The Board of Trustees at Chicago State University took steps at a special meeting today to officially declare financial exigency and prepare the University to continue operating in the absence of state funding. Like all public universities, CSU enters its eighth month with no funding due to the historic state budget impasse.
“The actions taken by the Board today are meant to give the administration of the University some additional flexibility as it works through this unprecedented situation,” Anthony Young, Chairman of the Board of Trustees said. “Over the past year, this University has made significant cuts to personnel and spending but has reached a tipping point where the ability to function is threatened. I want to be very clear, this action may help the administration manage this crisis in the short term, but exigency is by no means a solution to our budget woes. The only real solution is for the Governor and the leaders to come together and provide the necessary funding to avoid further damage to our universities.”
In declaring financial exigency, the Board is officially recognizing that the unforeseen fiscal situation compels CSU to reevaluate all programs, services and organizational structures in order to fulfill its core mission and to complete the current semester. In addition to declaring exigency, the Board established a Management Action Committee, which is chaired by the President of the University and includes senior members of the administration, who will continue the ongoing task of thoroughly reviewing all aspects of University spending and make recommendations on where additional cost saving measurers can be found. Lastly, the Board created an Advisory Committee, which will have faculty, staff and student representation and will give input to the Management Action Committee.
“We find ourselves in this unprecedented situation because, while the state has not honored its commitment to our students, we still intend to do so,” Thomas Calhoun Jr., CSU President said. “We are committed to finishing this semester and to graduating our seniors, and in order to accomplish that goal in the absence of state dollars or MAP grant funding, we are forced to take these extraordinary measures. I would hope the necessary but unfortunate steps we are taking here today will help all elected officials who represent public universities and care about higher education recognize that this is not just a Chicago State problem, it can and will affect the entire public university system. On behalf of our students who have bravely and proudly stood at the front lines of this crisis and fought for their university, I once again call on the Governor and the leaders of Illinois to put aside your political differences and take necessary action to prevent students from being the victims of this catastrophe.”
* Meanwhile…
February 4, 2016
To: The Honorable Governor Rauner
Senate President Cullerton
Senate Minority Leader Radogno
House Speaker Madigan
House Minority Leader Durkin
Members of the General Assembly
I am writing on behalf of the Higher Learning Commission (HLC), the regional accrediting agency for nineteen states, including Illinois. HLC is recognized by the United States Department of Education to assure quality in higher education and to serve as the gatekeeper to federal financial aid for students in our region.
As your role in Illinois includes consequential decisions regarding the governance and funding for colleges and universities, I am notifying you of the potential accreditation outcomes that may result from not approving a budget that will provide funding to Illinois colleges and universities and their students.
A criterion for accreditation is demonstration of the availability of financial, physical, and human resources necessary to provide quality higher education. HLC is aware that the colleges and universities in Illinois may need to suspend operations because financial resources from the state are not available. HLC is obligated to move swiftly to protect Illinois students and to ensure the quality of the colleges and universities they attend.
Following federal regulations, HLC has notified all Illinois colleges and universities that if they believe they will have to suspend operations or close in the next several months, they must provide HLC with a plan for how students can continue at another college or university to avoid eliminating their access to higher education. For students to continue at another institution, it could mean having to transfer to private universities or leave the state. It is also probable some students may drop out of college. The plan also must explain how students will be informed about this urgent situation, including how they access transcripts if operations have been suspended due to lack of state funding.
HLC’s analysis of that plan about the college or university’s viability in the weeks ahead could result in 1) a review of the college or university’s compliance with HLC’s Criteria for Accreditation, 2) a sanction – in which the college or university would have two years or fewer to demonstrate corrective action, or 3) withdrawal of accreditation. After such a withdrawal, there is a multi-year process for institutions to regain status with an accrediting agency. Students attending institutions that do not have status with an accrediting agency recognized by the federal government cannot access federal financial aid.
I served as a college president at two institutions in Ohio and know it is critical for state leadership to have every fact and potential outcome available. The lack of state funding is putting Illinois colleges and universities at serious risk and jeopardizing the future of students. I recognize the pain of budget shortfalls, especially in our home state of Illinois. The economic challenges the state faces are significant, and difficult decisions undoubtedly must be made. I am writing because I believe it is important for you to have all the relevant information before making the tough decisions that fall to your positions.
As you struggle with these difficult and life-changing decisions, if you have questions about the role of accreditation, please contact me.
Sincerely,
Barbara Gellman-Danley, Ph.D.
President, Higher Learning Commission
Emphasis in original.
…Adding… From the IBHE…
Statement from Dr. James Applegate, Executive Director
“The IBHE has been informed by Chicago State University that the Board of Trustees have declared financial exigency. They are taking steps to mitigate the financial situation on their campus in order to address the needs of their students, faculty, and staff.
The Board of Higher Education is keenly aware of the uncertainty the lack of a Fiscal Year 2016 budget is creating for Illinois college students, professors and staff at all of Illinois’ 48 community colleges and twelve public universities.
While IBHE has no direct role or authority in overseeing the actions of the CSU Trustees, we extend our support to the campus leaders as they seek to minimize the impact on their students’ academic progress.”
* Jonathan Kaye is a Republican candidate for the Illinois House running against incumbent GOP Rep. Reggie Phillips. Kaye hammered Phillips the other day for missing a vote on higher education funding, but that’s not what this post is about.
What I’d like you to do is read something that Kaye wrote about himself. Yes, it’s long, but it’s utterly fascinating. Kaye has lived a remarkably interesting life. And he wrote his story at a time when he was apparently being attacked by Rep. Phillips for his arrest record, which he explains as well.
I doubt that he has much of a shot in this campaign. He hasn’t raised much money. And he’s up against a super-conservative incumbent in a super-conservative area.
* Earlier this week, Democratic state Sen. Daniel Biss wrote an op-ed for Crain’s…
We need to look to economically successful states—Massachusetts, Minnesota and others—that have similar values and political traditions as ours in Illinois… If we sit down, work together and study these examples, I am confident the General Assembly and Gov. Rauner can come together to craft a reform agenda that puts Illinois on a path to fiscal stability and enhanced economic vitality.
I found these words very enlightening, as the governor and Republicans in Illinois agree with Massachusetts and the reforms they have made. I am left wondering why Democrats in Illinois cannot agree with Democrats in Massachusetts.
In 2011, Massachusetts Gov. Deval Patrick signed legislation that gave cities in his state greater collective bargaining flexibility in crafting more affordable health insurance packages for government workers. More than $200 million has been saved by this act—an act taken by a Democratic governor in a Democratic state.
Gov. Bruce Rauner’s proposal seeks to also give units of local government in Illinois the same abilities that Democrats in Massachusetts gave to their towns. Republicans in the General Assembly agree; Democrats in the General Assembly refuse to consider it.
Massachusetts property owners currently pay half the taxes that Illinois property owners pay. The governor’s proposal to deliver a property tax freeze with tools to control costs at the local level will help bend the curve toward lower property taxes across the state. Republicans in the General Assembly agree; Democrats refuse to consider it.
Finally, Massachusetts has the fourth lowest workers’ compensation costs in the nation. Even in such a liberal state, their workers’ compensation system is more competitive—in part because they have adopted reforms that ensure employers don’t have to pay for injuries that aren’t primarily work related. Gov. Rauner has proposed similar reforms in his workers’ compensation proposals. Republicans in the General Assembly agree; Democrats refuse to consider it.
Sen. Biss and members of his party refuse to negotiate on reforms that could save Illinois taxpayers hundreds of millions of dollars a year. Yet they continue to defend the failed status quo that has held Illinois back from making the same achievements that deep blue Massachusetts has achieved. As you read this, do you know what the Democrats’ plan is to turn Illinois around, other than raising taxes again?
The part about collective bargaining at the local level is only a fraction of what Gov. Rauner is pushing. If it was the only thing, it might’ve had a chance.
Also, we looked at the Massachusetts workers’ comp system yesterday.
The Rauner Administration’s latest misleading missive is full of falsehoods and clearly intended to divide and distract state employees at the same time the members of AFSCME’s rank-and-file bargaining committee are holding informational meetings with their co-workers statewide. Already thousands of union members have attended those meetings to get the true facts from their representatives on the bargaining committee, not Bruce Rauner’s political spin.
A year later, the governor is still demanding that public-service workers in state government such as child protection investigators, disability caregivers and emergency responders get zero pay increase for four years while paying double their current costs to keep their health care. No other union has agreed to these demands for both a pay freeze and a huge hike in employee health costs.
Rauner’s also pushing a program of selective bonuses where bosses could reward a chosen few employees based on unknown criteria, opening the door to cronyism and favoritism. He wants a blank check to contract out public services for private profit, insisting on eliminating basic safeguards that prevent irresponsible privatization. And rather than do the hard work of finding compromise, he’s walked away from the table and asked for the power to impose his own demands. That’s a recipe for the kind of conflict that candidate Rauner boasted he would cause.
State workers want a compromise that’s fair to all, and we believe that’s what the people of Illinois deserve—not a governor unwilling to modify his my-way-or-no-way demands.
* From an e-mail that was forwarded to me by a labor lobbyist…
Wanted to make sure everyone has this as we prepare to testify in the capitol and speak before other groups this year. Governor Rauner and his friends like to say that businesses are leaving Illinois.
I ran this report from the Bureau of Labor Statistics web site. It tracks the number of employers (both public and private sector) in Illinois. As you can see, the number of employers in Illinois has grown in every quarter since the first quarter of 2003.
Thank you.
Jason Keller
Illinois AFL-CIO
Legislative Director
That’s a 33 percent increase in employers since the first quarter of 2003.
* But what about other states? I asked the lobster to see if he could get Keller to run more numbers and was forwarded this e-mail today…
After I sent the email yesterday regarding the number of employers in Illinois, I was asked by several people how Illinois compares to other states in terms of growth of businesses. I updated the chart (see attached) with the number of business establishments in every state from 2001-2015. Since the first quarter of 2003, when Governor Blagojevich took office and Senate President Emil Jones, Jr. gained control of the State Senate (which is when we first heard the complaint that Illinois was a bad place to do business). I specifically looked at growth in each quarter. This is what I found:
Illinois has seen growth in the number of businesses in the state for approximately 49 consecutive quarters (and hopefully will still continue to increase). 2003-2015. NO OTHER STATE CAN MATCH THAT STEADY AND SUSTAINED GROWTH. None. This means that since 2003, Illinois has not lost one net business (contrary to what we hear from Republicans). Other people may play with the numbers and see other states have a larger percentage growth, but no one can point to such a long term sustained growth of businesses. Illinois weathered the Great Recession without losing growth. North Dakota and Texas come close with the oil and fracking growth – but they still saw a drop in businesses in several quarters. As a reminder, during these years, Illinois labor was successful in passing:
· Minimum wage increases that became effective in 2004, 2007, 2008, 2009, and 2010 – and still businesses grew.
· Numerous times prevailing wage laws were strengthened – and still businesses grew.
· Effective in 2008, employee misclassification law was passed – and still businesses grew.
· Three times in the past 11 years, the workers’ compensation law has been changed – and businesses grew.
· The unemployment insurance law was changed multiple times, through the agreed bill process – and businesses grew.
· Card check for public employees organizing passed in 2003 (PA 93-444) – and businesses still grew.
· Equal Pay Act passed in 2003 (PA 93-0006) – and businesses grew.
