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Rauner to Madigan: No stopgap budget without term limits and property tax freeze

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* According to the governor’s office, during today’s leaders meeting, after Speaker Madigan made clear he would not negotiate on reforms and would only negotiate a stopgap spending bill, Gov. Rauner declared he would only consider a stopgap spending bill if the General Assembly first passes term limits and a “permanent property tax freeze.”

I’m told he also made clear his preference remains a balanced budget with reforms where no one reform had to be included.

Is a final showdown coming early next year when the state’s checkbook runs dry? If people stick to their guns, it sure looks like it.

posted by Rich Miller
Wednesday, Nov 30, 16 @ 12:36 pm

Comments

Rauner - “I’m all-in”

Madigan - “I call”

Here we go…

Comment by Oswego Willy Wednesday, Nov 30, 16 @ 12:38 pm
I strongly support term limits in the GA to 12 years. However, the budget and this matter are two different issues.

The property tax issue is relevant.

Comment by Federalist Wednesday, Nov 30, 16 @ 12:38 pm
Check book runs dry? You mean drier than it is now?

Maybe Madigan won’t be sponsoring a lawsuit to get legislators paid. /s

Comment by Deft Wing Wednesday, Nov 30, 16 @ 12:40 pm
Here you go:
“Budget and reforms!”
“No, and I’ll go one further and work to stop the one thing we both deep down agree eventually needs to be done.”

That’ll play well.

Get ready for 2018.

Comment by m Wednesday, Nov 30, 16 @ 12:41 pm
Property taxes are local, and the majority of it goes to the schools and the roads. Make the schools and the roads 100% state funded. There, property taxes lowered.

As to the rest. The reason Trump got elected was that his supporters thought he would get stuff done. Too bad they didn’t check out how that’s working in Illinois first.

Comment by Thoughts Matter Wednesday, Nov 30, 16 @ 12:42 pm
Afscme won’t need to strike.No one to carry out those consent decrees

Comment by David Wednesday, Nov 30, 16 @ 12:44 pm
You don’t need to be a weatherman stuck in Punxsutawney, Pennsylvania to recognize this pattern.

Comment by AC Wednesday, Nov 30, 16 @ 12:45 pm
LOL.

Madigan can’t wait for a vote on a permanent property tax freeze.

Republican mayors across illinois will be apoplectic.

Anyone checked to see where the municipal league stands?

Comment by Juvenal Wednesday, Nov 30, 16 @ 12:50 pm
He that can have Patience, can have what he will
– Benjamin Franklin

Comment by Nothin's easy... Wednesday, Nov 30, 16 @ 12:50 pm
What happened to “No pre-conditions?”

Permanent property tax freeze? The law of unintended consequences will hit hard with this one.

For those that rely on some level of state funding, the state has been completely unreliable the last five years. They have not delivered promised funding the past two years.

Freezing LOCAL capacity sounds like a great idea./s

Comment by JS Mill Wednesday, Nov 30, 16 @ 12:52 pm
Given the constitutional problems with reducing future accrued pension benefits, there are limited options for ensuring funding of those systems. Two remaining options are severe state income or sales tax increases, or shifting the pension obligations to the unit of government that incurred them and restructuring the pensions in bankruptcy. With a shift, there would necessarily be an increase in property taxes — although it could be “offset” with a reduction or holding of the state income tax. Freeze property taxes eliminates one of the few remaining options for fully funding pensions, and the remaining options would be massive state income or sales tax increases. Thoughts?

Comment by Inquisitor Wednesday, Nov 30, 16 @ 12:52 pm
As a condition of the last stop gap, Speaker Madigan promised one Turnaround agenda item- pension reform.

Now the Speaker has gone back on his word and has mad clear he will not negotiate on any reforms.

Looks like it could be a rough spring for CPS because of the Speaker’s backtracking.

Comment by Lucky Pierre Wednesday, Nov 30, 16 @ 12:52 pm
Going back to the WWI analogy:

Verdun.

