* The Commission on Government Forecasting and Accountability hired the actuarial firm Segal to look at “safe harbor” questions surrounding the Tier 2 pension systems. The report was written by Senior Vice President & Consulting Actuary Matthew Strom…
As requested, we are providing narrative and analysis regarding the impact of changes to the projected costs of the Teachers’ Retirement System of the State of Illinois (TRS), State Employees’ Retirement System of Illinois (SERS), and State Universities Retirement System of Illinois (SURS), based on potential benefit formula changes needed to maintain exemption from Federal Insurance Contributions Act (FICA) taxes.
* Tier 1 survives the test, of course. Not so with Tier 2…
• The following benefit formulas do not satisfy a safe harbor under the applicable IRS regulations
As such, individual testing may be required.
* Important point…
Note that the sample safe harbor tests shown in this letter (as defined below for FICA purposes) are included for illustrative purposes only. Neither Segal nor CoGFA is in possession of the data needed to determine the number of members who are not in compliance with the current safe harbor provisions. It is our understanding that, ultimately, it is the responsibility of the individual employers within each System to determine whether they qualify for exemption from FICA taxes.
* What that individual testing means…
The IRS has provided guidance on determining whether a system’s benefits are comparable to Social Security in Revenue Procedure 91-40. The guidance provides for three levels of testing:
• If the benefit provisions meet certain requirements, then the System qualifies under a safe harbor and no further testing is required.
• If the System does not satisfy the safe harbor requirements, then individual testing can be performed to confirm that the benefits for active members of an employer meet the minimum benefit requirements.
• Treas. Reg. 31.3121(b)(7)-2(e)(2) permits employers to compare the actual retirement benefits accrued by Tier 2 members to the estimated retirement benefits such members would receive from Social Security on an individual-by-individual basis. If the System’s benefit were greater for some or all Tier 2 members, those Tier 2 members would continue to be exempt from FICA taxes.
* Anyway, much actuarial language later, you get to the bottom line cost to put the pension systems in compliance…
Change in Total State Contributions Through FY2045 $5.606 billion
That works out to about $254.82 million a year if Illinois changed the program this year. The annual cost grows with any delays, of course, and it will grow because the budget has already been approved. A $2.1 billion up-front payment would wipe out the debt, but that isn’t likely.
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Afternoon roundup
Thursday, Jun 8, 2023 - Posted by Rich Miller
* Center Square…
The Illinois Psychiatric Society is offering a blueprint of policy pillars to drive conversations about the needs to treat the mentally ill.
The group’s reform ideas fit broadly into three categories: increasing equitable access to care, ensuring the various mental health systems of care are coordinating for patients’ benefit, and doing more to prevent mental health issues from developing and worsening.
“And how do we teach people about mental health, and really addressing families, parents and even faith leaders because a lot of times that’s really the place where you can reach people is at their churches,” IPS president Andrew Lancia said.
Several measures moved through the General Assembly during the spring session, including a bill that would increase the availability and accessibility of mental health resources for students.
Another measure, Senate Bill 724, would create an interagency youth services team to implement new technology for referring families to resources and improve service coordination to address behavioral health for children.
The bills cleared both chambers.
* Press release…
First-in-the-nation legislation introduced by Illinois Secretary of State Alexi Giannoulias aims to protect the privacy and safety of individuals seeking abortion care by restricting the use of Automatic License Plate Readers (ALPRs).
Giannoulias joined the sponsors of House Bill 3326, State Rep. Ann Williams (11th District – Chicago) and State Sen. Sara Feigenholtz (6th District – Chicago), along with Jennifer Welch, President and CEO of Planned Parenthood of Illinois and other supporters today to underscore the importance of this model legislation.
House Bill 3326, which passed the Illinois General Assembly last month and awaits the governor’s consideration, would prohibit the use of license plate readers from tracking individuals seeking abortion care or assisting them. No other state specifically prohibits ALPRs from being used to track or penalize individuals seeking abortion care or from criminalizing a person’s immigration status.
“No one seeking abortion care in Illinois should be harassed in any fashion, and I’m committed to enabling individuals to pursue and obtain the lawful healthcare they need without government interference,” Giannoulias said. “License plate readers are an important tool for law enforcement – especially when apprehending suspects in violent crimes or recovering stolen vehicles in car jackings – but we need to regulate these cameras so they aren’t abused for surveillance, tracking the data of innocent people or criminalizing lawful behavior. This legislation sets common-sense standards and protocols to ensure that license plate data is used properly.”
* Press release…
The General Assembly passed and Governor JB Pritzker has signed a fiscal year 2024 state budget that includes a historic appropriation of $2.53 billion for higher education, an increase of $279 million (12.4 percent) compared to the previous fiscal year and the largest increase in over 20 years. Notable highlights from the budget include a $100 million increase for the Monetary Award Program (MAP), an $80.5 million (7 percent) increase for public universities, $19.4 million (7 percent) increase for community colleges, a $3.8 million increase to the Minority Teachers of Illinois Scholarship Program (MTI) to recruit and retain minority teachers, and a $15 million increase for the AIM HIGH program.