· Corporate Accountability passed (PA 93-552) – and businesses still grew.
There were other laws passed, but this gives you a snap shot.
For background, I spoke with an economist at the Bureau of Labor Statistics – the measure of “number of establishments” is the most accurate way to count the number of businesses in the state.
Thank you.
Jason Keller
Illinois AFL-CIO
Legislative Director
The number of Texas business establishments grew by about 27 percent since that first quarter of 2003. Indiana’s grew by just 4 percent.
* Keep in mind that these numbers include both public and private sector establishments. Even so, it’s something that deserves more attention and investigation.
*** UPDATE *** From the Illinois Policy Institute…
Rich,
We took a quick look at the same survey (QCEW) and same timeline (Q1 2003 - Q2 2015) as in the study you posted. Attached are the rankings.
For 2003-2015 growth, Illinois’ growth ranks 4th for establishments, 43rd for jobs, and 42nd for average weekly wage (AWW).
It’s important to note that the combined weak jobs growth and weak average weekly wage growth is a double whammy. Imagine adding 500,000 new jobs, all paying at the average weekly wage. Great news, right? That would bump up the jobs number and even though it wouldn’t bump up the wage number, we’d all cheer it.
In Illinois’ case, both job growth and average wage growth were bad. So not only is job growth weak, the average wage has grown slowly on that slow-growing job base.
The 2003-2015 timeline included the recession right in the middle. So we also looked at the same data set on the recession recovery timeline, starting from Q1 2010 when everyone had basically bottomed out (after various degrees of collapse, Illinois’ fall ranked among the worst).
For growth over that recovery time period, Illinois’ ranked 4th for establishments, 32nd for jobs, and 45th for average weekly wage (AWW).
* The Tribune writes about Gov. Rauner’s executive order yesterday forming a new privatized economic development agency. Rauner opposed legislation last year which would’ve sunsetted his agency in three years…
“The biggest difference is this isn’t going to die in three years,” Rauner said. “It can’t be subject to the political games the legislature is attempting to play with this.”
That’s not necessarily true. Because Rauner established the arrangement by executive order, the next governor could reverse it. Rauner is up for re-election in 2018.
* The governor also claimed that the executive order made sure the agency would be subjected to FOIA…
In his remarks, Rauner said ILBEDC would be subject to same Freedom of Information Act requirements to turn over documents and records when requested. But DCEO director Jim Schultz seemed to contradict Rauner’s statements after the speech.
“The executive order does not require that,” Schultz said when asked if the corporation was subject to FOIA requests. “We’re going to post all of our board minutes. Any grants or tax incentives that we negotiate will be posted online. So effectively, addressing the FOIA would be subject to audit. We’re going to post all the…donations and what they’ve made to corporations, so it’s effectively going to be the equivalent of FOIA without the requirements of FOIA.”
Transparency with this kind of public-private partnership has been an issue with Democratic state lawmakers.
“Our main concern has been that public accountability follow public dollars,” said John Patterson, spokesman for Senate President John Cullerton. “We hope the governor shares that as a priority if he is moving forward on his own.”
“President Obama has come out strongly in favor of both term limits and redistricting reform,” Rauner said, seemingly without equivocation — which raised some eyebrows. […]
But back to Rauner’s claim that he and President Barack Obama are of like mind when it comes to redistricting. It’s not like Obama endorsed the governor’s plan. Still, the President’s sentiment on the topic, at least, was pretty clear.
When though, I wondered, did Obama talk about term limits? Nothing came to mind, and a Google search didn’t easily come up with anything definitive. […]
[The governor’s press staff] pointed me to a speech the President gave last June, before a conference of African nations.
Rauner’s office points out that during it, Obama said “nobody should be president for life,” and “your country is better off if you have new blood and new ideas. I’m still a pretty young man, but I know that somebody with new energy and new insights will be good for my country. It will be good for yours, too, in some cases.
“Yes, in our world, old thinking can be a stubborn thing,” Obama said before the African Union. “That’s one of the reasons why we need term limits — old people think old ways.” […]
Say what you will about Madigan’s power, he’s no dictator. Obama was speaking about the need for presidential term limits in a continent whose people have suffered under brutal dictatorships — regimes ruled by blood and war.
* The News-Gazette editorializes about President Obama’s upcoming address to the General Assembly…
In his recent State of the Union address, Obama called for an end to partisan map-drawing in congressional races. Why not the same prescription for legislative races in his home state?
Rauner has been pushing legislators for redistricting reform. But Democratic House Speaker Michael Madigan is adamantly opposed so the proposal is a nonstarter in the Legislature.
Still, Obama’s support could boost efforts by groups that are working to put the independent maps issue on the November 2016 ballot in the form of a state constitutional amendment.
The presidential bully pulpit is an imposing platform. Obama should use it to, among other things, help restore electoral energy to the state’s now-fraudulent process of electing the people’s representatives to the General Assembly.
* The Question: What should President Obama say during his speech?
This is a serous question, so no snark and keep your drive-by national political talking points to yourself. Thanks.
* Look past Rep. Kelly Cassidy’s rhetoric here for the actual news…
Nearly five months ago, House Leadership provided members with a survey asking for us to prioritize items that remain unfunded. I released a survey reflecting the choices, and set the rankings to reflect the responses. Since then, we have passed a handful of bills funding portions of programs but have made no progress towards a comprehensive solution. We have seen numerous non-profit organizations go under, and services for tens of thousands have ended. The unfunded line items represent hostages in this budget standoff, and they are beginning to fall. Meanwhile, in spite of making significant progress on unpaid bills since 2012, from $6.8 billion to $4.3 billion, we are now seeing that pile of bills growing to record levels, projected to reach $10-$12 billion.
We have once again been asked to identify priorities for unfunded items, choosing 10 out of a total of 58, many of which are matters of life and death. Pitting critically needed services and programs against each other in a budgetary “hunger games” is repulsive.
There is only one rational and moral choice: getting the revenue needed to stabilize government and provide services that are fundamental to the well being of tens of thousands of Illinoisans. There is no correct order of priorities, because there are life and death consequences. Any choice but appropriate revenue is morally reprehensible and will continue to lead to suffering.
I reject the notion that we can only prioritize a small number of these programs, and instead invite my colleagues to join me in demanding we stop talking about what essential line items to fund, and instead talk about how we are going to fund them.
The fact that we are having this discussion represents the utter lack of morality of our budget situation. Putting aside the fact that our outlined priorities may very well not be funded in the near future, the choices given are hardly choices at all. How does one decide which order to prioritize funding for sexual assault victim services or the developmentally disabled? All sides of the budget standoff agree that revenue is an absolutely necessary part of the solution. With billions of dollars in unpaid bills and the collapse of our social safety net, the harm is unacceptable. I strongly support returning the tax rate to the previous levels, and working towards a progressive income tax. Until then, we are tasked with trying to prioritize a few of the many services that impact the lives of tens of thousands in in our state.
That said, if there is to be another stopgap funding initiative in the near future, there is an opportunity to offer input. Once again, I am asking my constituents to share their priorities, and their experiences, to help drive us towards a more comprehensive solution. I recognize that, like me, many of you will choose to rank revenue as priorities 1-10. For those of you specifically impacted by program cuts, please use the narrative area of the survey to share your story so that I can better illustrate the real world impact of this impasse. I have met with and spoken to so many people either already feeling the loss of services or living in fear of losing their independence as a result of looming cuts. Know that I will continue to push forward towards a solution that protects working families and the most vulnerable people we serve.
Due to the timeframe given by leadership, we need your responses by 3pm on Friday, February 5th.
I saw that you posted the newest priority ranking list given to members. It is notable that there are items left off the list, as one commenter said.
More notable, though, is how much this list has changed and grown from previous member polls.
Items like Teen Reach (which the Governor completely eliminated in his budget proposal last year) were not even included in previous member polls. But children, families and communities have made it so clear how vital afterschool programs are that it has emerged as a priority.
Programs don’t show up on a list by accident. These are obviously issues members across the state are hearing a lot about from constituents, advocates and the local press. It goes to reason that, in turn, the Governor’s office is getting a fair amount of grief from lawmakers who know the anger present in their communities, and want to be able to deliver some good news ASAP.
We’ll see in a few weeks during his budget address if, given the clear support these services have from families across Illinois, the governor will directly address how he’d like to see these services get funded now and in the future.
Emily Miller
Policy and Advocacy Director, Voices for Illinois Children
Co-Coordinator, Responsible Budget Coalition
* As we’ve already discussed, Gov. Bruce Rauner’s Turnaround Illinois PAC transferred $1.818 million to Dan Proft’s Liberty Princples PAC last month. Proft then spent hundreds of thousands on TV ads to bolster Sen. Sam McCann’s Republican primary opponent. McCann voted against Rauner on AFSCME’s “no strike” bill and even contemplated running for governor against Rauner as an independent in 2014.
Anyway, Bernie writes today about an endorsement of McCann’s GOP opponent Bryce Benton by the staunchly pro-life Family PAC…
McCann is also very conservative on social issues, including abortion. Caprio, in his group’s full endorsement statement, commended McCann for such views, but added that “we are deeply concerned with the extensive support which he is receiving from many public employee unions” that are “standing in the way of true reform in Illinois state government.”
Caprio’s Family PAC had less than $1,400 on hand as Dec. 31. It did catch my eye that RICHARD UIHLEIN of Lake Forest donated $10,000 to the committee on Jan. 13. Uihlein has also contributed more than $2.6 million to Rauner and more than $5 million to Chicago radio personality DAN PROFT’s Liberty Principles PAC since 2012, and Proft’s group is backing Benton with TV ads and other help all worth more than $325,000 so far.
Caprio said Uihlein has been a consistent support of Family PAC, and the recent donation had nothing to do with the group’s decision to back Benton. A quick check showed the Uihlein did give the group more than $10,000 each of the past two Februaries.
Bourne’s campaign manager is CASEY CONSTANT, 25, of Sherman, who worked on the Rauner campaign and is on leave from his $70,000 state job as intergovernmental affairs manager for the governor. His state job was paid for by the Department of Children and Family Services.
* Adding highway lanes doesn’t usually reduce congestion. Instead, adding capacity tends to attract more traffic, but that’s good for creating business opportunities, especially in a congested trucking corridor like this one.
Press release…
Gov. Bruce Rauner today was joined by legislative leaders and local elected officials to announce a legislative resolution that would allow the Illinois Department of Transportation (IDOT) to pursue adding managed lanes to Interstate 55 under a private-public partnership. By seeking out a P3 agreement, the state could deliver the project benefits more quickly and at a reduced cost.
“By using existing resources to leverage private investment, we can build the type of infrastructure that allows Illinois to better compete in the 21st century,” Gov. Rauner said. “This is an innovative project that will create jobs, improve the region’s quality of life and show that Illinois is open for business.”
The I-55 managed lanes project would add at least one lane in each direction to a critical travel corridor between Interstate 355 (Veterans Memorial Tollway) and Interstate 90/94 (Dan Ryan Expressway). The 25-mile section accommodates 170,000 vehicles a day, but suffers from long, unreliable travel times, resulting in frustrating commutes for workers and increased costs for the delivery of goods and services.
Options for the additional lanes currently being explored include tolled and untolled carpool lanes and express tolling lanes. The state will complete the federal environmental studies later this year to identify the preferred option.
