The departments of Healthcare and Family Services and Human Services will process payments to Medicaid providers as if a budget had been enacted this fiscal year, the departments announced today. The decision comes after the departments reviewed relevant consent decrees and recent court rulings. The effect of today’s decision is to include providers beyond those who serve children. Details will be announced soon.
A University of Illinois official says the outgoing Urbana-Champaign chancellor will receive $400,000 as part of her resignation.
U of I spokesman Tom Hardy says Phyllis Wise’s contract includes a $500,000 retention bonus — $100,000 for each year she stayed. She’s been chancellor for four years.
Wise announced Thursday she’s resigning effective Aug. 12. She cited a range of “external issues” she says have become a distraction.
Wise, 70, is expected to join the faculty after her resignation is effective next week, though, according to her contract, she is first eligible for a one-year sabbatical. Her salary is $549,069 this year, and her new faculty salary is expected to be about $300,000. [Emphasis added.]
There’s also yet another new scandal under Wise’s tenure. Click here.
* I don’t always express love for the Illinois Policy Institute, but their research and hard work on criminal justice reform has been astoundingly good this year…
Illinois law provides few remedies for property-crime victims to recover their losses. Anyone guilty of a property crime, such as theft or destruction of property, may be sent to jail or prison, but this precludes them from working to pay off their debt. And even if victims can cover the cost or time needed for a civil lawsuit, incarcerated defendants rarely have the assets to pay them.
Instead of sending property offenders to prison – a solution that isn’t always the best option for low-level offenders – a better approach is to pursue restorative-justice programs that ensure that property offenders work to pay back their victims.
States such as Texas and Kansas have implemented restorative-justice programs as an alternative method of addressing nonviolent property crimes. For example, “Bridges to Life,” a Texas program, is a 12-week course for offenders currently serving time in prison. Bridges to Life, which has provided services to 3,100 offenders, is a faith-based program that encourages interaction between offenders and victims.
The program requires the willing participation of both the defendant and the victim, as well as either the admission or – more rarely – a finding of guilt by the defendant. If both parties are willing, the process begins with a conference between the two. The victim is given an opportunity to discuss the harm inflicted by the offender. Through this discussion, the victim is able to determine appropriate sanctions, such as compensation for damages, community service or the defendant’s volunteering at the victim’s preferred charity.
Research has shown higher rates of victim satisfaction upon the completion of restorative-justice programs than through trials resulting in incarceration. The restorative-justice process continues only if the defendant clearly acknowledges responsibility for the harm he or she caused and demonstrates remorse.
Mary Beth Jachec lives in a three-bedroom house in Wauconda, a village of 14,000 in Illinois, 45 miles northwest of Chicago. Her semi-detached brick home is unassuming. Her tax bills are not.
The 53-year-old insurance manager gets a real estate tax bill for 20 different local government authorities and a total payout of about $7,000 in 2014. They include the Village of Wauconda, the Wauconda Park District, the Township of Wauconda, the Forest Preserve, the Wauconda Area Public Library District, and the Wauconda Fire Protection District.
Then there is Wauconda Road and Bridge, not to be confused with Road and Bridge, Wauconda Gravel, or with Wauconda Special Road Improvement and Gravel unit – all three of which have imposed separate taxes on her and the village’s other homeowners.
Those three road entities come under the auspices of Wauconda Township. Officials there struggled to explain exactly what they each do, and why three separate taxing bodies are needed. The Wauconda Township Highway Commissioner, Joe Munson, said: “They are all for road maintenance.” So why three? “I don’t know why,” Munson said. “It’s always been that way.” […]
The average homeowner pays taxes to six layers of government, and in Wauconda and many other places a lot more. In Ingleside, 55 miles north of Chicago, Dan Koivisto pays taxes to 18 local bodies. […]
The state is home to nearly 8,500 local government units, with 6,026 empowered to raise taxes, by far the highest number in the U.S. Texas – whose population is more than twice that of Illinois - is second highest with about 5,150 local government units. Florida, with a population 54 percent greater than Illinois, has just 1,650, according to the U.S. Census Bureau.
The Plaintiffs and intervenors in the Ligas Consent Decree accused the State of Illinois late Thursday of flagrantly disregarding the rights of more than 10,000 people with developmental disabilities, and they urged the federal court to order the state to issue Medicaid payments to providers immediately.
Their motion, obtained by McManus Consulting, seeks payments not just for members of the Ligas class but for non-class members as well.
Earlier in the week, attorneys for the state appeared before Judge Joan Lefkow in a case involving Medicaid payments for children and made oral promises to the judge to begin making all Medicaid payments. But the state failed to follow this up with any statement in writing to clarify their intentions, prompting the Ligas lawyers to file their motion.