Comment by Quiet Sage Wednesday, Nov 30, 16 @ 12:55 pm
ISP court has ruled on pensions. Any change to existing members has to be done with their consent, and one of the options that has to be given to them is”keep what you have”. Bankruptcy not a legal option.

Comment by illdoc Wednesday, Nov 30, 16 @ 12:58 pm
==As a condition of the last stop gap, Speaker Madigan promised one Turnaround agenda item- pension reform.

Now the Speaker has gone back on his word and has mad clear he will not negotiate on any reforms.==

Yup.

Comment by Anonymous Wednesday, Nov 30, 16 @ 1:00 pm
Lucky Pierre

Humor me. Throughout the past 2 years, have you found fault with anyone other than Madigan or the democrats in general? I won’t even inquire specifics. Have you, at any point, that BVR or his caucus have made a single misstep?

Comment by AlfondoGonz Wednesday, Nov 30, 16 @ 1:00 pm
Perhaps Sen. Radogno can explain how term limits and a “permanent” property tax freeze (whatever that is) are “integral to the budget.”

And where in the Constitution that it says a state budget is “optional,” dependent on political pre-conditions.

Comment by wordslinger Wednesday, Nov 30, 16 @ 1:01 pm
Looks like Rauner is trying to fight a two front war. Without a stopgap budget, he can not survive a strike. I don’t think the state could contract services without some form of budget. I predict Rauner will cave on the stopgap budget. His crown jewel would be busting the union. Madigan should push for a real balanced budget once the strike is looming. Rauner will have to agree to one or the other.

Comment by Anon1234 Wednesday, Nov 30, 16 @ 1:01 pm
How many people still don’t realize that the Federal Constitution does not allow states to declare bankruptcy?

Comment by A Jack Wednesday, Nov 30, 16 @ 1:02 pm
So the property tax freeze is permanent now? That will end up working out well.

Comment by Juice Wednesday, Nov 30, 16 @ 1:03 pm
LUCKY

Get real. The courts have ruled. There is no solution re: pensions other than fulfill the obligations.

If you are so smart lets hear your solution to the pension crisis and forward it to the Gov. I am sure if the solution is constitutional Madigan would give it serious consideration.

Comment by MOON Wednesday, Nov 30, 16 @ 1:03 pm
Anyone who demands a property tax freeze has no idea how property tax is calculated or what it is used for.

Gov. 1.4%: grow up.

Comment by Nick Name Wednesday, Nov 30, 16 @ 1:04 pm
A Jack — One consequence of a pension shift is that the burden is shifted to a unit of government that can declare bankruptcy.

Comment by Inquisitor Wednesday, Nov 30, 16 @ 1:06 pm
Rauner Republicans claim Dems are “devoid of ideas” while Rauner continues to demand two really awful ideas as the price of a budget.

Comment by ZC Wednesday, Nov 30, 16 @ 1:07 pm
How do term limits affect the budget? How does limiting the number of years ago legislator can be in office bring in any amount of revenue or cut the budget? How is this “business friendly”?

How does freezing a local funding mechanism, property taxes, raise revenue for the State?

None of these ideas makes any sense, unless you are holding the State government hostage for your personal agenda.

Comment by Huh? Wednesday, Nov 30, 16 @ 1:10 pm
This clearly meets Rauner’s number one goal of making Illinois desirable to business.

Comment by Trapped in the 'burbs Wednesday, Nov 30, 16 @ 1:10 pm
===shifted to a unit of government that can declare bankruptcy===

Um, no. That’s not allowed in Illinois. Have you been hiding under a rock for two years?

Comment by Rich Miller Wednesday, Nov 30, 16 @ 1:11 pm
Rauner loses most of his spending authority in 31 days. He has an unfriendly Comptroller getting sworn in on Monday. And he signed a spending bill that is 8 billion short of revenue.

I would say this is very close to checkmate.