A 2011 state law allows IDOT to build, finance, operate, and maintain highway projects using public-private partnerships, as long as the General Assembly adopts a resolution in support of the project. That law is modeled on best practices from across the country and includes opportunities for public hearings and input. The resolution introduced today would allow IDOT to further explore a P3 for the I-55 project and commence the procurement process. While managed lanes have been successful in other states as P3s, the I-55 project would be a first for Illinois.
“Managed lanes are truly an expressway within an expressway – one more option that will make travel more convenient for everyone who uses I-55,” said Illinois Transportation Secretary Randy Blankenhorn. “This project signals a new way of doing business at IDOT and a model for improvements throughout our system.”
“Regardless of the time of day, there is congestion along the Stevenson Expressway. Not only is it a source of regular frustration for drivers, including myself, it can be a dangerous situation for both motorist and passengers,” said House Republican Leader Jim Durkin. “What we are proposing today would give IDOT leeway to further explore the possibility of using private funds to keep the I-55 Congestion Relief Project alive and moving forward.”
“Relieving the congestion on this stretch of I-55 must be a priority for the state of Illinois,” said Senate Republican Leader Christine Radogno. “However, we must also recognize the state must be creative in addressing our transportation challenges. This is an innovative approach that has been successful in other states and should be explored here.”
“This region has seen explosive growth in the past decade, but that has increased traffic on the Stevenson,” said Sen. Martin Sandoval, Chairman of the Senate Transportation Committee. “Allowing IDOT to explore a public-private partnership will be a win for taxpayers and drivers. I stand with Governor Rauner to find new ways to relieve congestion on this important corridor for Illinois.”
Using a P3 on this project could save taxpayers an estimated $425 million in construction costs. Possible toll revenues from the project and P3 financing sources would be available to pay for construction, operation, and maintenance costs. Construction could start as early as next year and wrap up in 2019.
It’s good to see the governor holding a bipartisan press conference for a change. And one of Sen. Sandoval’s two House members is none other than House Speaker Michael Madigan. Hopefully, that’s a positive sign.
Last July, Munger’s office had estimated that without a budget, the spending deficit would reach about $5 billion by the end of fiscal year 2016. But spending at the state Department of Human Services and the Department of Healthcare and Family Services — controlled, in the absence of a budget, by court orders and consent decrees — is now expected to add an additional $1.2 billion to the projected $5 billion deficit. […]
And as the backlog continues to grow and bills go unpaid, everything from social service agencies to state universities and colleges suffer, Munger said, echoing a familiar refrain.
Munger said the state could raise taxes, but suggested doing that alone would be political suicide.
“If we solve this problem on revenue alone, we will be looking at raising our tax rate in Illinois 3.75 percent up to somewhere between 7 and 8 percent,” Munger said. “I don’t know any legislator who would vote for that and I don’t know many businesses that would stay in Illinois for that.”
That’s true. But the huge tax hike she’s talking about assumes the state will attempt to get out of this hole all at once.
It’s not going to happen that way because, as Munger herself said, who could possibly vote for it?
* Instead, once taxes are raised, the government could very well pay down that backlog over time, just like Pat Quinn did after he and the Democratic GA raised taxes. The state dragged a mountain of debt behind it for years, gradually whittling it away until most of the tax hike expired. Such a strategy could very be used again.
There are two other options that could be in the mix as well, however.
1) The government could do massive “sweeps” from special state funds to pay down the backlog. Quinn only wanted to borrow from special funds, but Rauner is fine with just taking the money.
But unless you dip into the Road Fund and municipal revenue sharing (sacrosanct funds, but where the real money is), you can’t solve that problem. Taking money from the munis means harming Chicago, so that’s out. They swept the Road Fund last year to patch the FY15 hole, and the road builders (who backed Rauner) went kinda nuts. As a result, the latest GOP fund sweep plan specifically protects the Road Fund from being dinged.
2) Since state bankruptcy is not an option, the government could require businesses and not-for-profit groups to forgive part or even all of the debt owed by the state in exchange for new contracts. That would be the “businessman” way out of this deep hole, but it could do serious damage to some businesses and not-for-profits or even put them entirely out of commission.
Imagine being told by the state: “Yeah, we owe you $6 million, but if you don’t forgive that debt we’re not giving you any more contracts and that’ll put you out of business.”
* Related…
* Children, families, providers sort through ‘devastating’ cuts in autism-related services: Families of Illinois children with autism are reporting declines in their children’s communication skills and heightened anxiety after the ongoing lack of a state budget prompted drastic reductions in services statewide… Beginning last summer and fall, Autism Program providers began cutting back on services to people without insurance coverage or those who couldn’t pay the full price. Medicaid doesn’t pay for many autism-related services or reimburses providers at low rates.
* Sangamon County’s Habitat home-building program on indefinite hold: Habitat for Humanity of Sangamon County has suspended its affordable-housing construction program indefinitely as a result of a sharp drop in donations that organization leaders say is linked to the state budget deadlock… Stone said longtime donors of money and materials have described their own cash crunch as a result of delayed state payments and lost contracts. She added that she believes state workers have turned cautious out of concern for their jobs as Illinois enters its eighth month without a budget… “The companies that are so generous, the ones that depend on state funding, they don’t have the cash,” said Stone, “or they don’t have new (state) contracts. There are very generous companies in Springfield, but we were getting the same pushback from most of them.
* He did such a great job owning the Sun-Times that his can’t-miss business acumen is now in dire need at the Tribune…
Michael W. Ferro Jr., the majority owner of the Chicago Sun-Times’ parent company, has significantly expanded his media holdings without straying far from home.
In an unusual transaction, a company led by Ferro has bought a 19.9 percent stake in Sun-Times’ rival Tribune Publishing for $44.4 million, a move that will make his firm Tribune’s single-largest shareholder and shift his office out of the Sun-Times building.
Ferro, 49, will become non-executive chairman of Tribune, the publicly traded company whose publications include the Chicago Tribune, Los Angeles Times and nine other daily newspapers. […]
Ferro will retain his majority investment stake in Wrapports, the Sun-Times’ parent company. But he will step down as Wrapports’ chairman and cede all control of the Sun-Times and affiliated companies, including the Chicago Reader and Aggrego, a national network of online-only publications. The Chicago Tribune and Sun-Times will continue to operate independently.
Good news for Sun-Times employees, not so great for Tribune workers.
House Speaker Michael J. Madigan, D-Chicago, issued the following statement Thursday announcing hearings to be held by the bipartisan Education Funding Task Force throughout the spring to help craft a legislative plan to equitably fund education throughout Illinois:
“Senate President Cullerton has shown strong leadership on the issue of fair and equitable education funding, which is so important to every community across our state. The President’s commitment to fairly funding our schools and helping all students meet their full potential is one that I share, and I plan to work with him to achieve this goal while making sure that voices from across our state are heard and that all schools and programs are protected throughout this process.
“Beginning February 16 and continuing throughout the spring, House Majority Leader Barbara Flynn Currie will lead hearings of the bipartisan Education Funding Task Force. The House Democratic members of the task force, who represent Chicago, suburban areas and downstate, bring to the discussion the views and concerns of residents from all across Illinois to help ensure a comprehensive approach to any changes in how our schools are funded. The task force will hear input from educators and advocates from throughout the state, and will work with all interested parties to craft legislation aimed at ensuring all students in Illinois receive the excellent education they deserve.”
The Education Funding Task Force will convene Tuesday, Feb. 16 at 10:30 a.m. in Room 114 of the State Capitol.
Rough translation: Thanks, John, but I’ll take it from here.
Several suburban Democrats aren’t exactly thrilled with the direction this topic has been going. As Senate GOP Leader Radogno pointed out the other day, the suburbs are mainly responsible for paying for the funding shift to lower-income schools as it stands right now.
The president’s commitment to fairly funding our schools and helping all students meet their full potential is one that I share, and I plan to work with him to achieve this goal while making sure that voices from across our state are heard and that all schools and programs are protected,” Madigan added. […]
Steve Brown, Madigan’s spokesman, suggested in a follow-up conversation that protecting “all schools and programs” means that no district would get less than they do now.
“You’re very unlikely to pass a bill that will cost districts money,” Brown said. That means the state would have to come up with potentially hundreds of millions of dollars a year more, and, “You need a source. . . .You don’t know the price tag now.”
* It’s easy to believe that the “conventional wisdom” about the Chicago Teachers Union expressed through the mainstream media (and here) accurately reflects the prevailing thought in the city.
But when you pit the CTU against Mayor Rahm Emanuel, Chicagoans have been picking the union’s side for years. It’s a very big reason why Mayor Daley tried to avoid confrontations with the teachers. It’s why Emanuel “lost” the teachers strike. It’s also something that Gov. Rauner has never really understood, going back decades.
Three times as many Chicagoans side with the teachers union as with Mayor Rahm Emanuel on how to improve public schools at a time when the two sides remain locked in contentious contract negotiations, a Chicago Tribune poll has found.
In households with CPS students, 73 percent supported the teachers union while 14 percent backed Emanuel. In homes without CPS students, 57 percent sided with the CTU compared with 22 percent with Emanuel. […]
The poll also found that support for the teachers union declined the higher the income of the poll respondent. Teachers received support from 70 percent of those who made less than $50,000, but that support dropped to 50 percent among those with incomes over $100,000. Still, only 29 percent of those with the higher incomes supported Emanuel. […]
A higher percentage of white voters backed Emanuel, 35 percent, but more of them still sided with the teachers union, 42 percent. Among Hispanics, 66 percent favored the teachers union and 13 percent supported Emanuel.
* The governor again called out Downstate and suburban Democratic legislators yesterday. Sun-Times…
Rauner argued that a bill allowing the state to take over CPS is not “dead on arrival” in Springfield simply because it would need approval from a Legislature dominated by Democrats.
“When the time comes, many Democratic legislators are not from Chicago, they’re from the suburbs . . . and you know what, when their voters understand what’s been going on and the subsidies that state taxpayers around Illinois have been funding CPS and now we can protect them from the mayor trying force off a half a billion dollars in liabilities on them, you watch,” Rauner said. “You’re going to see that that bill is not dead on arrival like some are trying to claim.”
* An e-mail from Rep. Stephanie Kifowit (D-Oswego)…
Hi Rich,
Just a quick followup. I caught the Governor’s press talk about CPS when he mentioned downstate and suburban legislators would be for the takeover of CPS. I’m not sure where he gets that from because as soon as he made mention, I have heard from residents the opposite. They don’t want the state to take over CPS, but they do want school funding change. Not sure where he gets that idea from.
Thanks,
Stephanie
We’ll see what happens if Rauner follows through with voter communication, warning people that their Democratic legislators are planning a half-billion-dollar Chicago schools “bailout.” Speaker Madigan, you may recall, used that exact same word last week to describe the governor’s takeover plan (even though Rauner’s plan bars more state money for the city). Rauner, however, has the cash to mail heavily to all districts, not just targets.
The city claims its schools are being shortchanged by the state. Others, particularly Senate Republican Leader Christine Radogno, have long argued that the numbers prove otherwise.
The crises at CPS would be manageable if Emanuel had only listened to him last year when he offered the mayor some advice, said Rauner, who is overseeing a financial crisis on the state level.
“The mayor rejected it, he said no to any structural reform. He said, ‘What I want you to do is just send half a billion cash and leave me alone.’ That’s not going to happen,” Rauner said.