The budget also includes an investment of $6 million for Grow Your Own (an increase of $3.5 million), $15.75 million for Golden Apple (an increase of $8.5 million) and $975,000 for the Teachers Loan Repayment Program (an increase of $535,000) – all of which are key in helping address teacher workforce needs.
“This year’s budget steps up our direct support for higher education institutions by $100 million—the largest dollar and percent increase in more than twenty years,” said Governor JB Pritzker. “And by raising the number and amount of college scholarships to a record-breaking, all-time high of more than $750 million, we’re making it possible for nearly every student from a working-class family to attend community college tuition free and fee free—a huge step towards closing the education gap and advancing equity here in Illinois.”
* Press release…
Governor JB Pritzker today announced the opening of a new homebuyer program designed to help increase home purchase accessibility for low- and moderate-income individuals, families and seniors interested in purchasing a home in Illinois. Administered by the Illinois Housing Development Authority (IHDA), Illinois HFA1 provides $10,000 for down payment and/or closing cost assistance to make buying a home more affordable. By offering a competitive interest rate and limiting the total fees charged to the borrower, IHDA programs are designed to be as affordable as possible. This can allow for substantial savings over the life of the loan. Funding for Illinois HFA1 is expected to assist more than 1,500 new homebuyers.
* Press release…
Today, the Administration for Strategic Preparedness and Response (ASPR) announced $2 million for Illinois to strengthen the Medical Reserve Corps (MRC) network – focusing on emergency preparedness, response, and health equity needs. Funding for the first-ever MRC State, Territory and Tribal Nations, Representative Organizations for Next Generation (MRC-STTRONG) grant program is from the American Rescue Plan.
The MRC of Illinois, in collaboration with the Illinois Department of Public Health, will use the funding to strengthen MRC’s capacity to respond by developing and implementing standardized training, grow and develop four new MRC units throughout the state in areas with greatest need and offer sub-awards to 50 MRC units in Illinois.
* Press release…
The Illinois Liquor Control Commission (ILCC) filed an emergency rule on May 26, 2023, to protect the public from confusion between alcoholic beverages and non-alcoholic beverages of the same brand and to prevent the marketing of alcohol to children. A “co-branded alcoholic beverage” is any alcoholic beverage containing the same or a similar brand name, logo, or packaging as a non-alcoholic beverage. The emergency rule applies to all establishments in Illinois that sell packaged alcohol for off-premises consumption.
Under the emergency rule, establishments with larger retail sales floors (exceeding 2,500 square feet) are prohibited from displaying co-branded alcoholic beverages immediately adjacent to soft drinks, fruit juices, bottled water, candy, or snack foods portraying cartoons or youth-oriented photos. Establishments with retail sales floors of 2,500 square feet or less must either: (1) comply with the display requirements for establishments with larger retail sales floors; or (2) post clear signage on every display that contains co-branded alcoholic beverages and is immediately adjacent to soft drinks, fruit juices, bottled water, candy, or snack foods portraying cartoons or youth-oriented photos.
* Sen. Andrew Chesney is, believe it or not, flat-out wrong…
Hidden within the pages of the 3,425-page budget and the accompanying 898-page BIMP is hundreds of millions of dollars toward free healthcare and other programs for illegal immigrants. Governor Pritzker’s own financial analysts put a price tag of $1.1 billion on this free healthcare program for illegals. In spite of his analysts’ cost estimate, the budget our Governor is touting as “balanced” only funds the healthcare program at $550 million. Gov. Pritzker has said no one currently eligible will be removed, so it’s pretty ridiculous to think the cost of the program will be half of what his own agency claims.
*facepalm*
The $1.1 billion was a projection for next fiscal year’s increase if nothing was done to rein in costs ahead of time. The governor had already set aside somewhere around $230 million extra for next fiscal year, so he can now use managed care (the recipients were among the few still receiving fee for service coverage), enrollment caps, etc. to stem the rest of the cost. This ain’t difficult to understand, unless possibly if you’re somebody who believes in the kitty litter myth.
* Media advisory…
40 years later Honoring Rudy Lozano
Black Brown Unity
BBQ + Showcase + Press conference
June 8 2023 5pm-7pm
Healthy Hood 2242 S Damen outdoor
During the 2020 unrest, after the assassination of George Floyd, the Black and Brown communities were pitted against each other. Grocery stores closing caused the crossing over of neighborhood borders with threat of violence so June 8 2020 the first Black Brown Unity event was held honoring Rudy Lozano and Harold Washington and the Rainbow Coalition
Now we see a similar tensions between our black brown communities around the immigrant refugee crisis.