Comment by A Jack Wednesday, Nov 30, 16 @ 1:12 pm
How about leadership term limits? I bet a lot of folks could get behind that one.

Comment by Archiesmom Wednesday, Nov 30, 16 @ 1:14 pm
The Property Tax Freeze sounds as wonderful as the Healthcare Cost Containment Council. We can pretend Freeze means a 100% freeze everywhere, but that would be naïve.
What it means is there will be a Board to grant exceptions for Water and Sewer Extensions, providing the ‘right’ (wink) Lobster is hired, and the ‘right’ (wink) contractor. Think Stu Levine. A means to create a choke point for State-wide a thumb on the scale of fairness. You want to do something locally?…well send a pile of dough to the Dome and maybe we will let you…maybe.

Comment by yeah Wednesday, Nov 30, 16 @ 1:14 pm
Did BigBrain SuperStars share the poll numbers that helped them pick those 2 issues out of the grab bag?

Comment by Annonin' Wednesday, Nov 30, 16 @ 1:15 pm
LP is correct on the CPS pension funding being contingent upon a pension reform agreement. President Cullerton said as much on the Senate floor near the end of May. The bill was SB 318.

Comment by Team Sleep Wednesday, Nov 30, 16 @ 1:19 pm
I think Rauners end game regarding pensions is to let the pension funds run out of money.

This will result in a constitutional confrontation between the courts and the legislature and Governor. Under separation of powers I do not think the courts can order the legislature to appropriate money or order them to increase taxes to fund the pensions.

Thus, once there is no money left to cover the pensions all sides will have to come together and work out a compromise…..REDUCED BENEFITS.

Comment by MOON Wednesday, Nov 30, 16 @ 1:25 pm
Should be easy to get done. Term limits are bipartisan and very popular across the board. Assuming lawmakers werent lying to their constituents during campaigns when promising to represent their districts

Comment by Very fed up Wednesday, Nov 30, 16 @ 1:26 pm
Freezing property taxes will put more pressure on the State budget, as it would force school districts to turn to the State for funding frozen to them from property taxes.

Also, freezing property taxes, in addition to hurting schools, could also hurt the quality of local roads and services. What business will want to move to an area in Illinois where schools, local roads, and local services are not funded properly?

Comment by Joe M Wednesday, Nov 30, 16 @ 1:26 pm
Seriously, can someone explain what a “permanent property tax freeze” is?

The level of annual collections could never be changed? How? What would make it “permanent?” Are there other statutes that are “permanent” and cannot ever be changed by future General Assemblies and governors?

Or is it just more nonsense words, that sound good, but mean nothing?

We’re full up on those, already.

Comment by wordslinger Wednesday, Nov 30, 16 @ 1:27 pm
===Should be easy to get done===

LOL

I read somewhere that no General Assembly in any state has ever imposed term limits on itself. Always comes from voters.

Comment by Rich Miller Wednesday, Nov 30, 16 @ 1:29 pm
No Moon…. There are plenty of examples of court orders forcing Illinois to make payments. The state shorted the pension systems over the years, the ISC has ruled that the only choice is to pay the benefits.

Comment by illdoc Wednesday, Nov 30, 16 @ 1:32 pm
Rauner is only in office for 24 more months. There will be no budget while he is there. Delay delay delay is in play!!!

Comment by Anonymous Wednesday, Nov 30, 16 @ 1:34 pm
Rauner - “I’m all-in”

Madigan - “I call”

Spot on if you reverse it.

Comment by LessAnon? Wednesday, Nov 30, 16 @ 1:37 pm
illdoc

The courts cannot order payments when there is no money to pay the the pensions.

Without money there needs to be legislation to fund these obligations. Thats where the constitutional confrontation will occur.

Comment by MOON Wednesday, Nov 30, 16 @ 1:37 pm
-very fed up
Good point, lots of support for term limits in campaigns this year.
If it’s on the board, there’s 30 and 60.
Madigan won’t let that happen.