Gov. Bruce Rauner on Monday repackaged a set of reforms he’s pushed since he took office in January, linking them — and an offer of help — to the financial crisis facing Chicago Public Schools.
The Republican’s attempt to rebrand his “reform agenda” was quickly shot down as “unacceptable” by Senate President John Cullerton, whom Rauner had singled out as a Democrat who has worked to compromise.
The proposal would freeze property taxes for two years and boost state funding to high-poverty school districts by $74 million. As part of the offering, Rauner said Illinois could immediately give $200 million in state aid to offset Chicago Public Schools’ pension costs but only as part of a comprehensive school reform package that includes allowing the city and local towns to opt out of collective-bargaining requirements.
According to a city spokeswoman, $665 million in [CPS] bonds maturing in 2044 were sold at a price of 8.5 percent, and $60 million in 2026 maturity securities at 7.75 percent.
The interest cost of borrowing that $665 million would be a tad under $1.081 billion, while the cost of borrowing that $60 million would be $26.41 million.
These are approximate numbers because I don’t have the exact number of months.
…Adding… The governor’s complete contract offer can be read by clicking here.
* The war of words continues…
Dear Colleagues,
As you know, on three separate occasions our CMS labor relations team negotiated and signed a Tolling Agreement with AFSCME leadership. The Tolling Agreement provided for a process, agreed to by AFSCME, that allows the parties to either agree that impasse in negotiations has been reached or, in the event one party does not agree, allows either party to ask the Illinois Labor Relations Board to decide if the parties are at an impasse-that is, the Labor Board would decide whether further negotiations between the parties would be worthwhile. On January 15, 2016, after weeks of no meaningful progress at the bargaining table, the Governor asked the Illinois Labor Relations Board to determine whether we are at an impasse in collective bargaining negotiations with AFSCME. In the weeks since, work in the State of Illinois has continued as usual. The Governor and the labor relations team at CMS are committed to respecting the Labor Board process, and we appreciate that members of AFSCME want to do the same.
There has, however, been a great deal of incorrect information circulated about our negotiation and proposals. We know that, in recent days, AFSCME has been conducting “informational sessions,” but we question how productive those sessions can be if AFSCME does not provide accurate information.
We cannot sit idly by without correcting the incorrect information being provided to AFSCME bargaining unit employees and the public. We have asked AFSCME to let you vote on our proposals, but we believe you must have accurate information to make a fully informed decision. As the State’s lead negotiator who sat across the table from Roberta Lynch and Mike Newman for the past year and explained the State’s proposals, I would like to take this opportunity to correct numerous incorrect statements. That information is enclosed.
Further, I believe that employees should not be satisfied with summaries and that they deserve a full picture. It is my understanding that AFSCME has failed to provide you with the State’s full proposal. I believe that is counter-productive. You should be able to read the State’s proposal in full, and determine for yourselves whether the State’s offer, which is substantially similar to those accepted by seventeen other unions, is fair and reasonable, particularly in light of the State’s fiscal condition. I am enclosing with this letter the actual language of the 2015-2019 collective bargaining agreement as proposed by the State in its last, best and final offer. That document shows all the changes proposed by the State from the contract that expired on June 30, 2015. You can now evaluate for yourselves the State’s complete proposal.
We have asked AFSCME to let you vote this proposal up or down. We hope you will ask AFSCME’s leadership to allow you to take such a vote. Seventeen other unions ratified similar terms and conditions by wide margins-often over 80% of state employees in those unions approved-and we think if provided a fair vote, this proposal will be approved as well. Thank you for giving it your consideration.
John Terranova
Deputy Director
CMS Office of Labor Relations
* And here’s his fact check…
Fact Check - Correcting Misinformation
Myth: The State’s proposal would give Illinois state workers the worst health insurance coverage in the nation.
Fact: False. In fact, we’re not even close. With retiree coverage included, Illinois pays nearly 3/4 of the total cost of coverage for its workers. In comparison, Indiana pays less than 45% of the total cost of coverage. Paying 100% of retiree premiums is a huge benefit to our workers-if current employees were responsible for those retiree healthcare premiums, they would need to be putting away $947/month now to cover that future benefit! Even if we only look at coverage for active employees-where the State is proposing to pay 60% of costs-the State’s proposal is still better than many other States and on par with the private sector.
Myth: The State’s current healthcare plans aren’t actually Platinum or luxury.
Fact: The average actuarial plan value (what federal regulations and insurance companies use to assess how rich a health plan is) for the State’s current plans is 92%. This means that out of every dollar in healthcare expenses, the insurance plan covers 92 cents and the employee pays 8 cents in deductibles, co-pays, and other such expenses. “Platinum” under the Affordable Care Act is defined as plans that are between 88 % and 92%. Platinum is the highest level under the Affordable Care Act-above Gold, Silver, and Bronze. And as mentioned, the State’s average plan value is 92%-the high end of Platinum.
Moreover, to be clear: under the State’s proposal, employees will have the option to continue this rich coverage at higher premiums, should they so choose. Alternatively, employees would have the option to have less-rich coverage and maintain current premiums. Employees will not have to both pay higher premiums and receive less-rich coverage.
Myth: The State’s proposal would wipe out all job security rights.
Fact: The State’s offer does not eliminate these rights. Layoffs would still happen in reverse seniority order. Employees would still have the opportunity to “bump” less senior individuals in the same position and qualifications. Employees would also still have the opportunity to transfer to other vacancies for which they are qualified.
Myth: If I have a major medical issue under the new insurance, there is no limit on what I could pay. I could go bankrupt!
Fact: The Affordable Care Act has an annual out-of-pocket maximum of $6,850 for an individual. While that’s a lot of money, it prevents people from being financially ruined due to a medical issue. You can go here to fact-check this for yourself: http://obamacarefacts.com/
health-insurance/out-of-pocket-maximum. The bottom line is no matter what coverage level employees select, there will be strict limits on how much each employee is going to be asked to pay in any given year.
Myth: Merit pay is just political pay.
Fact: Politics has nothing to do with it. In fact, the State would prohibit any Governor’s staff and appointees from being eligible for performance bonuses. The State has also proposed working with all unions to find fair, objective standards to measure performance. The program that’s now in place for Teamsters will give half of all their members a bonus. While we guaranteed that a minimum of 25% of members would receive a performance bonus (the same guarantee that we made in the Teamsters contract), that percentage is the floor, not the ceiling. In developing the program, the number could go up, just as it did for the Teamsters. And the total bonus payout would remain the same regardless of how many people receive a bonus, so the State doesn’t gain anything financially by giving it to fewer employees.
Myth: The Labor Board is biased in favor of the Administration.
Fact: A majority of the Labor Board was originally appointed by Governor Pat Quinn. Governor Rauner reappointed two individuals Governor Quinn had previously appointed or re-appointed. Significantly, all members of the Labor Board appointed or re-appointed since 2015 were confirmed by a supermajority-Democrat Senate. Furthermore, the Chairman of the Board is, hardly an “enemy” of AFSCME. For many years he was responsible for negotiating collective bargaining agreements on behalf of the State, including many of the prior state contracts that AFSCME now praises. Most importantly, both AFSCME and the Administration voluntarily signed a legally binding tolling agreement providing for the Labor Board to resolve any dispute over whether the parties are at impasse. For AFSCME to preemptively impugn the integrity of the Labor Board is puzzling.
AFSCME complains that “in a recent case regarding an issue related to contract negotiations, the Board hastily rushed a decision and completely upheld the Administration’s position.” Although AFSCME did not identify the case, we believe it must be referring to an FAQ on the State’s website, which can be found at http://www.illinois.gov/EmployeeFAQs. In that FAQ, the State responded that, during a strike, the State can charge striking workers the full cost of their health insurance. AFSCME filed an unfair labor practice charge. After carefully considering the parties’ written submissions, the Board’s Executive Director dismissed the complaint and acknowledged the State’s longstanding policy to charge striking workers for the full cost of their insurance. The well-reasoned decision was upheld on appeal to the full Board. That AFSCME brought and lost a baseless charge is no reason to doubt that the Board gives a fair consideration to every case before it. For AFSCME to suggest otherwise is regrettable, let alone begging the question why AFSCME would voluntarily enter into an agreement to submit the impasse dispute to such a tribunal.
Myth: The Governor is “now seeking to impose on state employees” his contract.
Fact: Under the terms of the tolling agreement, it is up to the Labor Board’s to decide if the parties are at an impasse and whether the State may implement its last, best and final offer. It is critical to mention that the last offer made by the State to AFSCME is substantially similar to the agreements signed by 17 other unions. These agreements were ratified in many cases by over 80% of state employees in those unions. This is not a radical or extreme contract as AFSCME has portrayed, but one that is fair, reasonable, and overwhelming accepted by several thousand State employees already.
By submitting this dispute to the Labor Board, the Governor did nothing more than invoke the very process to which both parties voluntarily agreed.
What the Governor is seeking, and AFSCME is refusing, is for AFSCME to submit the Governor’s actual proposal to employees for a vote. What better way is there to determine whether the proposal is deemed fair and reasonable by the very people whose work will be governed by that proposed contract?
Myth: The Teamsters’ agreements provide “far more generous health insurance terms.”
Fact: Comparing Teamsters’ health insurance to AFSCME’s is like comparing apples and platypuses. AFSCME employees’ health insurance is provided by the State, where the State charges premiums. Teamsters’ health insurance is provided by Teamsters’ own health and welfare funds. The State contributes to those funds but does not get to decide the level of coverage or premiums. It is entirely out of the State’s control. Teamsters can provide the bare minimum coverage under the Affordable Care Act or they can provide more. Either way, the State plays no role.
The most that can be said in comparing Teamsters and AFSCME for health insurance is that, unlike AFSCME’s demand for a guarantee of Platinum coverage at Silver prices, Teamsters received no such guarantee from the State. What Teamsters get is entirely up to Teamsters’ own funds. This is similar to the point AFSCME makes about the trade unions with whom the Governor signed twelve separate collective bargaining agreements. AFSCME claims the distinguishing feature is that the trades’ agreements do not include a wage freeze. But what AFSCME fails to mention is the trades get compensated on a wholly different metric, known as the prevailing wage. That wage is determined through a certification process administered by the Department of Labor and is not guaranteed to increase during the course of the contract. In fact, the prevailing wage could go down over the life of the contract. So, there too, while AFSCME is demanding guaranteed wage increases through general and step increases every year of the contract, other unions have received no such guarantees.
As against seventeen other unions that have ratified the State’s offer by wide margins, AFSCME stands alone in demanding guaranteed wage increases and luxury health insurance coverage at what could be characterized as garage sale prices.
Myth: Only union workers are being asked to sacrifice due to the financial circumstances in the State.
Fact: Everyone is making sacrifices. Non-union employees are also on the State’s health insurance and will be subject to any premium increases or plan changes. This includes the Governor’s staff and the labor relations people who made this proposal. It’s also worth noting that non-union employees haven’t received an across-the-board wage increase in ten years. Cherry-picking salaries of some in the Governor’s office-without noting that the Governor’s office payroll is less now than it was during his predecessor-is as uninformative as focusing on the compensation of AFSCME’s top executives.