That is why on June 8th 2023, the 40th anniversary of the assassination of Rudy Lozano a pillar in the Latino Community and across the city for his activism work in the labor movement and perhaps most notable role in the building of the black brown coalition during the Harold Washington campaign for mayor that ultimately made him a target and resulted in his assassinated.
SEIU Health Hood will come together to provide the education truth and transparency and love necessary and desperately need to meet the moment. A showcase of young leaders and change makers in music, poetry and art, who are tackling the issues of today with the examples of leaders of the past with a true people first approach.
* Wait. Nobody goes to Chicago…
More here.
* .435 ball and only 4 games out…
I’m going to my first Sox game of the season this month. I was dealing with session, but I also didn’t want to spend money to watch the dumpster fire when I could just watch one in Springfield…
* Isabel’s roundup…
* Illinois Times | Preparing for the centennial of Route 66: The effort, being coordinated by the Springfield-Sangamon County Regional Planning Commission with a $200,000 grant from the Illinois Department of Transportation, is taking place alongside planning to sketch out options for revitalizing housing stock and neighborhoods along a smaller section of Route 66.
* Daily Southtown | Protesters removed after disrupting Oak Lawn police commission meeting: Before Wednesday’s meeting, the groups said the commission removed three people from its May meeting, who shouted and interrupted the commissioners, and told them they were banned from the next meeting. The protesters claim that violates the Open Meetings Act.
* Illinois Times | Spreading fear about transgender people: YMCA of Springfield officials say “untrue statements” have been made online that a child was inappropriately exposed to male genitalia in a Y locker room by either a transgender female or a man pretending to be transgender. “These statements are false,” the nonprofit organization said in a news release June 2. “Any report of this nature would have been documented to authorities for investigation. The YMCA takes the protection of children very seriously.”
* Daily Herald | Bears have video chat with Chicago mayor ahead of possible stadium talks: “Today we met and discussed our shared values and commitment to the City of Chicago, the importance of deep roots and the need for equitable community investment throughout the city. We are both committed to the idea that the city and its major civic institutions must grow and evolve together to meet the needs of the future. We look forward to continuing the dialogue around these shared values.”
* Sun-Times | Johnson extends 12 weeks of parental leave to CPS: “I’m the mayor who said, ‘This is a really good idea. That we should get it done.’ And we got it done for the city. What sense would it make for me to then say, ‘But I want to deny it to every other person outside of the city of Chicago government proper’? That doesn’t make any sense. Think of the logic and the absurdity of that,” Lightfoot said on that day.
* Sun-Times | A list of every known Illinois resident charged in the U.S. Capitol breach: Thomas B. Adams Jr. of Springfield, an associate of Roy Franklin, was found guilty after a stipulated bench trial of obstruction of an official proceeding and aiding and abetting; and disorderly and disruptive conduct in a restricted building or grounds. He carried a “Trump” flag on the floor of the U.S. Senate during the breach. His sentencing is set for June 16.
* Fox Chicago | Thornton Township assessor says she was locked out of office after dispute with supervisor Tiffany Henyard: Not only had Elston been locked out of her own office, but boxes of sensitive documents she kept in her office were spread around the common area. “This was under lock and key,” Elston said, pointing to a box of files. “Now it’s just out in the open. So it has taxpayer’s names, addresses, telephone numbers, some of them even have a Social Security number.”
* Daily Herald | ‘Would you want this behind your house?’: Neighbors decry Elgin affordable housing plan: Development plans have been in the works since late 2020. A variety of projects involving up to 72 townhouses came to the city but failed to win the favor of staff members after the running afoul of the density and design guidelines that govern the city’s vision for the area.
* Block Club | At These Chicago Churches, Drag Performers Are Welcomed With Open Arms: ‘God Is Calling On Us To Expand Our Circles’: A few churches throughout the city regularly invite drag artists to perform in their sanctuaries, help lead worship services and read storybooks to children. Drag artists say that these experiences have helped them to better connect with their spirituality through safe community spaces. Church leaders say developing a more inclusive community has attracted more parishioners and helped to counteract traditional church structures that have harmed people for centuries.
* Aurora Beacon-News | Aurora Pride Parade on Sunday to feature largest number of registered marchers in event’s history: Ciesla believes the increase in participants is due to people’s excitement that the parade is occurring after last year’s parade permit was touch-and-go for a bit due to issues stemming from not having enough police officers signed up to work overtime or extra-duty shifts to provide security for the event.
* Crain’s | Moving to Miami? Go for the weather — not for the tax break, Chicago.: For people with a $650,000 salary who move from San Francisco to Miami, the savings is ballparked at around $150,000. But for residents of Chicago, where the cost of living is cheaper than San Francisco or New York, the savings were only about $10,500.