There’s two questions moving forward.
“How is having term limits and prop tax freeze worth holding up the budget and continuing destruction?”

“How is NOT having term limits and prop tax freeze worth holding up the budget and continuing destruction?”

Both sides get to face one of them.

Comment by m Wednesday, Nov 30, 16 @ 1:39 pm
I find it humorous there are so many assumptions that Rauner is done after 2018. That flies completely in the face of the results of this year’s elections. Of course, they probably KNEW Hillary would win, too. Two years is an eternity - as we’ve seen these last two - but more so in politics. First, the Dems need a candidate. That’d be a start.

Comment by LessAnon? Wednesday, Nov 30, 16 @ 1:40 pm
===Spot on if you reverse it.===

Not really…

Rauner put his chips all in on his reforms.

Madigan, seeing the move, “called”

===Both sides get to face one of them===

Nah.

Rauner, like every governor before, and well after him, need budgets.

Rauner also needs the Rauner Tax.

So, now that the Lame Duck Rauner Tax ideal is out there, the pressure is on Rauner…

#TaxHikeMike isn’t going to put votes on a Lame Duck Tax Hike…

… especially when “BossMadigan.Com” exists.

Rauner and the Raunerites might have gone a wee too far.

However, #TaxHikeMike was always going to come back to haunt.

Now it has.

Comment by Oswego Willy Wednesday, Nov 30, 16 @ 1:44 pm
Term limits before budget is a true poison pill. Might be poisoning himself with R legislators as well.

Comment by Robert the Bruce Wednesday, Nov 30, 16 @ 1:47 pm
From the ISC:
“Our economy is and has always been subject to fluctuations, sometimes very extreme fluctuations,” Republican Justice Lloyd Karmeier wrote on behalf of all seven justices. “The law was clear that the promised benefits would therefore have to be paid and that the responsibility for providing the state’s share of the necessary funding fell squarely on the legislature’s shoulders.

“The General Assembly may find itself in crisis, but it is a crisis which other public pension systems managed to avoid and … it is a crisis for which the General Assembly itself is largely responsible,” Karmeier wrote.

Illinois’ unfunded pension systems in five charts
Each of the four Illinois public retirement systems is in deep financial trouble.
“It is our obligation, however, just as it is theirs, to ensure that the law is followed. That is true at all times. It is especially important in times of crisis when, as this case demonstrates, even clear principles and long-standing precedent are threatened. Crisis is not an excuse to abandon the rule of law. It is a summons to defend it,” he wrote.

Comment by illdoc Wednesday, Nov 30, 16 @ 1:47 pm
sorry, din’t get the cut and paste exactly right but you get the idea

Comment by illdoc Wednesday, Nov 30, 16 @ 1:49 pm
Surely the recovering teenage addict with no transitional housing, the abused woman with no shelter and the poor college student with no college will all understand that terms limits are important.

Just. Doesn’t. Get. It.

Comment by Signal and Noise Wednesday, Nov 30, 16 @ 1:56 pm
If a property tax freeze is implemented, does it also prevent lowering of your property tax bill if you successfully contest the valuation?

Comment by RK Wednesday, Nov 30, 16 @ 1:56 pm
illdoc

Maybe I did not make my explanation clear.

Under the separations of powers the court cannot order the legislature to pass a bill to fund any thing the court sees fit.

If Illinois is broke and “there’s no money in the till” pensions will not be funded.

Comment by MOON Wednesday, Nov 30, 16 @ 1:57 pm
===prevent lowering of your property tax bill if you successfully contest the valuation?===

Lemme guess. You write mail for the House Democrats.

lol

Comment by Rich Miller Wednesday, Nov 30, 16 @ 1:59 pm
Illinois will never be “broke.” It will continue to collect taxes. Bond payments and pension payments will be at the top of the list to be paid.