Fact is, our employees tell us all the time, as Teamsters and other unions told us during bargaining, that they are ready to be part of the solution, not the problem. They recognize that state employees in Illinois make more than their counterparts in other Midwestern States. For example, Illinois state workers made, on average, over $20,000 more per year in 2014 than state workers in Indiana or Missouri. In absolute dollars, Illinois state worker pay was third-highest. The two higher-paying States, California and New Jersey, have significantly higher costs of living. After adjusting for cost of living, Illinois workers are the highest paid in the country. The Governor is proud of our state workers and has never proposed to cut their salaries. He only asked for true shared sacrifice as we, all of us, together right our State’s fiscal ship.
Myth: The Administration does not accurately report what is said at the bargaining table.
Fact: Here’s what AFSCME’s Executive Director Roberta Lynch said during bargaining: “People who came up with this [merit pay proposal] ought to go to f**king prison . . . fact that you want to give measly 25% to some who are doing the job already . . . 75% of people not doing their best - that’s a f**king lie. I think it’s an insult to every single person who works for the State of Illinois.”
Here’s how AFSCME interprets the above quote: “it wasn’t fair to leave out 75% of employees from getting a bonus, given the difficult jobs that employees do-and that whoever came up with that idea should try going and actually working in a prison so they’d know how hard the job is.”
We appreciate that AFSCME’s Executive Director regrets her choice of words when she reads those words on paper. Nonetheless, she does not get to rewrite the history of negotiations based on what she wishes she has said.
Myth: SB1229, the arbitration bill that AFSCME unsuccessfully lobbied last summer and fall, was an opportunity to resolve outstanding contract disputes in a fair and rational manner.
Fact: Make no mistake about it, SB1229 was AFSCME’s attempt to rewrite the State’s labor laws as they have existed for over thirty years to saddle the State’s taxpayers with a multi-billion dollar cost of AFSCME’s unreasonable contract proposal that it knew, under the existing laws, it could never get the State to agree to at the bargaining table. Outstanding contract disputes-like the current dispute between the parties as to whether they are at an impasse-already have a fair and rational forum, which is the Labor Board, a process to which both sides voluntarily agreed. SB1229, or the new HB580–another version of the same failed bill, which would strip the Governor of his constitutional authority–is as unaffordable and damaging now as it was then. Several other Unions have already negotiated agreements with the State under the existing labor laws. Why must the rules be rewritten to give AFSCME what it wants and the State’s taxpayers cannot afford?
We now know that AFSCME is urging its members to support HB580, to once more ask to strip this Governor-and only this Governor-of his authority to negotiate with employees. This is as clear a signal as any that AFSCME is not interested in negotiating. AFSCME is not interested in defending its unaffordable proposals. AFSCME is only interested in imposing its will through an unelected, unaccountable arbitrator. This is bad faith in spades, and why the matter is now before the Labor Board.
CPS Senior Vice President for Finance Ron DeNard issued the following statement regarding CPS’ bond sale of $725 million in tax-exempt bonds today.
“Borrowing money was never a decision that we took lightly and though some wanted our efforts to fail, CPS needed to move forward in order to keep our doors open so we could educate our children. Along with the tough cuts announced yesterday and earlier this year, the sale of these bonds will produce sufficient proceeds to mitigate our cash flow challenges through the end of the fiscal year. CPS faces many financial difficulties ahead, but we are committed to working with CTU on a long-term contract and the State to finally address the inequitable state funding for CPS that is driving the District’s budget imbalance.”
Background
CPS will make its February 15 debt service payments.
CPS priced $725 million in tax-exempt bonds.
These bonds will largely reimburse the operating fund for expenses that the District has already paid, including capital expenses.
The bonds include $206 million of debt restructuring to provide immediate budgetary relief in FY16.
CPS will postpone its plan to convert variable-rate debt to fixed-rate debt.
CPS will postpone reimbursing the general operating fund for some of the swap termination fees.
About $615 million of tax-exempt securities due in 2044 are pricing for a preliminary yield of 8.5 percent and about $60 million of debt due in 2026 is pricing for a preliminary 7.75 percent, according to four people with knowledge of the deal who requested anonymity because the pricing isn’t final. The top yield is about 5.8 percentage points more than benchmark municipal debt that matures in 29 years, data compiled by Bloomberg show.
“They’re in very severe financial straits,” said Dan Heckman, a senior fixed-income strategist in Kansas City at U.S. Bank Wealth Management, which oversees $128 billion. “This is just an effort to hopefully buy some time so they can continue to get their house in order but what a steep price they’re paying.”
They have a statutory cap of 9 percent, so it’s gonna be tough to go back to the markets unless they improve their financial position.
According to a city spokeswoman, $665 million in bonds maturing in 2044 were sold at a price of 8.5 percent,and $60 million in 2026 maturity securities at 7.75 percent. That’s roughly 580 basis points—almost six full percentage points—more than would have been charged to an AAA-rated school district.
Part of that is due to the terrible condition of Chicago schools. And, city aides are suggesting, part of it is due to Gov. Bruce Rauner’s repeated suggestion that CPS file for bankruptcy, raising market skittishness.
Officials originally planned for an $875 million bond issue. There was no immediate indication how they will make up that shortfall.
Groundhog Day was yesterday, but Exelon appears to want to keep celebrating. The Chicago-based nuclear giant is back to threatening to close nuclear plants in Illinois without financial help from the state.
Three months after appearing to soften on demands for hundreds of millions in ratepayer-financed subsidies, Exelon CEO Chris Crane said today that the company needs financial help this spring from Springfield.
If that doesn’t happen, he said on the company’s fourth-quarter earnings call, “we’ll have to make the rational economic decision” on money-losing plants.
At risk of closure, he said, are two of its six Illinois nukes: the Quad Cities station in western Illinois and the Clinton plant downstate.
It was only in November that Crane said Quad Cities had gone from a money loser to break-even as the company looked forward to 2017. That is no longer the case as future wholesale power prices have dropped since then. […]
The renewed threats come as Exelon posted its first year-over-year earnings increase in years for 2015. The company gave investors the welcome news that it plans to raise its dividend 2.5 percent a year for the next three years.
* Some human service providers received this e-mail yesterday…
Good morning ….
Last week in his second State of the State address, Governor Rauner announced a transformation of the way we provide health and human services here in Illinois . The Governor’s vision rests on five important pillars: focusing on prevention and population health, transitioning from institutional to community care, promoting self-sufficiency and education, paying for value and outcomes rather than volume of services, and the use of data to better know and serve the people of Illinois .
Our health and human services leadership teams have been working to lay the groundwork for this historic transformation. You may have already noticed some changes within the state’s health and human service agencies. The agencies are committed to becoming more innovative, collaborative and effective in caring for the citizens of Illinois.
No one is more aware of this need for transformation than leaders such as yourself who have worked so hard for so long within our siloed, expensive, and too often ineffective system.
Governor Rauner invites you to be a partner in fixing this system. One of the most important lessons reinforced from your meeting with the Governor is that this transformation will require your help. Open communication between our office and your organization will be instrumental as we partner with you to transform Illinois into a national model for the delivery of more innovative, compassionate, and effective healthcare and human services.
Aloha,
Linda Lingle
Chief Operating Officer
Office of the Governor
Rape crisis centers cutting back, LSSI lays off nearly half its staff, Haymarket Center is closing its social setting detoxification program, but, yeah, they’re “committed to becoming more innovative, collaborative and effective in caring for the citizens of Illinois.”
* Dan Mihalopoulos is told one thing by the state’s attorney and another by Kim Foxx…
I filed a public records request with the state’s attorney’s office to get a list of all of the felony cases Foxx tried during her 12 years as an assistant state’s attorney, from 2001 to 2013. Though public officials often dawdle at least as long as legally possible to answer such requests, aides to the embattled incumbent state’s attorney, Anita Alvarez, quickly replied this time.
They said there was a single case — just one — in the Felony Trial Division where Foxx worked with a more experienced prosecutor to win guilty verdicts against the two defendants. […]
Foxx said that the office of Alvarez — the two-term incumbent she is challenging in the Democratic primary on March 15 — had purposely given me a list that was missing many cases she had worked on.
“It is extremely incomplete,” she said. “I did try quite a few cases. This is crazy to me.”
Alvarez’s aides said what they gave me is everything they have on Foxx.
Weird all around.
* From a press release…
Donna More’s campaign to unseat State’s Attorney Anita Alvarez has taken to the airwaves with a month long TV advertising campaign that will run in targeted cable TV regions of Cook County. The effort includes a :30 second spot that insists “Anita Alvarez must go.”
The schedule that the campaign purchased will have both :30 and :15 second ads running in primetime and daytime. The plan calls for the spots to air on major cable networks for now including CNN, MSNBC, Fox News, Lifetime, TBS, TNT and USA networks.
The ads draw a sharp distinction between More and her opponents in the upcoming primary. Citing Alvarez’ misconduct, one ad criticizes her term in office as “justice delayed, justice denied” and then ticks off More’s unique qualifications: a former federal prosecutor with felony jury trial experience and a plan to reduce gun violence.
More is not a politician; she is a prosecutor who is running for office for the first time. She is the only candidate in the March 15 primary that isn’t beholden to political bosses.
* Kerry Lester has an in-depth interview with Cook County State’s Attorney Anita Alvarez. From Kerry’s bullet points…
• She decided within weeks to hand the reins of the investigation over to federal authorities and that she frequently communicated with them in the months to follow.
• A 13-month delay before bringing first-degree murder charges against officer Jason Van Dyke stemmed from the difficulty of building a strong case, not just making an arrest.
• The timing of the charges days after a judge ordered release of a video showing the shooting of Laquan McDonald was “in the interest of public safety,” but she had decided on the charges weeks earlier.
— Illinois is not providing any funding for MAP grants or colleges and universities, which profoundly impacts women. Fifty-four percent of all undergraduates and 62 percent (more than 80,000 women) of MAP grant recipients are women, who will no longer be able to afford college. Research has shown that women with college degrees earn substantially more throughout their lifetimes. […]
— The budget impasse is costing women jobs. Seven in 10 workers employed in Illinois’ nonprofit sector are women and many of these organizations receive state dollars. An October survey by the United Way of 500 organizations that receive state funding found 22 percent have been forced to lay off staff.
— Economic opportunity has also disappeared for thousands of women in Illinois due to cuts to the Child Care Assistance Program. Seventy-eight percent of families using CCAP are female-headed, single-parent households. Without affordable child care, it’s impossible for many of those women to work. CCAP cuts put in place by the Rauner Administration in July remain in place for 10,000 children. In just one week last month, a local provider in Belvidere reported having to turn away two families seeking child care.
— An estimated 66 percent of unpaid caregivers are female. One-third care for two or more people. Without a doubt, cuts to services for children, seniors and those with disabilities will fall upon the shoulders of unpaid or undercompensated female caregivers.
— 60 percent of seniors experiencing food insecurity, meaning they don’t have enough to eat or don’t know where their next meals will come from, are female. Funding to Meals on Wheels has been stopped, placing at risk the 6.5 million meals delivered each year. Many programs throughout the state have already been drastically cut back.
The cost of worker’s comp is the biggest factor driving our job losses. If we simply aligned our workers’ comp costs with those of a state like Massachusetts – which is hardly a bastion of conservatism – we can save state and local taxpayers over $300 million per year, while protecting those who suffer workplace injuries, and grow more careers at higher wages.