Residents of CILAs and ICFDDs “are in immediate peril,” according to the motion. “As private providers inevitably reduce or cease their operations, the state will likely have no other option but to place individuals in State Operated Developmental Centers.” The state’s disregard of the court’s orders and federal statutes is “tantamount to placing the Illinois Constitution above federal law, in violation of the Supremacy Clause of the United States Constitution.”
The motion was filed by Equip for Equality and the Roger Baldwin Foundation of ACLU, representing Ligas plaintiffs, and attorney William Choslovsky, representing residents of intermediate care facilities who are intervenors in the case. They requested a hearing next Tuesday before Judge Sharon Johnson Coleman.
Joining in the request was Ligas Court Monitor Ronnie Cohn, who filed an affidavit pointing out that most providers are completely reliant on state funding. “These providers literally live from payment to payment and have no ability to survive even a short termination or reduction of funding,” she said.
PROVIDERS SAY THEY ARE ON THE VERGE OF CLOSING . . .
Affidavits also were submitted by Charlene Bennett of Individual Advocacy Group, Romeoville; Mary Beth Hepp, Helping Hand Center, Countryside; Jessica Rosales, Progressive Housing, Olympia Fields; James A. Keller, Keltech Management Co., Anna; Karen Donovan, Futures Unlimited, Pontiac; Krystal L. Gruenfelder, Parents and Friends of the Specialized Living Center, Swansea; John Huelskamp, Community Link, Breese; and Michael S. Poe, ARC Community Support Systems, Teutopolis.
Rosales said Progressive, which provides residential services to 244 people, has less than 30 days of cash on hand and has maxed out a $750,000 line of credit. They will be forced to close and will default on $12.6 million in revenue bonds. Bennett said IAG has 57 CILAs and “unless some dramatic reimbursement arrangements occur soon,” they will be unable to meet their obligations. Hepp said Helping Hand serves 80 persons in CILAs, including 17 Ligas class members, but will not be able to operate the CILAs with funding for only Ligas class members.
The motion asks for enforcement of both the Ligas decree and an order that Judge Coleman issued June 30, directing the comptroller to make all payments to providers. It says on July 23 the state sent a letter to providers informing them that payments would be made only for Ligas class members, “in complete disregard” of the decree and the order.
The lawyers called the letter seriously misleading. “Through this letter, the state attempts to transform the agreed order into something it’s not–an order which requires the comptroller to make only some payments and which allows the state to pick and choose which payments the comptroller should make.”
“The state’s disruption of funding to service providers impermissibly shifts from the state to the providers the obligation to provide funding to people with developmental disabilities. . . . Funding through the state, though at a rate among the lowest in the nation, is the only means by which providers can pay their employees and pay for housing, food, nursing care, therapy and the other essential needs of the individuals they serve.”
The lawyers said it is a violation of the decree to provide funding only for class members. “As a specific example, Stanley Ligas, one of the named plaintiffs, lives in a four-person CILA (run by IAG) with three roommates he chose, none of whom are class members. With funding only for Mr. Ligas, this CILA home and the supports necessary to maintain Mr. Ligas’ life in the community cannot be sustained.”
* This particular settlement was expected to be the same basic plan that was behind the state employee pay issue. Instead of just paying union members during the budget impasse, because it was too complicated, the judge ordered all state workers be paid.
But, instead of covering everybody at a facility, the state is only providing funding for those folks narrowly impacted by the consent decree. That’s very odd because the object is to keep services flowing to those folks and the groups in question can’t do that with only a fraction of their current costs.
What could happen is that several facilities will have to close. And it’ll be a crazily complicated task to figure out who goes where and who gets dumped into the street.
* I’m pretty darned certain that we’re gonna see more and more public pressure to pass a state law which removes pension benefits from the local collective bargaining processes. A major reason why is that Chicago picks up most of its teachers’ pension payments. The CTU is so far refusing to give any ground on that topic, so something is gonna have to eventually give…
Eliminating the district's practice of picking up the bulk of teacher pension contributions is "strike-worthy," Lewis says.
The problem becomes if the governor leverages the pension bargaining issue to get even more of his collective bargaining “reform” proposals into law. There’s only so much that the Democrats will accept.
Mayor Emanuel essentially dodged the allegation last night on “Chicago Tonight.” But he did have this advice…
“I asked the Speaker and then Gov. Quinn and President Cullerton, that I ran on an effort to make sure our children have the full school day, the full school year, no longer the shortest school day and the shortest school year. We couldn’t make progress, work with me so that we should not have to negotiate that in a contract.
“We worked on it, got it done.”