* SJ-R | City of Springfield will pay out over wrongful death lawsuit from 2008: Without discussion, the Springfield City Council unanimously passed an emergency ordinance Tuesday executing payment in a wrongful death lawsuit brought by the family of a teenager who drowned at Lake Springfield Beach in 2007. It included a $750,000 judgment plus a little over $100,000 in accumulated interest and costs, Mayor Misty Buscher said afterwards.
* Sun-Times | 10 years after mass CPS school closings, enrollment is even worse. What can be done?: This time, Chicago’s path forward falls to Johnson. He strongly opposes closing schools, calling it an ineffective and harmful strategy. But the new mayor faces powerful headwinds in his attempts to find alternate solutions.
* Sun-Times | Chicago area air quality improving, but wildfire effects may linger a few days: The air quality in some parts of southern Cook County, near Tinley Park, Dolton, South Holland and Chicago Heights, was classified as unhealthy for sensitive groups due to a high level of fine particulate matter in the atmosphere from smoke blown into the area.
* TPM | Climate Crisis Is On Track To Push One-Third Of Humanity Out Of Its Most Livable Environment: The research, which adds novel detail about who will be most affected and where, suggests that climate-driven migration could easily eclipse even the largest estimates as enormous segments of the earth’s population seek safe havens. It also makes a moral case for immediate and aggressive policies to prevent such a change from occurring, in part by showing how unequal the distribution of pain will be and how great the improvements could be with even small achievements in slowing the pace of warming.
* Crain’s | Muddy Waters house museum gets $1.1M grant, its biggest financial boost yet: The grant will go toward restoring the basement level, which will become the main exhibit space in the red brick two-flat at 4339 S. Lake Park Ave., and “will catapult us to the next level in the project,” Chandra Cooper, great granddaughter of the musician and president of Muddy Waters Mojo Museum, wrote in an email to Crain’s.
* Sun-Times | Chicago Blues Festival to kick off full force after pandemic cancellations, constraints: Nearly 50 acts will be spread across three stages this year, down from a pre-pandemic number of six stages — a change meant to eliminate sound bleed. The Jay Pritzker Pavilion will serve as the main stage and feature big names like John Primer and the Real Deal Blues Band at 7:45 p.m. Friday and Los Lobos at 7:45 p.m. Sunday.
* Daily Herald | A bear in the suburbs? Police investigate sighting near Gurnee Mills mall: The Chicago football team may not be the only bears exploring a move to the suburbs. Gurnee police said a real bear may have been spotted near Gurnee Mills mall on Wednesday.
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Question of the day
Thursday, Jun 8, 2023 - Posted by Rich Miller
* Press release…
Illinois’ first-ever student loan assistance program targeted to engineering students working at the Illinois Department of Transportation has become law with Governor JB Pritzker’s support and approval. The measure, sponsored by State Senator Ram Villivalam and supported by the American Council of Engineering Companies of Illinois (ACEC Illinois) creates a pilot program enabling the Illinois Department of Transportation (IDOT) to provide student loan repayment assistance to qualifying employees that meet certain requirements, helping to attract and encourage educated professionals to work on the state’s highest priority infrastructure projects.
Introduced by Sen. Ram Villivalam, the program was proposed by ACEC Illinois, passed into law and funded by the General Assembly with the provision of $750,000 in the budget to support it pending the Governor’s approval. The proposal provides for higher education student loan repayment assistance in the form of annual after-tax bonuses of $15,000 per year for not more than 4 years, for up to 50 engineers employed by IDOT. This will help address the shortage of skilled talent in the industry and help IDOT attract engineers and other qualified professionals to work on the state’s infrastructure projects.
“The inclusion of funding in the budget gives Illinois a competitive advantage when it comes to recruiting and retaining engineering talent and ensures that IDOT attracts educated professionals to work on our state’s road and transportation infrastructure,” said Kevin Artl, President and CEO of the American Council of Engineering Companies of Illinois. There is currently a shortage of about 82,000 professionals in the industry and the provision of student loan assistance will help draw talent both in-state and out-of-state to deliver key projects on time and within budget. We look forward to working with our policymakers on further incentives that will help transform Illinois into the top destination for engineers.”
“The promise of ReBuild Illinois can only be realized when we have the best professionals working on our infrastructure projects,” said Sen. Ram Villivalam. “The provision of incentives to attract the engineers to our state is a key element in ensuring the success of that promise and I will continue to work with my colleagues and other stakeholders on more initiatives to attract the best engineers so that the state’s infrastructure projects are delivered to the highest professional standards.”
* The Question: Should this $15,000 per year student loan assistance program be expanded and, if so, to whom? Make sure to explain your answer. Thanks.
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I’ll believe it when I see it
Thursday, Jun 8, 2023 - Posted by Rich Miller
* Crain’s…
Illinois’ efforts to lure a major electric vehicle battery plant here finally may be close to striking gold, as Gov. J.B. Pritzker is personally negotiating with multiple companies to come here.
