Emanuel to unveil CPS funding plan tomorrow
Thursday, May 18, 2017 - Posted by Rich Miller
* DNA Info…
Mayor Rahm Emanuel will brief aldermen Friday on how his administration plans to fill the $129 million budget gap facing Chicago schools.
Schools will not see additional cuts this school year, according to a City Hall source.
Nor will the mayor propose any new taxes to fill the massive budget gap because there simply would not be enough time to implement a new tax, the source said.
“After a lot of hard work by the CPS and city financial teams, and many discussions with their lending partners, tomorrow we will brief aldermen on the district’s finances and the financial plan for the remainder of the CPS fiscal year,” said mayoral spokesman Adam Collins.
“Lending partners.” Hmm.
…Adding… Yep. Borrowing…
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Question of the day
Thursday, May 18, 2017 - Posted by Rich Miller
* Democratic gubernatorial candidate Ameya Pawar just finished an “Ask Me Anything” event on Redditt. Click here to see it.
* From The Economist…
Even so, says Christopher Mooney of the Institute of Government and Public Affairs in Urbana, it is not inconceivable that a less well funded candidate, such as Mr Pawar or Mr Biss, might win the Democratic primary next March. Mr Pawar makes a persuasive pitch to progressives, promising a “new deal” with more funding for public schools, universal child care, legalised pot, big investments in infrastructure and reform of the criminal-justice system. He points out that he is the only person of colour in the race in a state where, by 2020, most children will be either from a minority or mixed-race. And he promises to fix Illinois’s abysmal finances with a progressive income tax and the elimination of tax loopholes for companies.
* The Question: What do you think is Pawar’s best path to victory?
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* We talked about this yesterday, but here’s a refresher from the Tribune…
Illinois House Republican leader Jim Durkin has joined the GOP’s efforts to keep in the news Democratic governor candidate J.B. Pritzker move to secure property tax breaks for a Gold Coast mansion declared “vacant and uninhabitable.”
The Chicago Sun-Times reported last week on the tax relief, and Republicans have focused on the issue for days. Durkin signed to a bill that would allow local taxing bodies to file a complaint if a property owner getting vacancy relief isn’t attempting to sell, lease or alter it. The plan also lays out penalties for those found in violation, including a ban on tax breaks until the property is sold or leased.
Democratic Rep. Robert Martwick filed the measure back in February, but Durkin didn’t add his name as a co-sponsor until Wednesday, after the Pritzker story broke.
* Martwick just issued a statement…
Leader Durkin’s move to sign on as a chief co-sponsor of House Bill 2517 and publicly announce it this week is disappointing, counterproductive and out of character for him.
Vacancy fraud is an important and complex issue, and one that I have been working on for several years to address the growing number of buildings left intentionally vacant in the city of Chicago by their owners for tax benefits. I have made good progress on this issue but decided to continue to work with the various stakeholders in hopes of movement next session. The bill is in the House Rules Committee and I have no intention of calling it for a vote this year.
Leader Durkin’s move smacks of political gamesmanship, and I have to believe it is being driven by the governor’s office in light of recent media reports on the governor’s race. There is no place for such political games on an important issue like this. I urge the governor, Leader Durkin and all of my colleagues in the final two weeks of the session to end the shenanigans and refocus on the critically important task of getting a state budget agreement to move our state out of this crisis.
Except by sending out this release he kept the story alive and kinda bashed Pritzker in the process.
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Civic Committee: Get moving on a budget now
Thursday, May 18, 2017 - Posted by Rich Miller
* This group is the one that Ty Fahner used to run. Greg Hinz takes a look at its new report…
Warning of a looming “catastrophe,” a key Chicago business group today effectively sided against Gov. Bruce Rauner in the state’s bitter budget war.
In an extensive report, the Civic Committee of the Commercial Club, which represents the region’s largest employers, threw its backing behind efforts to pass a budget that includes considerably more new revenues than spending cuts, and which downplays Rauner’s demand for “structural changes” such as a property tax freeze and workers’ compensation reforms in exchange for any tax hike. […]
Committee Chair Rick Waddell, CEO of Northern Trust, conceded in an interview that, while the framework laid out in the report urges changes in the workers’ comp system, it is silent on a proposed property tax freeze and links neither issue to passage of a budget.