[Cross talk, including a question about how Gov. Rauner wants a bill that applies statewide.]
“Then work with the legislative leaders on a bill to do that, not try to hold the children of the City of Chicago hostage, not try to hold parents who rely on daycare hostage.”
During a Thursday evening appearance on WTTW’s “Chicago Tonight,” Emanuel said Rauner’s “finger-pointing and name-calling” are not the way to get results. And the mayor expressed frustration over Rauner’s tactics.
“Two weeks ago the governor said that with me and John Cullerton, he’d get a deal already, and now I’m a problem this week.”
When asked if Rauner was trying to get Emanuel to turn on Madigan, Emanuel said: “That’s not going to be a successful effort.”
The Chicago Public Schools pension provision in Cullerton’s bill is designed to offset state funding of teacher pensions granted to every school district in Illinois except Chicago. Emanuel said Rauner’s opposition to the bill amounts to holding Chicago students hostage while trying to squeeze concessions on politically unpopular concepts like right-to-work laws.
“Don’t use it as a pawn to get your agenda where people have hard feelings about it,” Emanuel said.
Emanuel said the governor needs to look at what’s in the bill, not what’s missing, and use it as a starting point for his agenda.
“I say to the governor, having worked for two presidents and as mayor, there’s a way to get some of the things you want done,” Emanuel said. “My point is, rather than try to turn one person against the other, John Cullerton has a bill that addresses two years’ worth of property tax freeze. Let’s work on that product. It also addresses my needs, it addresses some of the Republicans in the suburbs’ needs. There’s a real bill there.”
• Enhancing pension benefits. Former GOP Gov. James Thompson agreed in 1989 to establish a compounding, 3 percent cost-of-living increase for retirees. Another round of benefit enhancements followed in the late 1990s. In May, the state Supreme Court ruled that those changes can’t ever be revoked for tens of thousands of current and retired government workers.
• Clearing a bloated state payroll by letting workers retire early. A 2002 plan created under Republican Ryan and pushed by Democratic House Speaker Michael Madigan cost the pension systems at least four times more than originally billed and won’t be paid off until after 2045, when early-century budgetary ills will be the stuff of history books.
Other factors happened outside policymakers’ control. The collapse of the dot-com bubble in the early 2000s and the 2008 stock-market meltdown accounted for a combined $15.9 billion in pension-investment losses, CGFA reported. And an adjustment downward in long-term investment return assumptions in 2011 pushed Illinois’ pension systems $9.8 billion deeper into the red.
But perhaps the most enduring culprit is the “Edgar ramp,” conceived in 1994 by Republican Gov. Jim Edgar as a 50-year program to stabilize the retirement systems.
* Our resident pension expert RNUG e-mailed me today…
Pretty decent overall but they blew it at the end, failing to note the Rauner pension reform proposals are just as unconstitutional as SB-1 was. Still, it’s a decent primer for people who won’t take the time to read Eric Madiar’s report.
Friday, Aug 7, 2015 - Posted by Advertising Department
[The following is a paid advertisement.]
As not-for-profit financial cooperatives, credit unions of all asset sizes have a well-recognized reputation for providing exemplary service in meeting their members’ daily financial needs – especially when unexpected circumstances arise.
With a membership base of state highway and transportation workers and their families, Peoria Hiway is one of the nearly 30 Illinois credit unions that immediately stepped up to the needs of its members in light of the State’s budget impasse. Should members experience a payroll interruption, this $2.9 million credit union is ready to offer a three month no-interest note, a new loan program made possible via a new initiative with Illinois Treasurer Michael W. Frerichs. Treasurer Frerichs recently announced, in partnership with Illinois credit unions, the availability of more than $50 million in funding for interest-free loans during this challenging time.
Peoria Hiway Credit Union is also experiencing membership growth, as more state employees are seeking out the benefits of credit union membership and turning to them as a new source of assistance. To find a credit union near you that is specifically stepping up to help Illinois State employees and their families, please go to www.icul.com. Illinois credit unions – putting people before profits – one of the virtues that define the credit union difference.
* Former Gov. Jim Edgar told reporters Gov. Bruce Rauner should focus on the budget, not the Turnaround Agenda…
“He comes from a different background than I do. But I just think it’s very important for a governor, you’ve got to have a good budget and you need it in place,” Edgar told reporters. “You can try to compromise on some issues — and I think there are certain things (Democrats in the Legislature) might give him — but some of the things he’s asking for, they’re not going to give him. They’re just not going to give him.” […]
“But I come at it from a little different background. I come at it as someone who came out of state government, and I’m still concerned about the state budget and having a good fiscal foundation,” Edgar said. “(Rauner) comes out of the business world and he’s very worried about some of these economic issues. He’s the governor. I’m not going to argue with him.” […]
“Truthfully the Democrats can walk away a lot easier than he can. They’re not the governor,” he said. “I told him, they’ve proven they walked away before. It’s not like they lay awake at night wondering if everything is working 100 percent. Particularly now that we have a Republican governor, they probably even worry less.” […]
He said he was “worried that in two or three weeks we might be in the same position that we are right now. We need a budget. There are too many things that can fall through the cracks and wheels beginning to fall off and it’s unfortunate.”