Among the lures: hundreds of millions of incentives, in part coming from a recently authorized state “deal closing fund,” and in part a willingness by local municipalities to consider the type of long-term property tax breaks that factory owners are demanding. […]
Much of the chatter is about a site just off of Interstate 80 in Morris, 24 miles southwest of Joliet and 62 miles from downtown Chicago in Grundy County.
The deals are serious enough that Pritzker interrupted leadership talks in Springfield on a new state budget a few days ago to travel to Morris and meet with executives of the interested company to tour a site on the east end of town, multiple sources with direct knowledge report. It’s not known if Pritzker joined in the helicopter tour of the land, but he reportedly offered more than $600 million in potential incentives for the plant.
Fingers crossed, but not counting on anything.
* As you’ll recall, Stellantis’ Belvidere plant was idled months ago. From January…
Illinois has submitted what could be its best offer to keep the Belvidere Assembly Plant operating and save what could be thousands of jobs.
U.S. Sen. Tammy Duckworth, D-Illinois, said during a visit to Rockford that her office is supporting local and state officials in their efforts to keep the Stellantis plant open in Belvidere where 5,000 people worked a few years ago. Although details are unavailable because talks are on-going, Duckworth said the state submitted its latest offer Friday night.
Almost five months later and still no word on Illinois’ “best offer.”
* And this is ominous news from Ford…
Ford Motor Co (F.N) on Monday unveiled an ambitious strategy to profitably ramp up electric vehicle sales but faces a challenge to slash $7 billion in costs and regain credibility on Wall Street. […]
Ford, whose shares fell 1% at midday, estimated its total costs are $7 billion higher than its competition.
Also…
One way is to reduce investment in hypercompetitive market segments such as two-row smaller SUVs, [Ford CEO Jim Farley] told industry analysts.
Uh-oh. Ford’s Chicago plant, the oldest factory the company operates, assembles the two-row Ford Explorer. It does, however, assemble the three-row Lincoln Aviator.
And, of course, Rivian is having its own problems. Oy.
* Remember this column I wrote in February?…
Volkswagen filed a federal lawsuit in December describing a bill that overwhelmingly passed both Illinois legislative chambers and was signed into law in 2021 as “crony capitalism at work: redistributive legislation that takes hundreds of millions of dollars from some (but not all) motor vehicle manufacturers and, for no public purpose, deposits that money directly into the pockets of politically favored Illinois [car] dealers.” […]
The manufacturers say the law is costing the industry $240 million a year. Yes, you read that right. $240 million. Per year. They claim Illinois has the highest warranty repair costs in the nation. By far. […]
The subsidies the state can offer simply don’t compare with the gigantic annual cost of that 2021 law. Couple that with our high local property taxes (these electric vehicle plants take up huge amounts of space) and other costs and hurdles (Ohio, like Illinois, is not a “right to work” state but has a new concierge system to quickly clear red tape), and you can see why the state hasn’t yet convinced a national or international corporation to construct an electric vehicle-related facility here.
If Pritzker can lure a big, jobs-rich EV-related plant here, convince Ford to keep its plant open and prod Stellantis into reopening its plant, then he’s a hero. But color me skeptical on all three.
I try hard not to be a negative Nellie, but this state has a well-deserved toxic reputation with the auto industry.
…Adding… According to this article, Georgia gave Hyundai a $1.8 billion incentive package for an electric vehicle plant. North Carolina used $1.2 billion in incentives to land VinFast, a Vietnamese electric vehicle manufacturer. And South Carolina’s $1.3 billion state incentives package for Volkswagen included a $200 million loan from the state. Illinois’ $600 million kinda pales in comparison.
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* Jim Nowlan in the Tribune…
Gov. J.B. Pritzker and state lawmakers have recently been trumpeting the great financial shape of Illinois. Balderdash. And they know it. There will almost certainly be state tax increases by 2025. […]
The state legislature’s own budget forecasting agency predicted in March that by one reasonable scenario, the state’s operating funds in calendar 2025 will run at a deficit of more than $3 billion annually, with a whopping $18 billion in unpaid bills (from a total budget of around $100 billion).
A “reasonable scenario”? Balderdash.
I can’t believe we have to do this again, but here we go.
* From COGFA…
Scenario 3 assumes spending increases similar to the spending rates seen over the last five years of 7.1% per year on average. This scenario has the highest expenditure growth rate analyzed and leads to the least favorable results for the State. Expenditures grow to just over $61 billion by FY 2026. This scenario reflects deficits in all three years forecast and has the worst outcome when considering the aggregate accounts payable. After a surplus of $1.9 billion in FY 2023, a deficit of $3.1 billion occurs in FY 2024. This deficit grows to almost $6.4 billion in FY 2025 and $9.2 billion in FY 2026. Under this scenario, the accounts payable rises to $18.2 billion. This example shows that spending patterns seen in the past few years cannot continue without a comparable increase in revenues which is not seen in the Commission’s current estimates.