“At this point in time, the necessity and imperative of getting the budget done” is paramount, he said. “We’re in a crisis situation.”
If the Legislature and governor again agree only a patchwork stopgap budget that lacks needed revenues, the state’s financial status and ability to retain and attract employers and talent will take a hit, he added.
“It would be catastrophic if we couldn’t market our debt, which could happen” if bond-rating agencies lower their view of Illinois securities to junk levels, as they have threatened to do.
Click here for the full report. They’re proposing $8 billion in new revenues and $2 billion in spending cuts, which is considerably more liberal than the budget which was mostly agreed to in the Senate.
* From Mayor Rahm Emanuel…
“I applaud the Civic Committee for presenting an honest report about the state of Illinois finances, the challenges we all face, and the avenues to invest in our future and drive economic growth for families in every corner of the state. While there are many opinions about the best path forward for the state, the Civic Committee’s thoughtful report underscores the importance of fiscal stability for economic growth, the truth that both revenue and reform are needed, and the fact that progress is possible.”
…Adding… Tribune…
Missing from the wide-ranging set of recommendations was any mention of property taxes, which are a key driver of costs for Illinois homeowners and businesses. A property tax freeze has been one of Rauner’s top requirements in return for signing off on tax increases.
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* The story got picked up by the AP, so it went out far and wide…
A Democrat running for Illinois governor in 2018 is calling for the impeachment of President Donald Trump.
J.B. Pritzker said in a statement Wednesday the House of Representatives should begin impeachment proceedings. He says there are “credible reports” that Trump “obstructed justice in the investigation of the Russian hacking of our democracy.”
Pritzker was a top supporter of Hillary Clinton, helping raise millions for her unsuccessful campaign against Trump. The Chicago billionaire says calling for impeachment is “not something done lightly” but that it’s necessary.
* The Tribune’s take…
Trying to shift away from days of criticism over the property-tax issue, Pritzker on Tuesday turned to Washington with a call for the U.S. House “to begin the impeachment process based on credible reports that President Donald Trump has obstructed justice in the investigation of the Russian hacking of our democracy.”
Whatever works, I suppose.
* Pritzker issued yet another press release today…
“Yesterday, I called on Congress to begin impeachment proceedings against Donald Trump,” said JB Pritzker. “With credible reports that President Donald Trump obstructed justice in the investigation of the Russian hacking of our democracy, I knew it was time to act. But Bruce Rauner remains silent. Rauner continues to fail this state and his refusal to speak out as Donald Trump decimates our democracy is unacceptable. The President is putting our national security at risk and undermining our rule of law. It is time for Governor Rauner to put partisanship aside and stand with Illinois families instead of Donald Trump and his hurtful agenda.”
I asked the Rauner folks and the ILGOP for a response a few hours ago and haven’t yet heard back.
* Meanwhile…
* And…
State Sen. Daniel Biss is already putting money behind digital ads calling for Trump’s impeachment: “Trump’s shameless abuse of power puts the safety and security of all Illinoisans in jeopardy. It’s time for Congress to hold him accountable and begin drafting articles of impeachment.”
…Adding… Press release…
Ameya Pawar, 47th Ward alderman and Democratic candidate for Illinois governor today announced he is introducing a resolution to the Chicago City Council urging the United States House of Representatives to initiate an investigation to determine if there is sufficient grounds for the impeachment of President Donald J. Trump. Ald. Pawar will file the resolution to be considered by the City Council at the next scheduled meeting on May 24.
“I’m introducing a resolution at City Council next week calling for the Illinois Congressional Delegation and Congress to start the impeachment proceedings,” Pawar said. “I believe it is now time for Congress to start taking up impeachment proceedings and move on that quickly.”