Comment by Demoralized Wednesday, Nov 30, 16 @ 1:59 pm
I almost fell out of my chair when I read “permanent” property tax freeze. Where the heck did that come from?

I think wordslinger hit the nail on the head with this one: “is it just more nonsense words, that sound good, but mean nothing? We’re full up on those, already.”

Comment by Chicago_Downstater Wednesday, Nov 30, 16 @ 2:05 pm
Moon,

Sigh, governments have the ability to raise taxes in order to increase revenue in order to pay their bills. The courts, at any level, will not accept”we’re broke” as an excuse to not pay their bills. They will tell the legislature the remedy is in its taxing authority.

Comment by Casual observer Wednesday, Nov 30, 16 @ 2:07 pm
“Permanent” Property Tax Freeze?

How are ck and Rauner going to sell that to Mayors and School Boards (regardless of their political leaning) who are already fuming at not being paid since Governor Rauner arrived in Springfield?

Comment by illini97 Wednesday, Nov 30, 16 @ 2:09 pm
MJM, your table is ready.

Everything is up to you, big fella!

Comment by PoW Wednesday, Nov 30, 16 @ 2:14 pm
casual

My point is only the legislature has the power to raise taxes if the governor will sign the bill.

The court cannot order the legislature to pass a tax bill.

Comment by MOON Wednesday, Nov 30, 16 @ 2:17 pm
RE the pensions, the IL SC will continue to order what they have consistently ordered in the past: the pensions MUST be paid when due and it is the CHOICE of the GA in how to fund or pay them.

Translation: GA, it’s YOUR problem to find the money. Raise taxes, cut spending, we don’t really care but you DON’T have the choice to not pay.

Comment by RNUG Wednesday, Nov 30, 16 @ 2:24 pm
===Everything is up to you, big fella!===

Except signing the Rauner Tax…

… that #TaxHikeMike isn’t pushing…

So you are now for the Rauner Tax, and you want Madigan to push it?

lol

Comment by Oswego Willy Wednesday, Nov 30, 16 @ 2:25 pm
It looks to me that the chances of any budget for the next 2 years has gone down again.

Comment by Hit or Miss Wednesday, Nov 30, 16 @ 2:30 pm
“How are ck and Rauner going to sell that to Mayors and School Boards” They’re going to have them sign a proclamation and then brag about all of the municipalities that signed on.

Comment by Skeptic Wednesday, Nov 30, 16 @ 2:31 pm
=How are ck and Rauner going to sell that to Mayors and School Boards (regardless of their political leaning) who are already fuming at not being paid since Governor Rauner arrived in Springfield?=

They do not have to, it is pre-sold.

Speaking as a superintendent working for a 7 person board that supports Rauner and Trump unanimously, they soak in the but Madigan stuff pretty good. Sad, because they are nice people. The board that is.

Comment by JS Mill Wednesday, Nov 30, 16 @ 2:44 pm
==Rauner, like every governor before, and well after him, need budgets.==
You keep claiming that no budget was part of the plan all along. SO which is it? He needs one or he doesn’t?

==Rauner also needs the Rauner Tax.==
If Madigan is the obstacle to the tax hike, pressure for that is on him.

==Surely the recovering teenage addict with no transitional housing, the abused woman with no shelter and the poor college student with no college will all understand that terms limits are important.==
Which way? So important it’s worth holding up a budget? Or so important to not have that it’s worth holding up a budget?

Rauner put it down to two things.
If you’re in either camp, you’re saying those two are more important than ending the stalemate, whether you believe it’s important that they do or don’t pass.

Both sides will be putting those two issues above the budget. Like it or not, it goes both ways. If I’m hurting from the budget, I don’t care whether it passes or not, I just want the deal and the budget.

Comment by m Wednesday, Nov 30, 16 @ 2:45 pm
Is the Governor going to propose allocating all or most of the income tax hike to local governments if he gets his permanent property tax freeze? Or will he give them other taxing authorities? Those are the only way a permanent freeze can be made palatable for all those county boards, city councils, village boards, school districts, township boards, etc.