Edgar has said the same to me, but he was off the record. This public comment is significant, to say the least.
* ABC 20’s Jordan Abudayyeh sat down with House Speaker Michael Madigan the other day. One of the topics they discussed was Gov. Rauner’s election. Here’s the Speaker’s analysis…
I don’t think that Gov. Rauner won the election, I think that Gov. Quinn lost the election.
And let me just explain this. There was an advisory question on the ballot in November of 2014 concerning the minimum wage. And the thinking was that if somebody came to vote for the advisory question on the minimum wage their political thinking would be such that they would go for Gov. Quinn.
Well, there were 650,000 Illinoisans who found their way to vote for the advisory question on the minimum wage, but could not find their way to vote for Gov. Quinn.
And that’s where I would say that Quinn lost the election, not Rauner winning the election.
Lots of folks have repeatedly made that very same point in comments here.
But just as interesting to me is that Madigan all but admitted to Jordan that he put that advisory question on the ballot to help his governor win an election. It’s an obvious point. Everybody knew it. But I don’t think he’s ever actually come out and said it before.
Natalie Davila, former research director for the Illinois Revenue Department, explains in an article in Tax Facts, a publication of the Taxpayers’ Federation of Illinois: In 2012, 1 in 4 Illinois tax returns claimed a retirement income exemption to avoid paying taxes. Altogether, those exemptions cost the state $2.3 billion — money that could pay down Illinois’ pension debt, or help it catch up on the billions in unpaid bills, or fund those human and other services that are getting squeezed out of the budget by the cost of paying interest and principal on the state’s crushing indebtedness.
While the number of residents filing returns overall has actually declined slightly from 2007 to 2012, the number of people claiming a retirement income exemption has increased by 9 percent. While declared income of all residents grew during that time in the single digits, the value of retirement exemptions grew by 36 percent. In other words, the retirement exemption is eating an ever-increasing chunk of the state budget.
As for the “granny tax,” the amazing fact is that most people claiming the retirement income exemption are younger than 65, according to data Davila obtained from the Revenue Department. Overall, some 60 percent of taxpayers claiming a retirement exemption haven’t even reached “retirement age.” It’s even truer for those whose adjusted gross income exceeded $1 million. About 70 percent of the millionaires who claimed the exemption were actually under 65. Their exemption averaged $241,939.
The governor apparently got a phone call from Mayor Emanuel last night giving him a heads up that the House Democrats were going to add $200 million for CPS pension payments to the federal funding appropriations bill.
The Rauner team then notified the Republican legislative leaders and everybody has a thumbs down on the bill.
A spokesman for the House Speaker said he wasn’t aware of any such plans. A source close to Madigan says there’s been no final decision. Madigan said yesterday that he would amend the bill, but indicated it would only include suggestions (from agencies and the governor’s office) for federal funding lines missing in the Senate’s bill.
They really need to keep that bill as clean as possible.
*** UPDATE *** Steve Brown just called and said he asked the Speaker about this rumor and Madigan said he didn’t know anything about it. “That’s news to us.”
Everybody needs to just calm the heck down and take a breath before firing at each other.
The National Conference of State Legislatures (NCSL) approved a resolution Thursday urging the federal government to allow states to determine their own marijuana policies. For a resolution to pass, it must be supported by a majority of participating legislators in each of 75% of the states represented at the conference’s general business meeting.
The preamble to the resolution, introduced by New Hampshire State Rep. Renny Cushing, notes that “states are increasingly serving as laboratories for democracy by adopting a variety of policies regarding marijuana and hemp,” and it highlights the fact that “the federal government cannot force a state to criminalize cultivating, possessing, or distributing marijuana or hemp — whether for medical, recreational, industrial, or other uses — because doing so would constitute unconstitutional commandeering.”
The resolution states:
NOW, THEREFORE, BE IT RESOLVED that the National Conference of State Legislatures believes that federal laws, including the Controlled Substances Act, should be amended to explicitly allow states to set their own marijuana and hemp policies without federal interference and urges the administration not to undermine state marijuana and hemp policies.