“Trump has failed to divest himself from his business interests and it certainly appears he has obstructed justice by firing the FBI director. If he hasn’t already broken the law, he is dangerously close. And I think it’s time to get to the bottom of this so we can begin to take the next steps as a country.”
“Our country is in a really bad place right now. The billionaire class is eroding people’s trust in public institutions. The one thing that keeps me grounded and positive out of all this is that our institutions are fighting back and information is getting out. We need to take action, to determine once and for all if he is unfit to serve as our Commander and Chief.”
If the resolutions passes, the City of Chicago would be the largest city in the country to call upon Congress to begin impeachment proceedings. As the third largest city in the nation, 2.7 million Chicago residents are directly impacted by President Trump’s executive orders targeting people based on race, color, ethnicity, religion, gender, national origin, sexual orientation, gender identity, immigration status, and disability status. The President’s agenda threatens people’s quality of life and, in many cases, directly violates the United States Constitution and erodes the spirit of our democracy.
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Yield spread widens as deadline nears
Thursday, May 18, 2017 - Posted by Rich Miller
* Bloomberg…
With less than two weeks left in the regular legislative session, Illinois lawmakers and Governor Bruce Rauner are still divided on how to end the worst-rated state’s nearly three-year budget impasse. Investors aren’t pleased.
Bondholders are demanding yields of 4.49 percent on Illinois’s 10-year bonds, some 2.45 percentage points more than those of benchmark tax-exempt debt. That’s the biggest gap since the Bloomberg indexes began in January 2013.
After May 31, a three-fifths majority will be required to pass anything, making a deal even more difficult to reach. Senate Democrats advanced several bills that had been considered part of a bi-partisan compromise on Wednesday, but they were unable to pass a spending plan for lack of Republican support.
“We’re two weeks away from the 31st and that’s the deadline that’s set,” said Dennis Derby, a money manager in Menomonee Falls, Wisconsin, at Wells Fargo Asset Management, which holds Illinois bonds among its $40 billion of municipal debt. “They’ve had substantial time to work on this. So far we haven’t seen any substantial progress.”
* Chart…
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* Remember the story from Tuesday about how Rep. Dave Severin (R-Benton) took an excused absence rather than vote on a bill to save some nursing jobs at the Department of Corrections?
Well, Williamson County Democratic Party Chairman Cody Moake had this to say…
The reality of the situation is that Severin was elected by his constituents, not House leadership. If he cannot in good faith, complete the job he was elected to do, he should step down,” Moake said Tuesday. “While I did not vote for Mr. Severin, I expect from him, and everyone in the 117th should expect from him, to represent the best interests of the district on every issue that comes to a vote. We need someone to represent our area, home of some of the highest unemployed counties in the State. If he is not willing to stand up for these nurses, I want someone in there that will at least take a stance, not run away. If Mr. Severin is too much of a coward to stand up for what’s right, I urge him to step down and I challenge the Republican parties in the 117th district to appoint a representative that will keep our best interests in mind, and take those tough votes.
* Severin’s response…
In my short time in Springfield, I have seen the political games being played by Speaker Madigan nearly every day.
What was omitted from the previous reporting is the fact that prior to the bill being called, the administration informed me that they would rescind the corrections nurses’ layoffs and go back to the negotiating table, thanks to the urging of a number of my colleagues and me.
Knowing this fact ahead of time gave me the peace of mind I needed to know that the bill would not be necessary and was in fact yet another attempt by Speaker Madigan to drive a wedge between myself and my constituents for political purposes. Negotiations are continuing as we speak and I encourage both sides to stay at the table until a deal is reached.
* He then issued a follow-up statement through an unnamed spokesman…
“Williamson County Democrats are still trying to adjust to life without a Madigan enabler in office so I can understand their frustration. With that said, their calls for my resignation are bizarre, at best.”
* From The Southern…
Severin said he thought that leaving town made a louder statement than voting ‘present’ and he also said he surmised more people would ask him why he did it, giving him a chance to explain his predicament. Severin also said that when he left town, he had a private commitment from an aide to Rauner’s administration that the Illinois Department of Corrections intended to rescind its layoff notice in an effort to continue talks with the Illinois Nurses Association, which it has since done. Severin said he wasn’t allowed to say that at the time, because it had not been communicated to the INA. That decision was made, according to Severin, “thanks to the urging of a number of my colleagues and me.”