And this is what I wrote about that very same scenario in April…
Trouble is, that particular COGFA scenario is pure fantasy, likely included merely as a “what if.” Nobody is advocating that. Revenue and spending in that five-year average included huge amounts of one-time federal money to deal with the massive COVID pandemic, which is no longer with us. The spending also included billions of dollars in one-time approps to pay down gigantic amounts of debt, including for pensions and the unemployment insurance trust fund, rather than put the money into the spending base.
That scenario projected FY24 revenues of $50.41 billion and spending of $53.54 billion, for a deficit of $3.13 billion. In the real world, actual projected revenues are $50.6 billion and spending is projected at $50.4 billion.
The current projected spending for FY24, by the way, is lower than all of COGFA’s scenarios, which as I’ve pointed out before were just numbers games played by accountants who should know better than put that stuff into publication.
That current projected spending is even lower than COGFA’s most optimistic scenario, which predicted $50.9 billion in spending and a $495 million deficit with a tiny $37 million accounts payable this coming fiscal year. Accounts payable would rise to $1.455 billion by the end of Fiscal Year 2026. However, a $3 billion accounts payable level is considered a “normal” 30-day payment cycle. Accounts payables of $1.455 billion would mean the state’s bills would likely be paid within a couple of weeks.
* First, he cherry picked the worst possible fantasy scenario, and then he goes on to predict what taxes will have to rise to fill a budget hole that will not exist…
Let’s say Democrats decide they need to raise $3 billion a year to fill that projected deficit. Where to find the money? […]
But we won’t likely tax services and pensions, nor will we abandon the effort, unnecessary in my mind, to build up the pension nest egg — all are too hot to handle politically.
So, I fear Illinois policymakers will revert to the tried, true and simple; that is, raise the income tax rate. This would, unfortunately, encourage further flight of job creators and their wealth from Illinois.
Look, I’m not saying that a revenue enhancement of some sort is not in the future. Subscribers were told about one possible tax reform effort yesterday.
All I’m saying is that using an obviously way-out-there fictional scenario to make bold predictions about the future is not sound reasoning.
*** UPDATE *** Clayton Klenke at COGFA…
Like most of the publications that we do at CGFA, the 3-year budget forecast is driven by a specific state mandate. […]
We had internal discussions when the report was written on whether we should continue to use the same scenarios as we have in the past and in the end we chose to present the same scenarios – which is exactly what they are – scenarios. They are not budget predictions. They are examples of what would occur given certain scenarios. We recognized that scenario (3) included a higher growth rate than we would normally predict, and that is why we included the text to explain why that rate was higher than normally seen. Although we wouldn’t expect those circumstances to occur again, those spending levels were driven by actual needs to pay down a backlog of bills after a multi-year budget impasse, and also to deal with a worldwide pandemic – items not too many would have deemed plausible a few years ago.
As with all of our publications, we will continue to review our methodology as we develop future reports.
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Weiss trial coverage roundup
Thursday, Jun 8, 2023 - Posted by Isabel Miller
* Sun-Times report from the trial’s first day…
Weiss, a son-in-law of former Cook County Assessor Joseph Berrios, is charged with wire fraud, mail fraud, bribery and lying to the FBI.
Assistant U.S. Attorney Christine O’Neill spent about 15 minutes laying out the case to jurors Tuesday, alleging that Weiss bribed Arroyo and Link and then lied to the FBI about it, even claiming he’d spoken to a fictional “ghost of a person” named “Katherine Hunter” who was invented by the FBI as part of their investigation.
Then Sorosky took his turn, using nearly an hour to explain away allegations first leveled against his client in October 2020. Among them is the claim that Weiss paid $32,500 in bribes to Arroyo, who then pushed the sweepstakes legislation in the General Assembly. […]
Still, Weiss also hoped to pass sweepstakes legislation in the Illinois General Assembly. When his bill didn’t go anywhere, Sorosky said Weiss asked Arroyo to set up a meeting with Link, a key legislator on gaming.
“That’s not a crime,” Sorosky said.
* The Tribune…
Three weeks later, Link was again wearing an FBI wire when Arroyo allegedly delivered the first of the promised $2,500 checks at a pancake house in Skokie, O’Neill said. Arroyo and Weiss had driven to the meeting together, but Weiss stayed in the car. […]
O’Neill said that at the direction of the FBI, Link had them make the check out to a purported associate named “Katherine Hunter,” who didn’t actually exist.
When Weiss was later questioned by agents, he lied and said Hunter was a a lobbyist who lived in Winnetka and that he’d spoken to her on the phone, O’Neill said.