BE IT FURTHER RESOLVED that the National Conference of State Legislatures recognizes that its members have differing views on how to treat marijuana and hemp in their states and believes that states and localities should be able to set whatever marijuana and hemp policies work best to improve the public safety, health, and economic development of their communities.
“State lawmakers just sent a message to Congress that could not be any clearer,” said Karen O’Keefe, director of state policies for the Marijuana Policy Project, which tracks marijuana policy in all 50 states and lobbies in state legislatures throughout the country. “It’s time to end the federal prohibition of marijuana and let the states decide what policies work best for them.
“A majority of Americans support making marijuana legal for adults and even more think states should be able to establish their own marijuana laws without federal intrusion,” O’Keefe said. “This resolution is a strong indication that legislators throughout the nation are not just hearing from but listening to their constituents when it comes to marijuana policy.”
Twenty-three states, the District of Columbia, and Guam have adopted laws that allow seriously ill patients to use medical marijuana if their doctors recommend it, and four states — Alaska, Colorado, Oregon, and Washington — have adopted laws that make marijuana legal for adults and regulate it similarly to alcohol. Marijuana possession, cultivation, and sales are illegal under federal law, but the Department of Justice has indicated that it will not allocate resources toward enforcing federal marijuana laws in cases involving individuals or businesses that are acting in compliance with state laws.
* I told subscribers about this development earlier today. The stuff in the following piece about Emanuel somehow being behind these mailers seems pretty implausible to me. But, aside from that, have a look…
This week Democratic lawmakers across the City of Chicago have been hit with direct mail brochures criticizing them for their “failure” to help Chicago school students and linked them to budget impasse in Springfield.
A “Democratic” Super PAC – IllinoisGO – is the paid sponsor of the mail pieces and is politically aligned with Governor Bruce Rauner, which is led by an ex-aide to Chicago Mayor Rahm Emanuel, Greg Goldner.
At a press conference in Springfield on Wednesday, Madigan called out Goldner by name not once but twice regarding the mail pieces, one of which also landed in Madigan’s district.
“The language, the tone, and the message are remarkably similar to Governor Rauner’s message and this was done by Greg Goldner,” said Madigan, flashing copies of the mailers to reporters. “These mailers are similar to those mailers done throughout the City of Chicago; they were done by Greg Goldner, and the language was remarkably similar to the message that comes out of the governor and the governor’s office.”
Madigan linked Goldner to Rauner. “In my judgment, these two people have come together,” Madigan said.
* During his press conference yesterday, Speaker Madigan accidentally knocked off his microphone’s wind cover, repeatedly teased me for looking tired (the firefighters threw a great impromptu party the night before) and skipped his usual opening speech about “acting in moderation, not in the extreme.” But he did get off some pretty good zingers. For example…
Jordan Abudayyeh: “Governor Rauner is handing out pink slips to 171 workers. Is this going to increase the pressure to get a budget done so that more people don’t lose their jobs?”
Mike Madigan: “Why is he doing that?”
Jordan Abudayyeh: “He claims there’s not money, that’s how he’s going to manage the budget deficit.”
Mike Madigan: “Is he going to not pay those high price consultants he’s outsourcing?”
Thursday, Aug 6, 2015 - Posted by Advertising Department
[The following is a paid advertisement.]
Exelon made $638 million in profits in the 2nd quarter of 2015.
That’s an increase of 22.2% from 2014 - adding up to more than $1.3 BILLION in profit for Exelon so far this year. But Exelon says Illinois legislators should help the company make more. Exelon wants to increase costs on struggling families, businesses and government at a time when human services are being slashed and the state is facing a $6 billion budget deficit.
Yet Exelon is demanding a $1.6 BILLION bailout from struggling family, business and government ratepayers including more than $20 million from Chicago and CPS. Maybe Exelon should be bailing out the State of Illinois and City of Chicago instead of the other way around!
Just Say NO to the Exelon Bailout
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Senate President John Cullerton, D-Chicago, said Tuesday he wants to study the legislation before bringing it up for a vote.
“I’m trying to learn as much as I can about the positions that have been taken so far on that,” Cullerton said. “I met with AFSCME yesterday. I’m going to meet with some labor lawyers to see if I can understand what the significance is of that bill.”
Under the legislation, the measure would bar employees from going on strike or Rauner from imposing a lockout. It would allow an independent arbitrator to be appointed to resolve the talks in the event of an impasse.
Rauner vetoed the measure. He said it is unconstitutional and would put the fate of the contract talks in the hands of someone who does not have to answer to voters.
Wait.
He didn’t understand the bill when it first passed?
I kinda find that hard to believe. But, again, avoiding another confrontation this week could be a good sign, no matter where you are on that particular bill.