“Knowing that fact ahead of time gave me the peace of mind I needed to know that the bill would not be necessary and was in fact yet another attempt by Speaker Madigan to drive a wedge between myself and my constituents for political purposes.” Of note, during the campaign, Severin called a press conference at which he signed a blown up “Fire Madigan” pledge.
The INA, despite the rescinding of the layoff notice, has expressed its desire that the legislation proceed regardless, because there’s no certainty about what the administration will do with regards to privatizing the positions in the future, which was the plan IDOC announced in late March. The bill would require IDOC to maintain nursing staff levels as they were in January 2016. Severin said he’s not ready to say what he will do if Rauner vetoes the bill and its called for an override vote in the House. Newspaper ads purchased by the INA in recent weeks have asked Severin and other lawmakers to reconsider their positions. […]
And despite the criticism suggesting that he left town because he lacked the backbone to buck his own party’s leadership, Severin maintains that’s just not the case. “When I walked off the floor I walked off for my people,” he said.
I have been around this business a very long time and I have never seen anyone say they took a walk on a bill “for my people.”
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The myth of easy budget-cutting
Thursday, May 18, 2017 - Posted by Rich Miller
* BGA…
Perhaps the biggest impediment to an agreement is that the conventional stereotype of Illinois government as marbled with big ticket, easily cuttable fat defies reality.
On a per capita basis, no state government employs fewer people than Illinois. No state picks up a smaller percentage of local education bills. Per patient Medicaid spending is well below national norms. And the pile of debt now owed to state administed public pension systems is staggering. […]
The biggest components of the budget – state employee costs, schools, health care – don’t provide obvious cost savings that would make a substantial dent in the deficit. The state employee workforce of 62,000 in 2016 is down from 84,000 in 2002, a 26 percent reduction, according to the Comptroller’s office. Census data show Illinois has the fewest number of state employees per capita, among the states.
The Medicaid budget, the largest and fastest-growing piece of the Illinois spending document, stood at $17 billion in fiscal 2015, according to the Kaiser Family Foundation, behind Ohio, Florida, Pennsylvania, Texas, New York and California. But the amount Illinois spends per Medicaid enrollee stands at about $4,500, below the national average by about $1,400 a patient, Kaiser reports. […]
In the funding of public schools, no state spends less in support of K-12 education than Illinois, providing 26 percent of funds for school operations in the 2013-2014 fiscal year, according to the National Center for Education Statistics. The average among the states is 20 percentage points higher 46 percent. Cutting state support would increase pressure on local governments to boost their reliance on the property tax.
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* From GateHouse…
* Sfondeles…
The largest sticking point — with negotiations still ongoing — is a Republican and Rauner-sought four-year property tax freeze paired with an income tax hike. Democrats say they’ll only approve a two-year hike due to concerns over school districts. They said the two-year timeframe was attached to the original property tax bill Illinois Senate Republican Leader Christine Radogno, R-Lemont, sponsored in January.
Radogno noted the bill didn’t reflect the most current agreement regarding discussions to protect taxpayers in a “substantial” way. She urged senators to wait for an agreement.
“We made a lot of progress since then in terms of trying to accommodate each other’s point of view on how long this freeze would be. I think we all need to remember if our taxpayers at home are watching the one thing they universally care about are property taxes,” Radogno said. “It is driving them out of their homes. They care deeply about property taxes. And a simple two-year freeze is inadequate, and there’s been some other really good ideas floated out there that again I think we can come to closure on if we gave ourselves a little more time to do it.”
Cullerton denied that the bill was “inadequate.”
“It’s a Senate bill. It can be amended in the House and let’s pass it. Let’s pass a two-year freeze. If it’s working so well and constituents clamor for it, we can come back next year and we can extend it,” Cullerton said.