Sorosky, however, said Weiss did not intentionally lie to any federal official. Instead, during a “surprise” interview, he “did his best to cooperate with the FBI agent and tell the FBI agent the truth as best as he knew it,” Sorosky said.
* Moving on to yesterday’s coverage via the Sun-Times…
Under cross-examination by defense attorney Ilia Usharovich, Rita and Munoz confirmed that Arroyo never offered them any bribe.
But when the gaming bill passed without the sweepstakes provision, the feds say Arroyo and Weiss turned to Link, meeting with him at a Wendy’s restaurant in Highland Park on Aug. 2, 2019.
Jurors on Wednesday heard excerpts of the recording Link made of the meeting inside the restaurant that day. Though the conversation was difficult to hear in the courtroom gallery, it came across as a legitimate chat about the legislation — amid a fast-food restaurant soundtrack that included “Broken Wings” by Mr. Mister.
* Seidel…
* The Tribune…
When the trial resumes Monday, prosecutors are expected to play a key portion of the recording, when Link and Arroyo excused themselves from the table to talk privately outside. FBI agents stationed outside took surveillance photos of the two legislators talking that are expected to be shown next week.
“This is you and I talkin’ now. Nobody else,” Link said to Arroyo once they were alone, according to the charges.
“Whatever you tell me stays between you and me,” Arroyo allegedly responded. “That’s my word.”
During their purportedly private talk, Link told Arroyo he was “in the twilight” of his career and was “looking for something” to bolster his income. Arroyo said he would “make sure that you’re rewarded for what you do, for what we’re gonna do moving forward,” according to court records.
* Jason Meisner…
* Ray Long…
* Hannah Meisel…
Weeks later, Weiss and Arroyo again traveled north to see Link, this time at a diner in Skokie. But Weiss was left in the car for that Aug. 20, 2019, meeting while Arroyo went inside to deliver three things to Link: Weiss’ business card, a copy of draft legislation that would explicitly legalize sweepstakes machines, and a signed $2,500 check with the payee line left blank.
Link told Arroyo that the name on the check would be a “friend” of Link’s named Katherine Hunter – who turned out to be a fictional person made up by the feds.
Sorosky told the jury on Tuesday that Weiss honestly believed that Katherine Hunter existed, and therefore hired her in good faith to appease Link, who at the time was the lead negotiator on gambling legislation in the Illinois Senate.
He also directed the jury to focus on Link’s “What’s in it for me?” question to Arroyo, noting that it occurred “outside the hearing and presence of Jim Weiss” and was a clear indicator that Link solicited a bribe at the behest of federal agents.
“And with all due respect,” Sorosky said, “the original bribe in this case is created by the government.”
* Jon Seidel of the Sun-Times…
…Adding…
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Um, what?
Thursday, Jun 8, 2023 - Posted by Rich Miller
* For a publication dedicated almost solely to excerpting other outlets’ product, you’d think they would try to avoid insulting so many reporters by broadly mischaracterizing their work…
Almost unnoticed was a reduction veto — only Pritzker’s second veto in the five years he’s signed budgets. In a statement, the governor’s office described it as a fix for an “inadvertent” mistake when lawmakers last month voted themselves a 5.5 percent raise. State law says the maximum they can get is 5 percent. The tweak puts legislative salaries at $89,250 starting July 1, instead of $89,675.
Almost unnoticed? Only if you think unnoticed means ubiquitous.
Tribune…
Gov. J.B. Pritzker signs $50.4 billion state budget but vetoes legislators’ pay hike that exceeded state limit
Sun-Times…
Pritzker signs $50.4 billion budget that boosts early education funding — and stops state officials’ raises from breaking the law
WCIA…
Pritzker signs state budget, scales back lawmaker pay raises
SJ-R…
Pritzker signs $50.4 billion budget, championing investments in education
Raises to lawmakers reduced with governor’s amendment
Patch…
Lawmakers To Receive 5 Percent Pay Raise After Gov. Pritzker Signs Largest State Budget Ever […]
The budget will also include another pay raise for Illinois lawmakers. The annual cost of living increase for state lawmakers is capped at 5% or the rate of inflation, whichever is lower. The increase in pay was set for legislators at 5.5% but was vetoed by Pritzker and brought down to a 5% increase due to the cap on the COLA’s.
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Open thread
Thursday, Jun 8, 2023 - Posted by Isabel Miller
* What’s going on in your part of Illinois?…
7 Comments
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Isabel’s morning briefing
Thursday, Jun 8, 2023 - Posted by Isabel Miller
* Here you go…
* Sun-Times | Pritzker signs $50.4 billion budget that boosts early education funding — and stops state officials’ raises from breaking the law: The governor’s office said line-item reductions of $192,700 were made after a review found that cost-of-living pay raises granted to constitutional officers, legislators and some appointed officials exceeded 5%, which they said was unconstitutional.
