest share – $18.6 million.
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The Pepsi challenge
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* The Southern Illinoisan takes a look at the proposed sugary drink tax…
As frequent retailers themselves, [John Rains, executive vice-president and general manager of Pepsi Mid-America in Marion] said, schools might also feel the sting.
“Schools rely on businesses in the area to support a lot of their programs and businesses won’t be in a position to be as supportive,” he said. “And the schools themselves if they’re going to (use the products) for resale are going to be taxed.”
Overall, Rains said he would prefer legislators to focus on spending.
“Rather than continue to put burdensome taxes on the consumers, they need to look at running the state in a more professional and businesslike manner,” he said. “You just can’t tax, you have to look at how you’re spending money.”
Easier said than done, John. My advice would be to either suggest ways to cut spending or increase revenues, because this tax is most definitely in the mix.
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Put up or shut up
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Illinois Policy Institute…
One of the most foolish things politicians can do to an economy suffering from a weak recovery and a shrinking tax base is to pass tax hikes. Hitting residents and businesses when they’re struggling risks sending a faltering economy into a tailspin.
And for an economy edging toward recession, tax hikes are even worse.
Unfortunately, a multibillion-dollar tax hike is exactly what Illinois politicians are proposing for a state economy that’s been remarkably weak and is now showing signs of recession-like shrinkage.
Illinois’ falling tax collections hint at looming recession
According to the December 2016 monthly briefing from the Commission on Government Forecasting and Accountability, or COGFA, Illinois’ corporate income tax collections are down $386 million in the first six months of fiscal year 2017, when compared with the same time last year.
Personal income tax revenues are off by $189 million. And sales tax collections are also weak, up only $45 million.
State revenues are down by nearly 5 percent year to date, and when all sources are taken into account, total revenues are down nearly 7 percent.
There’s no doubt that tax hikes right now aren’t optimal. But they never are.If the economy was going strong I assume the “Institute” would warn against harming the economy’s success.
But how would the “Institute” balance the budget? They don’t say. Drastic spending cuts will make things worse as well, after all. Much worse, considering how badly the budget is out of balance.
And it’s also quite possible that the impasse, with its reduced spending, is doing damage to the state’s economy.
So, let’s just get on with it, already. There’s nothing fiscally conservative about allowing unpaid bills to pile up by the billions year after year.
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Survey finds substitute teacher shortage
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Kiannah Sepeda at the AP…
Public-school administrators are scrambling to find substitute teachers for as many as 600 Illinois classrooms a day, a survey finds.
The review released Tuesday by the Illinois Association of Regional Superintendents of Schools revealed that teachers call in more than 16,500 absences each week. School officials have trouble finding replacements for nearly 20 percent of them.
Association president Jeff Vose, who is regional school superintendent for Sangamon and Menard counties, said that a 2012 increase in substitute teacher certification requirements may have discouraged some educators from applying to be fill-in teachers. The law increasing certification requirements raised the application fee to $100, bringing applicants’ total registration costs to around $200. It also added a background check to ward off concerns about “educator misconduct with students,” which accounts for roughly $50 of the total fee.
“Districts are desperate to get quality individuals,” Vose told The Associated Press in a phone interview Tuesday. “However, at some point, they’re just searching for a body to be in front of the classroom.” […]
Schools are amplifying recruiting efforts, helped along by a new law set to take effect next year. That law, signed by Gov. Bruce Rauner last week, will reduce the application fee by $50 and remove a pending basic skills test requirement.
It might also help to pay them more because as the economy has improved people have found full-time gigs. But, hey, money is always tight.
* The survey results are here. From the summary…
The survey of nearly 400 districts found:
* Schools have to cover more than 16,500 absences each week
* Schools cannot find substitutes to cover more than 3,000 absences each week, or about 18 percent of total absences (600 classrooms per day)
* Total absences are more common in schools in the Chicago suburbs. Substitute teacher shortages are more of an issue outside Chicagoland, led by southern and western Illinois.
The survey found that districts in far southern Illinois can’t find substitutes to cover teacher absences 26 percent of the time every week. The number was lowest in the Chicago area, but 16 percent of absences still can’t be covered there.
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Pot, meet kettle
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* We’ll get back to the rest of this Tribune article a bit later this morning about the Senate’s “grand bargain” plan, but I wanted to highlight the end of it first…
Both chambers would have to agree on any budget plans before they’d reach Rauner’s desk. The division in strategy between the chambers already has raised some doubts.
“My experience has been, all the past budget plans we have passed have been in a bipartisan fashion, with all four caucuses and the governor engaged. Until we do that, based on what I’ve seen so far, nothing is going to happen,” said Rep. Fred Crespo, a Democrat from Hoffman Estates who serves on a House appropriations committee. “We can’t divide it this way, it just doesn’t work.”
That’s kinda rich coming from a guy in a caucus which as recently as last May attempted to unilaterally ram through a partisan budget that went nowhere in the Senate.
The House Democrats are infamous for their “take it or leave it” budget plans, often sending a package across the building and then adjourning.
* Yes, Crespo’s right that everyone will eventually have to be “engaged.” As I’ve already said, the Senate’s proposal should be seen as a bipartisan counter-offer to the governor. If it passes (and that’s still an “if”), the House can then put its own stamp (partisan or bipartisan) on the proposal or come up with its own counter-offer or just do nothing and everything collapses.
But don’t talk to us about “dividing” it this way. After what happened last year, the House Democrats have no room to criticize.
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Proft gets another cash infusion from Uihlein
Wednesday, Jan 18, 2017 - Posted by Rich Miller
* Tribune…
Liberty Principles PAC, the political committee run by radio host and former candidate for governor Dan Proft, reported a $500,000 contribution from Richard Uihlein, CEO of the packaging supply company Uline. The group works to elect Republican candidates to seats in the Illinois Capitol.
The group is also seen as a possible threat to Republicans who vote for an agreed tax plan.
Proft’s PAC ended 2016 with about $437,000 in the bank and $275,000 in debt, split between his gubernatorial campaign PAC and the Illinois Opportunity Project, a group he founded that spent hundreds of thousands of dollars last year backing Rep. Ken Dunkin (D-Chicago).
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