According to WalletHub, Illinois has the highest combined state and local effective tax rate in the country at 14.76 percent based on national median household income. That’s a point higher than the next state. California is at 8.79 percent.
For decades, the Democratic Party has been talking about giving homeowners some relief on their property tax bills. Remember the Dawn Clark Netsch plan? These days, the Democrats barely pay lip service.
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Why did the BIMP go down?
Thursday, May 18, 2017 - Posted by Rich Miller
* Sfondeles…
The budget bills came to a screeching halt because of no Republican support on a bill that would actually implement the budget, which included hundreds of millions of dollars in cuts. Republicans didn’t support the measure because they want to further negotiate on taxes. A revenue bill wasn’t called after that vote failed because the three — the spending plan, cuts and revenue — are intended to be passed together.
Senate Democrats on Wednesday night filed a motion to reconsider the bill that authorizes the budget.
* Sen. Daniel Biss on why he voted against the BIMP and the budget…
“Gov. Rauner expects lawmakers to give him unchecked freedom to overhaul the state’s Medicaid program that insures the poorest Illinois children and senior citizens, but he’s given us absolutely no reason to trust his judgment about what’s best for the people of Illinois.
“Gov. Rauner has refused to do his job and introduce a balanced budget and instead has claimed in public to support bipartisan Senate negotiations while secretly torpedoing that same work. We have no reason to trust him with carte blanche authority to destroy our safety net and punish the most vulnerable.
“I am not willing to give Gov. Rauner emergency rulemaking authority to implement Trumpcare in Illinois or cause undocumented children to lose coverage.
“In the meantime, Gov. Rauner is doing his best to dismantle the Community Care Program that tens of thousands of seniors rely on to live in dignity in their homes, and I cannot support a budget that facilitates his efforts to do just that.
“Our state urgently needs a budget, and I will continue to do all I can to move us toward a fair budget resolution that adequately funds our priorities. I stand ready to work with anyone toward that goal, and I am prepared to compromise.
“But I will not accept the premise that we must balance our budget on the backs of senior citizens and the poor.”
Subscribers know a bit more. The full roll call for SB 6 is here. The BIMP got 27 votes. Click here for the roll call and click here for the full text.
* Here’s where the cuts/reductions/transfers are. SB 6 is the approp bill. All numbers are in millions. From the Senate Democrats…
As you’ll recall from yesterday, the Senate Democrats put out a statement saying: “Our side of the aisle can’t, on its own, pass the list of cuts that Republicans brought to the table and we included.”
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* From the Illinois Policy Institute’s news service…
Of the grand bargain bills, Senate Bill 1 changes the state’s school funding formula. It passed, 35-18, with three lawmakers voting present. Under the legislation, the state picks up $135 million in annual pension payments for CPS while continuing to pay the school district about $250 million in annual block grants, which are not given to other Illinois school districts.
“How is that fair to other districts?” Illinois Sen. Jason Barickman asked on the Senate floor. “This keeps that Chicago block grant in perpetuity, forever. It picks up the Chicago Public School pension costs forever.” Barickman said Democrats like to talk about parity, but “giving special deals and special rules to Chicago isn’t parity.”
Rauner’s administration said the education funding bill passed by Senate Democrats Wednesday is not what was negotiated.
“This bill is not consistent with the framework of the bipartisan, bicameral School Funding Commission,” Illinois Secretary of Education Beth Purvis said in a statement. “Senator [Andy] Manar abandoned our bipartisan process, departing from agreements already finalized in the commission and forcing a Chicago bailout at the expense of every other school district in the state, some of which are in worse financial straits than CPS.”
* The gist of the sponsor’s response to the Chicago bailout allegation was briefly described by the AP…
The sponsor of the Senate proposal, Democratic Sen. Andy Manar of Bunker Hill, maintains that holding all districts harmless includes ensuring CPS does not lose funding.
That’s basically what Senate President Cullerton told reporters as well yesterday. The Republicans are pointing to money that CPS is still getting without mentioning that all districts are being held harmless.