Rauner on Wednesday said he wants no more “special deals” for Chicago, a day after the Illinois Senate passed a property tax freeze bill that would also pick up $200 million in pension costs for Chicago Public Schools.
“Chicago shouldn’t be getting special deals. All communities should be treated the same,” Rauner said.
The governor said legislators should not be “cherry picking” what they want in terms of school funding.
“We should treat the people of Illinois equitably and fairly and stop giving special deals for Chicago,” he said. “Illinois should not be a dictatorship from Chicago.”
Despite his strong words against giving Chicago favorable treatment, Rauner has supported efforts to do so in the past. In June, the governor backed a plan that would have allowed CPS to delay making a massive $634 million pension payment by several weeks. That plan stalled in the House, and Rauner floated an alternative idea to give CPS an upfront payment of $450 million in grant money that’s normally distributed over the course of the year.
All he was doing was attempting to “win” the day’s news cycle with a populist, base-feeding cheap shot at the city.
The campaign is over. It’s time to start governing, governor.
*** UPDATE 1 *** Doubling down in the city?…
What: Governor Holds Media Briefing Regarding Property Tax Legislation and Chicago Public Schools
Where: James R. Thompson Center – 16th Floor
100 W. Randolph, Chicago
Date: Thursday, August 6, 2015
Time: 2:00 p.m.
*** UPDATE 2 *** From the governor’s press conference…
The city has requested collective bargaining reforms and that should be acknowledged, he said.
Gov. Bruce Rauner wants local governments empowered to decide what topics will, or won’t, be subject to collective bargaining with their employees. To see why that admittedly dramatic proposal could help Chicago and its school system stave off financial disaster, return with us to … 1981.
How long ago was that? Well, Prince Charles married Diana, Princess of Wales. The U.S. encountered its first five known cases of AIDS. And Ronald Reagan entered the White House. Oh — 1981 also was the year that Chicago Public Schools agreed to pay not only the employer’s share of pension contributions, but 77 percent of its employees’ shares too. What could possibly go wrong with that?
Because labor negotiations start with the old contract as the bargaining basis for the new, CPS’ “pension pick-up” has endured for 34 years — even as the district’s finances imploded. Suggest that CPS should pay its share of pension costs and that teachers should pay theirs, as Mayor Rahm Emanuel and schools CEO Forrest Claypool have ventured, and you’re accused of “attacking teachers,” as the Chicago Teachers Union asserted Wednesday.
Chicago, the Chicago Public Schools and many other local governments and school districts in Illinois face a precarious financial situation. But they’re supposed to find their way out without revising the costly provisions of local government contracts that have survived generations of public officials. Gov. Bruce Rauner says, correctly, that copying these provisions from contract to contract creates a one-way ratchet by which decisions made decades ago cannot, in effect, be altered. Unions refuse.
* I think a good case can be made to take pension payments out of the collective bargaining process. It would be a good first step to then phasing out the state pickup of school employer pension payments. But, as you’ll recall, that pension issue is just one small part of the governor’s actual proposal…
Prohibited subjects of bargaining.
(a) A public employer and a labor organization may not bargain over, and no collective bargaining agreement entered into, renewed, or extended on or after the effective date of this amendatory Act of the 99th General Assembly may include, provisions related to the following prohibited subjects of collective bargaining:
(1) Employee pensions, including the impact or implementation of changes to employee pensions, including the Employee Consideration Pension Transition Program as set forth in Section 30 of the Personnel Code.
(2) Wages, including any form of compensation including salaries, overtime compensation, vacations, holidays, and any fringe benefits, including the impact or implementation of changes to the same; except nothing in this Section 7.6 will prohibit the employer from electing to bargain collectively over employer-provided health insurance.
(3) Hours of work, including work schedules, shift schedules, overtime hours, compensatory time, and lunch periods, including the impact or implementation of changes to the same.
(4) Matters of employee tenure, including the impact of employee tenure or time in service on the employer’s exercise of authority including, but not limited to, any consideration the employer must give to the tenure of employees adversely affected by the employer’s exercise of management’s right to conduct a layoff.
* While the Tribune editorial board is making it seem like the governor is a wholly reasonable and moderate man who is being unfairly blocked by an entirely unholy, unreasonable cabal of union thugs and “Democrat Party bosses,” the paper’s news side hasn’t bought in…
Gov. Bruce Rauner on Wednesday tried to use Chicago Public Schools’ money woes and lack of a new teacher contract as leverage, saying the state should not help the district pay for pension costs without also giving local governments across Illinois the ability to limit unions’ collective bargaining ability.