* Tribune | Gov. J.B. Pritzker signs $50.4 billion state budget but vetoes legislators’ pay hike that exceeded state limit: The change on salaries made by Pritzker, which takes effect unless lawmakers vote to override them, marks the second time in three years the governor has had to make technical fixes to the budget sent to him by lawmakers.
* ABC Chicago | Governor JB Pritzker signs $50B state budget: The governor signed it into law at Christopher House, a Pre-K through eighth grade nonprofit school, to highlight, among many aspects of the budget, the money the state is investing in early childhood development.
* Tribune | Ex-state Sen. Terry Link testifies about his turn as a government mole in federal bribery trial of Berrios son-in-law: Link’s appearance in a federal courtroom took on an added spectacle since the Vernon Hills Democrat had vehemently denied reports — including in the Tribune — that he was the cooperating state Senator A mentioned in the charges first made public in October 2019.
* Sun-Times | Former state Sen. Terry Link testifies about his cooperation with FBI — which he once denied: The first day of testimony in Weiss’ trial also featured appearances by state Rep. Robert “Bob” Rita and former state Sen. Antonio “Tony” Munoz. For Rita, it was his second time testifying in federal court in less than three months about bribery schemes at the Illinois Capitol. But only Link had to explain his own crimes to the jury. The former senator told the panel that he’d withdrawn money from his campaign account and, he said, “I used some for gambling.”
* Crain’s | Pritzker makes personal pitch as EV battery makers near decision on Illinois plants: Reliable sources say Pritzker has talked to — or in the next few days intends to talk to — at least three companies that have done site visits: one reportedly European based, the second Chinese and the third of unknown origin.
* NBC Chicago | Bears CEO Kevin Warren and Chicago Mayor Brandon Johnson issue statement as team explores options: “Today we met and discussed our shared values and commitment to the city of Chicago, the importance of deep roots and the need for equitable community investment throughout the city,” the statement read. “We are both committed to the idea that the city and its major civic institutions must grow and evolve together to meet the needs of the future. We look forward to continuing the dialogue around these shared values.”
* WTTW | Mayor Brandon Johnson ‘Looking Forward’ to Continuing Work with CPS CEO Pedro Martinez: Johnson called out Martinez and other education leaders during his inauguration speech last month, saying: “I need you. We can do this together.” If Martinez remains in his position into next year, he’ll be tasked with negotiating a new labor agreement with the CTU, whose current deal is set to expire in 2024.
* Illinois Answers | A Popular Affordable Housing Initiative Is Ripe For Expansion in Chicago — But When?: The Additional Dwelling Unit (ADU) program has led to the construction of nearly 500 relatively affordable new homes since May 2021, mostly on the city’s North and Northwest sides — two of five “pilot zones” where the program has been rolled out. But advocates say that only represents a sliver of its potential, arguing city leaders need to put more money behind the program.
* Tribune | Wisconsin Republicans block meningitis vaccine requirement for students: The Legislature’s vote also makes it easier for parents to get an exemption from a chicken pox vaccine requirement that is in place for all K-6 students. Evers’ administration wanted to require parents seeking a chicken pox vaccination exemption to provide proof that their child has previously been infected.
* Sun-Times | Chicago Blues Festival to kick off full force after pandemic cancellations, constraints: After three years of pandemic blues, the Chicago Blues Festival is back in full force, and the free, four-day star-studded affair kicks off Thursday in Millennium Park with hometown hero Wayne Baker Brooks. “Words can’t express the way I’m feeling about it. Music is how I get my emotions across,” said Brooks, who leans into a bit of advice the late blues legend Albert King passed along when Brooks was 19 and trying to decide between playing drums and guitar.
* Scott Holland | Do we really need to ponder a new state flag?: Illinoisans understand how a flawless flag design becomes a ubiquitous, pride-inspiring pennant because Chicago’s is one of the best anywhere. NAVA should consider adding additional principles for flag design: must look cool as a tattoo, as a patch for city workers and vehicles, or easily blended into sports logos and uniforms.
* Sun-Times | Chicago area air quality improving, but wildfire effects may linger a few days: The air in Chicago isn’t colored in a hazy dystopian orange like some parts of the East Coast, but wildfires raging in Canada may continue to affect air quality in the city and across Illinois for the next several days.
* Tribune | 3 severed heads from donor bodies left at employee’s desk after complaints raised about alleged misconduct: Wheatley said the heads from AGA donors were placed next to his desk after he reported concerns about the mishandling and poor conditions of donated bodies to his supervisors. But AGA Executive Vice President William O’Connor denied any maltreatment accusations, saying that handling body parts is in Wheatley’s job description.
12 Comments
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Live coverage
Thursday, Jun 8, 2023 - Posted by Isabel Miller
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