* Manar’s press release was chock full of heat, but very little light…
“The Rauner administration and Republicans want to behave like this is a vexing new problem that Illinois has never tried to tackle before. The truth is this is a more than 20-year-old problem that we have studied to death, repeatedly debated and willfully ignored.
“In Gov. Rauner’s perfect world, Illinois’ aging public schools would feature teachers that are paid less, support services that are outsourced and very little accountability to the communities they serve.
“That’s not the world we live in. We owe it to our students of today and our students of tomorrow to deal with Illinois’ worst-in-the-nation school funding formula now. Educators, parents, taxpayers, students and advocates are clamoring for change, and we would be remiss to not get this done before May 31. Gov. Rauner knows this, and so does his education secretary, Beth Purvis.
“Here’s the bottom line: The only opposition that exists to Senate Bill 1 is from Bruce Rauner and his enablers, who for some reason refuse to show independence from the governor when it comes time to do the right thing.
“Gov. Rauner and his team can put out all the statements they want claiming I abandoned the bipartisan process. I can sleep at night knowing I’ve never abandoned Illinois students or leveraged the state’s future for a political agenda.”
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Unclear on the concept
Thursday, May 18, 2017 - Posted by Rich Miller
* Finke…
The Senate OK’d a $36.5 billion spending plan, but failed to approve a key bill needed to implement cuts contained in it. The Senate also did not vote on a controversial bill to raise taxes needed to balance the spending plan.
Senate President John Cullerton, D-Chicago, said it will up to the Republicans to decide when they’re ready to vote for the budget bills.
“I was under the impression we had reached an agreement on the budget,” Cullerton said after the votes. “The issue is, why did the Republicans not vote for the budget?”
Republican senators, though, again said that negotiators from both parties are getting close to agreement on the remaining outstanding issues and more time is needed. They accused Cullerton of staging a “political show” with the votes Wednesday.
* From an analysis issued by Cullerton’s office yesterday…
Negotiations [with the Republicans] left a $475 million gap between spending and revenue. This [Democratic] plan closes it by means testing certain income tax breaks, adjusting the borrowing to pay old bills plan and making $60 million in additional reductions.
So, there was no agreement on the budget.
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* Not a whole lot of new stuff here, but I thought you might want to rate this one…
On day 686 without a state budget, Bruce Rauner reported a $20 million contribution from Ken Griffin. The contribution is the largest individual contribution by a noncandidate in Illinois state history.
The staggering figure begs the question: What has Ken Griffin seen from Governor Rauner’s time in office that makes him think he’s worth $20 million dollars?
In making the contribution Ken Griffin stated, “he has the winning plan to create jobs, improve our schools and put Illinois on the right path forward.”
Is it a secret plan? Because here’s what Illinoisans have actually seen from Governor Rauner’s time in office:
687 days without a state budget.
$14.3 billion in unpaid bills.
A state economy in crisis, with jobs and businesses leaving the state and workers giving up on finding employment.
Cuts and unpaid bills to Illinois schools, leading to plans for layoffs and slashing of programs.
Attacks on unions and the rights of working families to organize.
“Bruce Rauner is being rewarded by his special interest friends for failing to produce a budget, putting our schools and our state economy at risk, and attacking our working families,” said Pritzker campaign spokeswoman Jordan Abudayyeh. “It’s clear that Bruce Rauner and Ken Griffin’s Rauner-Trump agenda does not work for Illinois families. Rauner’s broken promises and made up plans won’t solve this crisis of his own making. Illinois families are ready for a leader like JB who will stand with them to clean up Rauner’s mess.”
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Support High-Performing Charter Schools
Thursday, May 18, 2017 - Posted by Advertising Department
[The following is a paid advertisement.]
Charter schools operate best when local communities, parents, teachers and school boards work together to offer the best options possible for all of our children. HB 768 supports that effort and promotes local control in establishing quality public charter schools.
The State Charter School Commission will remain in its current role as the authorizing entity for currently existing state-mandated charter schools. Their effective work in this role will not be impeded in any way with the passage of HB 768.
Let’s work together to ensure quality public charter schools for all the children in Illinois. Support HB 768.
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