Rauner loves to talk about the economic success that Texas has experienced, and he has a point. Texas has had robust job growth, and its unemployment rate is only 4.7 percent—while Illinois’ is more than a point higher. These are achievements Texas should be proud of. But it must be noted that Mississippi has a higher unemployment rate than Illinois, and so do several other conservative states. Guess what else. Texas has a poverty rate of more than 16 percent—the fifth-worst in the country. Illinois’ poverty rate is 11.5 percent, putting us roughly in the middle of the pack.
In other words, although Texas’ achievements are real, they come at a huge cost: Lower wages, less regulation and a weaker safety net are causing poverty to rise and the middle class to shrink.
And while the anti-worker policies of the far right might have contributed to Texas’ record of mixed economic success, they obviously haven’t conferred the same benefits on all states where they’ve been tried. Yet they seem to have had the same costs.
On the other hand, the Democratic approach to economic growth mitigates poverty, raises wages and helps grow the middle class. What’s the unemployment rate in deep-blue Massachusetts? It’s 4.7 percent—the same as Texas.
And, by the way, some progressive states, such as Minnesota and Vermont, have unemployment rates that are far lower.
Biss told me a sentence was cut for space…
It isn’t clear exactly what about the Massachusetts system the governor is advocating for, so I can’t immediately comment on the specifics.
In its first 73 years, few dramatic changes were made to the Massachusetts compensation system. Meanwhile, other states implemented speedier procedures and paid more adequate benefits. In the early 1980s injured workers, unions, and health and safety organizations in Massachusetts campaigned for reform.
In 1985 these groups convinced the state legislature to revamp the system: the Massachusetts Division of Industrial Accidents was reorganized, benefits were increased, cost-of-living protection was added, and insurers were made responsible for workers’ legal expenses.
Five years later, however, the Massachusetts economy entered a downturn. Business groups, exaggerating the burden of insurance premiums and threatening to leave the state, demanded rollbacks in worker benefits.
In 1991, in a shameful display of blaming the victim, the legislature:
• Reduced the total-disability benefit rate to 60% of wages
• Shortened the duration of total-disability benefits to three years
• Reduced the partial-disability benefit rate by 10%
• Shortened the duration of partial-disability benefits to five years
• Eliminated payments for the first five days of disability (except for extended injuries)
• Eliminated benefits for scarring other than on the face, neck and hands
• Reduced cost-of-living benefits
• Eliminated certain injuries from coverage
The governor at the time was Republican William Weld. He did, however, have a Democratic legislature to deal with.
A gubernatorial candidate travels around Massachusetts and hears complaint after complaint from employers about the spiraling cost of insuring their employees. Annual double-digit rate increases have become the norm. Small businesses are wilting under the weight of these costs. Large businesses are considering relocating to places where insurance costs are lower. Many employees do not have access to quality healthcare. The candidate understands that a crisis exists and makes a priority of controlling, if not reducing, these costs. The candidate becomes governor. Is there any possible way this story ends happily?
Actually, it did, in an almost fairy-tale-like fashion, though not without a lot of angst. The year was 1990, the candidate was Bill Weld, and workers’ compensation insurance rates had gone up a staggering 92 percent over four years. Then, shortly after Weld took office in 1991, things went from bad to horrible. Insurers filed for another rate increase, this time a record 45.6 percent. Faced with this mess, the governor pushed through the Legislature a reform bill that he promised would eliminate the need for any rate increase. Very few people thought he would be able to keep that promise.
Let’s skip to the happy ending. Workers’ compensation rates have plummeted by about 60 percent since passage of the reform, in what many observers have described as the most remarkable turnaround in any insurance market in the country.
So, it did work. Now, all Gov. Rauner has to do is figure out how to be as effective as Bill Weld.
/snark
*** UPDATE *** From Rep. Mark Batinick…
Rich,
I’ve been studying the Mass. model for work comp for a long time. Attached is an LRU report from January of last year I requested. They do several things there well that we don’t. When I look at their model I see a system that focuses on the worker getting paid and healed as fast as possible. Any case open more than 12 weeks after an injury must be reviewed “to ensure that the treatment is necessary, reasonable, effective, and of good quality.” While indemnity costs per worker were near the median, the percentage of claims paid within 21 days of the injury was the highest. The benefit of getting the worker paid and healed quickly is self-evident.
And yes. They do have a causation standard.
The Massachusetts information starts on page 4 of the attached report. But in the interest of transparency, I attached the entire document.
As Illinois moves into its eighth month without a budget, Eastern Illinois University plans an estimated 200 layoffs of non-instructional employees — as well as furloughing all administrative and professional staff additionally in March to make it through the spring semester.
These layoffs, along with cash flow reserves and budget cuts and freezes enacted last week, will be used to push Eastern through the semester financially considering no appropriations from the state have been allotted for higher education. […]
In regard to the layoffs, 30-day notices will be sent out to those employees either late this week or earlier next week, President David Glassman told the Faculty Senate on Tuesday. This will start the normal “bumping” process associated with the layoffs such as in the fall, when employees with higher seniority who get a layoff notice can instead “bump” those with less seniority. […]
While the university will run through spring, uncertainty still lingers in regard to what will happen over the summer and in the fall. Glassman said he along with Paul McCann, interim vice president for business affairs, have started looking into if continuing operations during the summer will be possible, relying on tuition alone as income.
“If I find out from Paul that we would not generate enough tuition dollars to operate the university (in the summer), then I have to figure out what’s our other alternatives,” he said.
Eastern is in a similar boat regarding the fall semester. If funds do not come in from the state by the July, August and September time frame, Eastern will not be able to afford the expenses of the semester at its current capacity without changes. This is also dependent on tuition and federal funding.
* I’ve been wondering aloud lately whether the governor has been deliberately attempting to sabotage CPS bond sales since last April. Greg Hinz follows up…
Though no one will speak for the record, insiders are charging that Rauner, who wants to bust the CTU by forcing it into bankruptcy, is trying to block the system’s ability to borrow that $875 million.
The specific charge is that last month, when Claypool was in New York trying to schlep the bonds, Rauner knew it and intentionally scheduled a press conference to announce revived legislation to allow the state to take over CPS and force it into bankruptcy.
“Rauner knew,” says one source who won’t be named. “He did it on purpose.”
Sources close to the governor shrugged off such charges, one saying that Rauner is willing to give CPS a little help if only Emanuel will “give a little help” to Rauner in his campaign to weaken the power of CPS and other public-sector unions.
But there is a bit of a pattern of Rauner, a conservative Republican, opening his mouth in a high-profile way at very inopportune times for CPS and its proposed bond issue.
Rich Miller of Capitol Fax reported on a pair of Rauner statements, one stemming back to April. Then yesterday, after it became clear CPS would try to go to market today, Rauner told reporters that he’s begun considering who to send in to run CPS, even though it’s doubtful he has the legal authority to do that.
Rauner is not backing down. Says a source close to him, “City Hall is spinning out of control. . . .(Investors) see a CPS balance sheet that is fundamentally broken and a financial plan that is a fairy tale. Chicago is crumbling before our eyes.”
Right. “Crumbling before our eyes.” You might say that game is on, too.
He’s actually done this three times, first in April, then last week and again yesterday.
*** UPDATE 1 *** Gov. Rauner just called the allegation that he’s attempting to sabotage CPS bond sales “ridiculous.”
…Adding… He also said that “Bondholders will make their own decisions. I don’t care about them one way or another.”
*** UPDATE 2 *** Greg Hinz has the 5th Floor’s react…
Responding to the governor’s remarks, Emanuel spokeswoman Kelley Quinn shot back: “So much for the governor’s pledge to change his tone in an effort to actually get something accomplished. That lasted almost a week. While it seems he would rather continue pointing fingers and hurling insults, the rest of us will continue working on solutions to the range of challenges facing our city and our state.”
Owed about $200,000 by the state of Illinois, a rape crisis center in Urbana has cut its staff hours and salaries.
And the Rape Advocacy Counseling and Education Services says that without state funding it will have to close by mid-April. RACES, located in Urbana’s Lincoln Square, is among the social service agencies that are not being funded because of the ongoing budget dispute between Republican Gov. Bruce Rauner and Democratic legislators. In 2015, RACES said it served more than 37,408 individuals, ages 3 through adult.
Beginning Monday, the agency cut its staff hours and salaries by 20 percent. […]
The cuts will limit the availability of counselors, legal advocates, and community educators who provide valuable services to survivors of sexual assault, the agency said.
Liberty Principles PAC, which received a $1.8 million contribution from Rauner’s own PAC last month, has moved to boost the campaign of Forest Park Commission Chris Harris who is challenging incumbent State Rep. Chris Welch (D-Hillside), purchasing $14,166 in newspaper advertising for the challenger, according to state election board records.
Run by political operative and radio personality Dan Proft, Liberty Principles PAC, an independent expenditure committee that is prohibited from coordinating its activities with a campaign it backs, is also supporting the reelection campaign of the governor’s Democratic ally in the Illinois House, State Rep. Ken Dunkin (D-Chicago).
Harris, who had at the end of the fourth quarter only $7,727 in the bank, echoes Rauner’s rhetoric on key issues, such as property taxes. […]
Harris reacted to Proft’s purchase of advertising in his behalf saying that he was “uncertain” what triggered the support.
“I did not know this and I haven’t seen any ads. I am not sure if there is a certain issue that they have picked up on that I support that Rep. Welch doesn’t and I guess I won’t know until I see an ad,” Harris told The Illinois Observer in a statement. “This is a Democratic Primary so it doesn’t make a whole lot of sense, in the big picture.”
*** UPDATE *** From the Chris Harris campaign…
The recent discovery that outside PAC money is being
spent in the 7th District State Representative race has raised concerns this group’s motives.
“In modern day politics, you can’t control most of what goes on around you, but you hope you can control your message,” said 7th District State Representative Candidate Chris Harris. “Even that can be altered by 3rd party sources hijacking it, though.”
As first reported by the Illinois Observer, an outside PAC that has received money from Governor Rauner purchased newspaper advertising against current State Rep Chris Welch in the 7th District race.
Harris stated: “There are many reasons PAC’s get involved in races: they want to advance a candidate; they don’t like a particular candidate; or they want a group to have to spend money they may not have planned to. We have yet to see what their plans are for this race, but I am certain that it is not to echo any backing of myself for Governor Rauner. The devastation caused by the budget stalemate should horrify everyone, and I reject Governor Rauner’s strategy of holding Illinois’ most vulnerable people hostage.
“Furthermore, I feel that that it is wrong-headed for Governor Rauner’s people to insert themselves into a Democratic primary election. The people of the 7th District are well aware of Rep. Welch’s poor record, and it is their voices that should decide this election.
“I am a mainstream Democrat. I believe we can have common sense compromise that will secure the financial future of this state. I support increasing funding for our schools and making sure that education is a priority. I am a small business owner who was union-backed in my local race, because I am focused on practical accomplishments that move us all forward.
“I am in this race because our current State Representative has a long history of corruption and patronage that devastated our local schools. We need a Democrat who will focus on fixing our communities and our state, not be a pawn for either Speaker Madigan or Governor Rauner.”
A nonprofit research group says poverty rates in Illinois are up to three times higher for racial minorities.
The Chicago-based Heartland Alliance’s research arm released a report Wednesday outlining significant racial disparities for income, unemployment, birth rates and housing, among other things. The 44-page document is called “Racism’s Toll: Report on Illinois Poverty,” and looks at institutional racism in the state.