The first-year Republican governor’s criticism was directed at a proposal passed a day earlier by Senate Democrats that would freeze property taxes statewide and pick up roughly $200 million in CPS pension costs. Rauner said that while he supported the idea of a two-year tax freeze, he could not support the Senate measure because it doesn’t contain provisions to let towns and school districts determine what benefits were covered by collective bargaining.
CPS CEO Forrest Claypool tried to distance himself shortly after from the governor’s remarks, issuing a statement that said “mixing labor issues” into the Senate proposal wouldn’t relieve the district’s financial pressures.
Last year, on November 4th, a McLean County judge handed down a sentence for drug possession. Two days in jail. Twenty-four months of probation. Thirty hours of community service. All typical for that kind of crime. The $500 base fine was also standard. Ultimately, however, the first-time offender will walk away paying — or owing — $3,165.50. That’s typical, too.
Like many other states, Illinois has tried to fund its criminal justice system through a series of fees and fines on the men and women who are caught up in it. Backers of this approach say it makes sense that criminals should defray the costs they impose on society. There are, however, a number of problems with the practice.
From a practical standpoint, the majority of people who encounter the criminal justice system are among the least affluent in American society. That makes collection a challenge. It can also lead to debt that makes the already difficult job of re-integrating offenders into society that much harder. For the McLean County individual, the $3,165.50 would take nearly 384 hours of work to pay off at Illinois’ minimum wage — nearly 10 weeks — and that’s not accounting for taxes, food, shelter, clothing and bus fare.
In addition to the practical considerations, the concept of fee-based criminal justice raises philosophical questions. If the plethora of costs are styled as “user fees,” who are the primary users of the criminal justice system? Who are its primary beneficiaries? The people being arrested, tried and convicted? Or the rest of us, who enjoy the protection the law provides? […]
For the McLean County offender, the aggregate comprises 33 separate line items. It includes the base felony fine of $500, $100 for the street value of the drugs, $350 for the traffic and criminal conviction surcharge, $250 for DNA analysis, $100 for the Illinois State Police crime lab, $172 for the violent crime victim assistance fund, $30 for the juvenile records expungement fine, $10 for the medical costs fund, $10 for drug court fees, $15 for the child advocacy center fee, $500 for the drug treatment assessment fund, $100 for the drug trauma fund, $5 for the drug spinal cord injury fee, $25 for police drug task forces, $20 for the prescription drug disposal fund, $30 for the state’s attorney, $22 for the sheriff, $15 for document storage, $9.50 for the copy or motion fee, $10 for probation operations and $600 for probation services — 24 months at $25 per month.
And new fees keep coming. This year, in the wake of outrage over police killings of unarmed black men in New York, South Carolina and Missouri, the Illinois General Assembly passed legislation to equip officers with body cameras. It would be funded by a 50 percent hike in the Traffic and Criminal Conviction Surcharge, a fee that, as its name implies, is imposed on everyone convicted of criminal and traffic offenses. Currently it’s a $10 upcharge on every $40 in fines, but that would increase to $15 under the body cam legislation. It would have been an addition $175 for the McLean County offender.
And, as Brian points out, we have a police body cam bill now partly because of the Ferguson incident. But studies have shown that a big reason for all the over-policing and high arrest and incarceration rates in St. Louis County is that local government budgets depend far too heavily on a whole bunch of fees and fines which the poor can’t pay, and because they can’t pay they wind up back in jail.
The budget quagmire has affected everything from the recruitment and retention of faculty to the Monetary Award Program, or MAP grants, for students.
“The MAP students are the first casualties of this budget impasse,” Applegate says. “And of course they’re the low-income students, the students that are the most vulnerable. Now some of our institutions, I know, plan to front the money for the students, in the hopes that they’ll eventually get paid. Not all of them can afford to do that.”
More than 125,000 students are eligible for MAP grants this year.
Although payments for the Monetary Award Program don’t typically start until mid-August, the Illinois Student Assistance Commission said uncertainty over the budget could cause some colleges and universities to wait to credit students with grants.
“In some cases, this could lead a student to take out additional loans, drop some classes, and then even be unable to enroll in the next semester if there was still an unpaid balance on the student’s account,” said ISAC spokeswoman Lynne Baker. […]
And, at the community college level, she said some schools could hold a student’s federal Pell grant to cover the missing MAP money, leaving students without access to cash for immediate expenses.
* Mid-August is coming up fast. Some universities and community colleges will probably just agree to wait for the state money. But will all of them? And for how long?
Statehouse types are gonna feel some major heat from seriously irate parents if tens of thousands of college students can’t afford to go back to school.