* From the press release…
Poverty rates are two to three times higher for Illinoisans of color, and they fare far worse on nearly every measure of well-being. In the latest of its annual reports on poverty in Illinois, “Racism’s Toll,” Heartland Alliance’s Social IMPACT Research Center lays bare the moral, human, and economic cost of the deep inequities in the state and calls out public policies that have and are actively creating these racial inequities.
The disparities are remarkably persistent on nearly all quality of life domains:
Black children in Illinois are nearly 4 times more likely to live below the poverty line than white children.
The Illinois school districts with the most students of color receive 16% less in funding per student than districts serving the fewest students of color.
Unemployment rates are far higher for black Illinois workers than whites at every educational level.
Illinoisans of color are 2 to 3 times more likely to not have health insurance.
Black Illinoisans on average live 6 years less than whites.
Poor black (16%) and Latino (22%) Illinoisans are more likely to live within a mile of a hazardous chemical facility than poor whites (13%).
Nationally, the median net worth for a white household is $110,500 versus $6,314 for a black household.
The consistency and persistence of these severe disparities by race in Illinois underscore how much more work we have to do. As the report makes clear, these inequities are the product of the public policies, market forces, and institutional practices of both yesterday and today, which systematically place barriers in the path of Illinoisans of color.
Labor unions were forced to come to the rescue of their endorsed primary candidate in the 5th state Senate district, Democrat Patricia Van Pelt of Chicago.
On Monday, Van Pelt’s primary opponent, former alderman and unsuccessful mayoral candidate Bob Fioretti, joined the lawmaker for a newspaper endorsement session at the Sun-Times.
“I nearly fell off my chair when Van Pelt said she wants city governments to be able to declare themselves right-to-work zones,” Fioretti told supporters in an email.
“That means she’s against unions, she’s against the prevailing wage, she’s against all the gains unions have gotten for us,” Fioretti said.
What the heck?
* Sen. Van Pelt’s response…
Senator Van Pelt spoke on her longstanding opposition to right-to-work laws and support for unions in a statement today.
“I am against all implementations of right to work in Illinois, including locally,” the senator said. “Right to work in any form is an attempt to undermine unions and working families. Unions are critical in representing the voice of our workers. Having served as a union steward for many years, I know unions have increased fairness, safety, and employer accountability.”
“My opponent is attempting to slander my pro-union record. In a recent interview with the Sun-Times Editorial Board, I misspoke when I misheard a question on right to work zones. I clarified my answer with the board immediately after the interview.
“I’m proud of my record of standing up for unions. I won’t let my opponent distort it.”
The Illinois AFL-CIO, which recently endorsed Senator Van Pelt in the Democratic primary, reiterated their support for the senator. “Senator Van Pelt is a strong voice for unions. She has stood with unions on issues that affect working families and has stated her opposition to wage-killing statewide right to work and local right-to-work zones. We strongly support her re-election,” Illinois AFL-CIO President Michael Carrigan said.
During her tenure in the state senate, Van Pelt has been a tireless advocate for working families. She was a co-sponsor of the legislative override of Governor Rauner’s veto of the AFSCME no strike/no lockout arbitration bill, co-sponsor of civil rights legislation protecting pregnant employees, and co-sponsor of legislation to raise the minimum wage. She is running for re-election for in the 5th legislative district.
Gov. Bruce Rauner on Tuesday said he’s preparing for a state takeover of Chicago Public Schools and has told state Board of Education members to start looking for an interim superintendent for the city’s cash strapped school district.
At a news conference in Springfield to discuss legislation that would change the state’s procurement process, Rauner said he’s already told the state Board of Education to begin the process of identifying who can take over as superintendent of CPS.
“The state’s going to be ready to step in and take action,” Rauner said a day after the Chicago Teachers Union rejected a contract proposal from CPS.
“I asked our administration. I believe it’s coming. I believe a state takeover is appropriate,” Rauner said.
“What’s he gonna take us over with? He has no budget. He has no authority. Please don’t pay attention to the ravings of a madman,” Lewis said of Rauner.
* Rauner eventually walked it back a bit…
.@GovRauner office clarifies earlier remarks: Board of ed preparing for CPS takeover on the condition that legislation enabling it passes.
Senate President John Cullerton issued the following statement regarding the governor directing the Illinois State Board of Education to explore a state takeover of public schools in Chicago:
“I thought we’d already addressed this. The law doesn’t allow him to do that. So it’s not going to happen.”
Claypool said school support staff will likely bear the brunt of the layoffs - teaching assistants, clerks and other administrative roles. A letter to CTU President Karen Lewis from Claypool says the workforce cuts will save $50 million. […]
Claypool said they will also begin deducting 7 percent from all CTU members’ checks as soon as possible due to an inability to meet the pension pickup for teachers. Claypool says the schools will save $130 million with that action. […]
Lewis called the cuts an “act of war” and expects the union will rally against CPS and the “bankers who are siphoning off millions” and announced a demonstration at 4:30 p.m. Thursday and LaSalle and Adams.
* Also…
.@CTULocal1 Will file unfair labor practice over pension pickup and then can strike immediately.
Do they think a strike will somehow restore trust — or will it simply make them feel good to stick their thumb into the administration’s eye? Either way, the hard-liners in the CTU appear to be on a suicide mission to bring the system to its knees.
20-year-incumbent Rep. John Shimkus, R-Collinsville, raised more than $1.3 million last year and had about $1.37 million on hand in his campaign account at the end of 2015, according to his FEC filing. […]
Shimkus’s opponent in the March 15 Illinois primary is state Sen. Kyle McCarter. He raised about $141,000 last year, but about $60,000 of it came from a personal loan, according to his newest campaign reports. McCarter, who has attacked Shimkus as not conservative enough for the district and for going back on a term-limit promise when first elected, had about $87,000 cash in his campaign accounts at the end of last year.
McCarter did raise that much, but it appears that he has to give a big chunk of it back.
Check out his FEC filing. McCarter received money from corporations, which is still not allowed. He’s already identified about $13,000 in corporate contributions as “refund pending” on his FEC report, but some other possible corporate contributions, totaling by my eye somewhere near $8,000, aren’t identified as such.
He also accepted a $37,300 contribution, which is way over the federal limit, and it’s identified on his FEC form as “refund pending.”
So, out of the $81,000 he raised from others (which is a horribly small number to begin with), he admits having to return about $50K of that to donors and might have to return another $8K or so. Either way, that’s most of his January 1st cash on hand.
Among those who missed Thursday’s roll call votes in Springfield on legislation providing funding for community colleges and for MAP grants to low-income college students were Sen. Kyle McCarter, R-Lebanon, and Rep. Reggie Phillips, R-Charleston. […]
“It’s clear that Senator McCarter is focused on the job he wants, not the job he was elected to do. The hard-working families of his district deserve better representation than a politician that skips out on votes to campaign,” said Kayleen Carlson, the campaign manager for U.S. Rep. John Shimkus, the Collinsville Republican whom McCarter is challenging in the 15th Congressional District primary.
McCarter, in a statement, called the legislation “not good policy,” but did not explain his absence from Springfield.
“I have and will continue to fight for education policy that is affordable for the state of Illinois and (Thursday’s) vote was a Democrat bill passed by a Democrat majority with no money appropriated. It is simply not good policy,” he wrote. “This attack is another example of Congressman Shimkus shifting the focus off his liberal voting record of funding Planned Parenthood, Obamacare and amnesty.”
Actually, there was money “appropriated.” The Democrats passed an appropriations bill. There were no revenues provided, however.
* There is no question that the state’s procurement reforms were a complete overreaction to Rod Blagojevich’s reign of error. Here’s just one problem that was outlined in a 2012 Crain’s article…
The biggest concern, particularly for the construction industry, is that reforms meant to curb influence-peddling effectively have turned into gag orders for state employees, who ultimately could lose their jobs if they don’t properly report discussions with contractors, even if it’s just to clarify policy or processes. Contractors, in turn, fear they will be barred from bidding if they bring a good idea to the state.
“I think there’s broad agreement there were unintended consequences, primarily a chilling of useful communication that in the long run would undermine the state’s best interests,” says Illinois Sen. Don Harmon, D-Oak Park, co-chair of the Senate Procurement Committee.
Transportation projects often are too complicated and fast-moving to be completely spelled out in a document. Illinois Transportation Secretary Ann Schneider recently issued a memo clarifying rules for vendors to hold discussions with state employees.
The construction industry “appreciates the guidelines, but it’s still a huge problem,” says Jennifer Krug McNaughton, vice president of Lemont-based K-5 Construction Corp. and chairman of the Illinois Road and Transportation Builders Association. “You need to clear it up legislatively.”
Let this be a lesson: Just because something is called “reform” doesn’t mean the idea is any good or will actually work.
* Gov. Bruce Rauner claims that it takes 9-12 months to complete an RFP process in Illinois. Crazy. And it’s even crazier when you find out the process took only 2-3 months before that “reform” was enacted into law.
So, he outlined a list of changes he wants made today…
Requests for Qualification (RFQ)
• Allows state agencies to create a pre-qualified pool of vendors in different categories of supplies and services, speeding up the process by which the State can receive price quotes and proposals.
Cooperative Purchasing
• Allows the State to “piggyback” on the procurements of other states, governmental entities, and purchasing consortiums in order to leverage this large buying power, while at the same time speeding up the procurement process.
Procurement Exemptions
• Allows an exemption from the procurement code for personal services contracts, public-private agreements governed by other State statutes, domestic and international trade shows and exhibitions, tollway improvements when moving railroads and utilities.
• Allows construction agencies to enter into emergency procurements for greater than 90-days in order to streamline the process of repairing state buildings and structures.
Higher Education Exemptions
• Exempts many procurements that higher education institutions enter into from the procurement code to increase speed and give purchasing flexibility back to universities.
Energy Conservation Program
• Permits the State to use the Energy Performance Contracting model authorized by statute to enact capital upgrades designed to reduce operating costs and improve the functionality of existing state-owned buildings in lieu of adequate capital funds.
Buy Illinois
• Creates a preference for buying supplies and services from Illinois businesses.
Vendor Support
• Allows vendors to fix issues with their registrations with the State and creates a cure period for these mistakes.
• Adds more clarity and guidance to vendors on what constitutes acceptable communication and the prohibited bidder process.
• Streamlines the annual certification requirements for multi-year contracts, reducing bureaucratic paperwork.
• Streamlines the disclosure process for vendors when resolving various issues.
• Streamlines the specifications procedures for procurements by allowing the agency making the procurement the lead on these issues.
• Makes the Illinois Procurement Bulletin more navigable for vendors by requiring bulletins be produced by each agency requiring the procurement.
• Removes the confusing procurement communications reporting requirements for vendors. Streamline the Procurement Reporting Structure Proposed Structure Supports more Streamlined, Consistent and Efficient Procurement Revised CPO Structure
• The bill modifies the current Chief Procurement Officer (CPO) structure. Under the current system, there are four CPOs (General Services, Transportation, Capital Development, Higher Education). The proposed language would place procurement authority in one CPO (CMS Director for General Supplies and Services) with statutory delegations of procurement authority to four Designated Procurement Officers (DPO) (Transportation, Tollway, Capital Development, and Higher Education).
• Returns the Procurement Policy Board to an advisory body and focuses their mission on creating policies and rules consistent with the Procurement Code.