“So far, AFSCME has demanded a very big pay hike, pension benefits, health improvements, tough work rules,” Rauner said. “They have not made any concessions. We’ve compromised off of our initial proposals. So we’re stuck.”
* But check out what Dane Placko found when he looked at state school superintendent Tony Smith’s own employment contract…
The three and a half year deal starts at $225-thousand dollars, with three-percent raises each year.
Smith gets 35 days’ vacation, which is seven full weeks, but can bank 20 of those days each year and cash them in when he leaves. […]
And while all state employees are required to pay for part of their health insurance and pension, the Board agreed to pick up Smith’s employee contribution for both, a perk worth thousands of dollars a year.
Not to mention that sweet little deal that makes up for the loss of retirement income for being in the Tier Two pension system.
* The governor’s office denied all knowledge of Smith’s contract, and Rauner’s hand-picked school board chairman James Meeks is reluctantly backtracking…
“We’ll renegotiate (the contract), but it may end up costing us more money…I think it’s all much ado about nothing. The general assembly is bored. They should be more focused on getting a budget.”
he state budget stalemate led two Wall Street ratings agencies Wednesday to downgrade by several notches more than $3 billion in bonds issued by the agency that runs Navy Pier and McCormick Place.
Both Standard & Poor’s Ratings Services and Fitch Ratings kept the debt ratings of bonds used to build facilities near McCormick Place three levels above junk status, but S&P also placed it on a negative watch and Fitch gave it a negative outlook.
Although the Metropolitan Pier and Exposition Authority has more than enough money to make bond payments, it did not make a required $20.8 million monthly payment July 20 to a trust account because of lack of state authorization, according to the ratings reports. Enough money must be in that account to make debt service payments that are due Dec. 15.
Senate lawmakers had hoped to avoid the downgrade, and a day earlier passed legislation that would allow McPier to make the debt payment in spite of the budget impasse that had held up those dollars. S&P was dismissive of that legislation, saying its passage would not affect the rating.
S&P acknowledged McPier’s financial ability to make its next debt service payment on Dec. 15 and that the funds cannot be used for any other purpose without legislative action. But “we now believe this (payment) structure is vulnerable to (state budget) pressures as they play out in the state budget and appropriations process,” the agency said in a statement. “The rating action reflects our view that the bonds are in fact appropriation obligations of the state, rather than special tax bonds, and are now one notch below our current A-/Watch Negative general obligation rating on Illinois.”
The BBB+ rating remains investment grade and three notches above junk status, according to S&P’s rating scale.
McPier bondholders are not immediately in jeopardy of not getting paid, but the ratings downgrade is the latest ripple effect of the deadlock in Springfield.
While the legislation would ensure bondholders get paid later this year, it won’t impact MPEA’s rating given that Standard & Poor’s now considers it an appropriation obligation, which limits the rating to one notch below the state.
Several buyside analysts that follow the MPEA credit said they believe applying that methodology more accurately reflects the risk.
“It’s an example of why it’s hard to trust some public ratings,” said one buyside analyst of Standard & Poor’s previous view. […]
“The previous AA-minus rating reflected Fitch Ratings’ assessment that the bonds were distanced from the general operating pressures of the state,” Fitch analysts wrote.
“This is no longer the case,” they wrote. “Therefore, the rating is limited to one notch below the GO rating of the State of Illinois.”
In secondary market trading on Wednesday, the spread for some of the authority’s bonds over Municipal Market Data’s benchmark triple-A yield scale jumped to 136 basis points from 88 basis points on July 28. That involved $5 million of bonds due in 2028, according to MMD.
On Wednesday, three Republican members of COGFA voted to keep the facilities open: Rep. Raymond Poe of Springfield, Rep. Don Moffitt of Gilson, and Rep. Mike Unes of East Peoria.
Poe said after the hearing that lawmakers should consider putting more teeth into the state’s law covering facility closures so that the COGFA decisions are binding. […]
Moffitt said Rauner should use the COGFA vote as an opportunity to look for new approaches to keep the facility open.
“I think the idea would be he would postpone any actions (to close it). Back off, take a look, how can they bring more revenue to the state?” Moffitt said.
* Over in the Senate, GOP Sen. Sam McCann, who represents Springfield, voted “Yes” on Sen. Andy Manar’s bill to keep the museum open.
* Also, yesterday, 9 Senate Republicans voted “Present” on a bill that would overturn the governor’s emergency rules that will slash childcare assistance admissions by 90 percent, including all three SGOP members of JCAR. One of those Republicans told me today he knew the bill was going to pass and didn’t want to be listed as voting against childcare, especially considering that Gov. Rauner may very well do yet another u-turn.
Smallish defections, for sure, but still somewhat notable.