• Streamlines the rulemaking process to eliminate confusion for vendors and businesses by working within one set of rules.
Auditor General Audit
• Requires an audit of procurement every two years, while also allowing the Auditor General to perform surprise audits on the agencies to ensure laws and statutes are being followed.
The problem with undoing reforms, even lousy reforms, is that everybody is gonna think you’ve got a hinky angle. For instance, the governor has been blasting universities for their big-spending ways, but now he wants to let them out of procurement procedures? What up with that?
Well, actually, the universities tried like heck without success to keep themselves out of the procurement process reforms. Many of the problems they predicted turned out to be true.
* I would’ve preferred a bipartisan process on this. The governor’s press conference to unveil his reforms today featured two three GOP legislators, Dan Brady, Pam Althoff and Chapin Rose.
Hopefully, they can work with the other side of the aisle on this because Rauner isn’t wrong. The Democratic majority didn’t allow Gov. Quinn to change the process when he tried a few years back, but maybe something can be done now because something most definitely should be done.
The full legislation is here. Hopefully, our more knowledgeable commenters can sift through the deets and let us know what they think.
* The Tribune updates the fundraising situation. Bob Dold is doing very well, but Mike Noland essentially raised car fare…
Dold raised more than either Democrat in the period from October through December, as he has since the race kicked off. His overall receipts since his 2014 win: almost $2.4 million. He has no GOP primary rival and had about $1.49 million in the bank at the start of year, reports show. That figure does not take into account about $139,000 in the Dold campaign’s debts and obligations. […]
In the last quarter, Dold raised about $464,000 while Schneider raised about $391,000 and Rotering raised about $265,000, which includes a $100,000 loan she made to her campaign. Rotering has loaned her campaign $345,000 overall. Schneider has loaned his campaign $5,000. Schneider started the year with less in the bank: $882,000 to Rotering’s $936,000. […]
In the 8th Congressional District, Krishnamoorthi, who is from Schaumburg, maintained his commanding lead in campaign fundraising. His campaign opened the year with more than $1.27 million in the bank after picking up $453,000 in the quarter. He has raised more than $1.49 million overall. […]
Krishnamoorthi’s Democratic rivals include state Sen. Mike Noland of Elgin, who collected about $68,000 in the last quarter of the year and $210,000 overall. Noland had about $64,000 in the bank to start the year.
Maybe instead of appearing with former Gov. Quinn at an endorsement event, Noland should’ve handed him a phone and a call list, because obviously Noland isn’t doing what he needs to do here.
Seriously, there are state legislative candidates without opponents who raised more than that in the 4th quarter.
* From the Illinois Policy Institute’s news service…
The Senate President is playing politics with a bill that appears doomed on arrival. That’s according to Governor Bruce Rauner’s office in response to Senate President John Cullerton calling for a cooling-off period before sending over a tuition assistance bill.
Senate Bill 2043, which Democrat majorities say will fund MAP grants for eligible students, passed the legislature last week despite minority Republicans pointing out the governor intends to veto the bill because it’s not tied to any funding stream.
Senate President John Cullerton’s office issued a news release Monday saying he’s waiting until February 16th to send the bill to the governor so the governor will “rethink his veto announcement.”
Cullerton’s office said the state isn’t honoring its commitment to students and urged the governor rethink his position and “not act rashly but rather in the best interest of these students.”
Governor Bruce Rauner’s office responded saying there’s no way to pay for SB 2042. The administration has offered a path toward compromise. A statement from Rauner’s office says the governor has agreed “to sign legislation that funds MAP, community colleges and universities tied to ways to pay for the programs.”
The governor’s office says “rather than playing politics with a dead piece of legislation, we urge the Senate to focus on finding real solutions and vote next week on legislation that would fund MAP grants with a fiscally responsible way to pay for them.”
* From today…
Rauner says he has directed board of Ed to see if CPS meets criteria for takeover, and asked they look for possible superintendents.
* The governor will speak today at 11 about reforming the state’s Procurement Code. Listen or watch here.
Comptroller Munger will “discuss the current bill backlog and spending projections for the remainder of the fiscal year, and then take questions from the media.” Her show also starts at 11. Watch her here.
Lack of funding for higher education creates “uncertainty if you’re a student,” she said. But, she added, “some of these universities have cut some of their administrative costs –- sort of squeeze-the- beast theory.”
She said “global questions” about higher ed could now be asked.
“Should we have six, eight schools of education, everybody having a program and everything? I don’t know,” Radogno said. She noted a couple of two-year colleges went to four years, including what is now the University of Illinois Springfield.
“Maybe we ought to have more going from four to two,” she said.
Look, only a fool would defend skyrocketing administrative spending at universities and colleges. The Senate Democrats’ investigative report was a real eye-opener, but not all that surprising.
* So, we can probably infer from Leader Radogno’s comments and the governor’s own recent attacks on higher ed spending that the object here is to starve the beasts into submission.
In the past, universities have been too politically strong to ever force them to do anything. Their alumni organizations (particularly at the U of I) are fiercely protective.
But if the schools are starving, they will be more amenable to accepting significant reforms to stave off massive cuts or even closure.
At least, that appears to be the theory.
* Meanwhile, poor kids are losing their MAP grants (and with it their paths into the middle class) and adult education programs are closing (which shuts off career advancement for older, mostly poorer folks).
I would be far more comfortable with this idea if somebody in power had an actual plan. Just spitballing the closures of entire college programs isn’t really a plan.
In an apparent effort to turn up the heat on floundering negotiations, the Chicago Public Schools announced it would be forced to make $100 million in new cuts — that could be rolled back if a new contract is reached with teachers.
The Chicago Teachers Union blasted the proposed cuts in a news release the union issued even before CPS held the news conference to announce them.
CTU called the cuts “an act of intimidation and bullying because teachers refused to accept a flawed contract offer.” CTU President Karen Lewis was even more blunt, calling it “the latest act of war” and promising a rally of teachers Thursday.
* Mark Brown on the CTU bargaining committee’s rejection of the contract deal cut by Karen Lewis…
Looking at it from the other side, how does schools CEO Forrest Claypool and his team negotiate with a union bargaining committee that can’t confidently speak for its members? […]
The CTU is in a very unique place, as far as labor unions go in the 21st century, its members still empowered by the perceived success of its 2012 strike.
But I would caution its members that if they’re seriously contemplating another strike they should expect to encounter a less sympathetic public than they did in 2012, when public opinion was on their side.
Agreed on both points.
* And let’s hope we don’t have a repeat of 2011, when Lewis signed off on an education reform bill along with the IFT and the IEA only to walk it back after she was ripped to shreds by her own union. And, like now, Lewis was also assailed by folks on the other side of the negotiating table for not being a trustworthy bargaining partner. She cut a deal then disowned it.
After that legislative debacle, Lewis was forced to become even more hardline, which led directly to the 2012 strike.
…Adding… I should’ve noted here that the CTU will be electing officers this spring, which is why Claypool wanted these contract negotiations wrapped up as soon as possible. If this isn’t finalized soon, the campaign will make it even more unlikely that they can get a deal because Lewis will have to guard her left flank (and, considering this union’s membership, it’s a huge flank).
Kent Redfield, a campaign finance expert, called the half-million-dollar contribution the largest single Illinois legislative primary contribution since at least 1976, when the State Board of Elections started keeping track of political contributions.
“It’s a huge contribution,’’ said Redfield, professor emeritus of political science at the University of Illinois at Springfield.
“When you have high-profile races, caps in Illinois law are irrelevant,” Redfield said. “They are going to get waived.”
The Dunkin windfall sends the message that “good things happen to you if you support the governor,’’ Redfield said.
The contribution comes less than a week after IllinoisGO, an independent expenditure committee that some observers call a front for Rauner, reported spending nearly $240,000 on behalf of Dunkin, which lifted the contribution caps in the race. Combined, that’s $27.25 for each voter who cast a ballot in the ho-hum Nov. 4 general election.
Dunkin’s opponent in the March 15 primary, Juliana Stratton, has some catching up to do. The former aide to Cook County Board President Toni Preckwinkle had nearly $70,600 in her campaign fund on Dec. 31, and raised another $78,700 on Jan. 28, mostly from unions.
* Related…
* Ken Dunkin, Sam McCann: Two very different lawmakers facing consequences of crossing their leaders
Family Home Services, a home-care agency that assists hundreds of seniors, plans on cutting agency workers’ pay by half as early as Friday because of the ongoing Springfield stalemate, the Service Employees International Union says.
The union says the action would affect 200 home care workers who now earn between $10 and $11 an hour. Union officials are joining with some Democratic lawmakers for a Chicago news conference to highlight the continued effects of the impasse.
Alvarez, known by nearly all voters, had 34 percent support, while Foxx had 27 percent and More had 12 percent, the poll showed. An additional 26 percent said they backed another candidate or were undecided.
Only about a third of Democratic voters support her, and a quarter are undecided or clueless, but she’s still leading the pack.
The poll found a large percentage of voters don’t accept Alvarez’s explanation for her handling of the McDonald case. More than 7 in 10 Democratic voters said they were not very satisfied or not at all satisfied with it. That included 85 percent of black voters, 67 percent of Hispanic voters and 64 percent of white voters. […]
Overall, half of voters in the poll disapproved of Alvarez job performance, while 30 percent approved and 20 percent had no opinion. White voters were split on the question, while 68 percent of black voters disapproved as did 47 percent of Hispanic voters. The error margin for racial and ethnic subgroups is 5.7 percentage points.
Not to be Mr. Obvious or anything, but if Foxx can tightly sew together blacks, unions and liberals she has a very real path in a three-way primary.
* Meanwhile, this is probably a good move by Alvarez…
Cook County State’s Attorney Anita Alvarez slams Kim Foxx after the Foxx campaign launched a radio ad hitting Alvarez over the Laquan McDonald case, saying she failed to charge in the case for 400 days. Alvarez has contended she was working in concert with the U.S. Attorney’s Office in the period between the shooting and the release of the video. “It’s disappointing that Kim Foxx is running attack ads to score political points off the death of a teenager — in a case that Anita Alvarez has already charged after a joint investigation with the FBI and the US Attorney’s Office,” Alvarez campaign manager Mike Carson said in a statement to POLITICO.”
“Maybe Foxx wants to avoid a discussion about her real record of … raising the sales tax and using tax dollars to give out millions in political pay raises to her supporters. It’s time for voters to learn about the real Kim Foxx.” Given that Foxx is Cook County Board President Toni Preckwinkle’s chief of staff, it’s clear team Alvarez plans to lay Preckwinkle’s flip-flop tax hike at Foxx’s feet.”
THIRD CANDIDATE — Running in the three-way primary for Cook County State’s Attorney is Donna More. More announced Tuesday she is launching a month-long TV ad campaign. From More’s camp: “The effort includes a 30 second spot entitled ‘Anita Alvarez Must Go.’ The cable TV schedule that the campaign purchased will have both 30 and 15 second ads running in primetime and daytime … The ads are intended to draw a sharp distinction between the ‘justice delayed, justice denied’ term of incumbent Anita Alvarez and More’s qualifications for restoring the integrity of the State’s Attorney’s Office. Citing Alvarez’ misconduct, one of the ads says, ‘Anita Alvarez must go.’ The other is a 15 second spot that focuses on More’s plan for reducing gun violence.”