Comment by GA Watcher Wednesday, Nov 30, 16 @ 2:45 pm
You cannot blame a guy who owns nine homes for championing a property tax freeze.

It just means a sales and income tax hike for everyone else.

Oh yeah: let’s not forget that Rauner’s property tax freeze is tied to reductions in the prevailing wage, Operating Engineers.

Comment by Juvenal Wednesday, Nov 30, 16 @ 2:49 pm
== Under the separations of powers the court cannot order the legislature to pass a bill to fund any thing the court sees fit. ==

The IL SC doesn’t have to order the GA to raise taxes. All they have to do is order the Comptroller to pay the valid contract the pensions tepresent … that’s basically what the court said in IFT when they said the pensions must be paid when due.

It’s basically the same as some of the consent orders currently in place that have the Comptroller paying salaries and other services without any authority from the GA.

Comment by RNUG Wednesday, Nov 30, 16 @ 2:59 pm
===You keep claiming that no budget was part of the plan all along. SO which is it? He needs one or he doesn’t?===

Need.

Want.

Governors need budgets. Governors.

Rauner doesn’t feel a need for a budget, or a want for a budget, if only… to destroy labor by hurting social services.

So… Rauner in 2012 (if you want, I’ll get the quote for you) made it clear, wants of destroying labor are helped by no budget and hurting all social services… less The Ounce.

So… A Governor needs a budget, Rauner now wants a budget to… wait for it… Property Tax (Labor destroying) “Relief” and Term Limits.

Hysterical.

===If Madigan is the obstacle to the tax hike, pressure for that is on him.===

Nah.

For the Rauner “sham” to actually work, Rauner needs the Rauner Tax, and #TaxHikeMike to destroy Labor with the Property Tax (Labor Destroying) Relief AND Term Limits AND vote FOR the Rauner Tax.

That’s even MORE comical.

===Which way? So important it’s worth holding up a budget? Or so important to not have that it’s worth holding up a budget===

So it’s Rauner holding the budget hostage?

“Give me or nothing?”

Hmm… You’re saying yourself, give in to 3 bad votes to “discuss” a budget? Oh boy, lol

===If you’re in either camp, you’re saying those two are more important than ending the stalemate, whether you believe it’s important that they do or don’t pass.===

Nah, either you’re Diana Rauner looking to take of your own and hope Social Services fail, or you vote against your better selves AND raise taxes with the help of #TaxHikeMike AND expect “BossMadigan.Com” to pummel after too.

The governor? “He’ll be fine”…

Rauner could just find 60 and 30 on his own… You ignore that one every time.

Comment by Oswego Willy Wednesday, Nov 30, 16 @ 3:02 pm
Sometimes, when you have a tiger by the tail, you find out that the tiger has you.

Comment by Anonymous Wednesday, Nov 30, 16 @ 3:10 pm
- A Jack - Wednesday, Nov 30, 16 @ 1:02 pm:

How many people still don’t realize that the Federal Constitution does not allow states to declare bankruptcy?”

Apparently a lot of people don’t. I have noted this many times to others and I usually get a big blank dumb stare and no response.

Of course many can not even name their Congressional Rep or two Senators. So much for the theory that everyone should vote.

Comment by Federalist Wednesday, Nov 30, 16 @ 3:18 pm
Sorry, please don’t yell at me, how does the property tax freeze kill the union? Because the local governments could no longer afford the employees?

Comment by JohnnyPyleDriver Wednesday, Nov 30, 16 @ 3:23 pm
== Sorry, please don’t yell at me, how does the property tax freeze kill the union? ==

The previous property tax freeze proposals have included either “right to work” provisions or “removal of prevailing wage” provisions. Most people would consider those poison pills as anti-union.

Comment by RNUG Wednesday, Nov 30, 16 @ 3:32 pm
States cannot seek the protection of Federal bankruptcy court. However, they can be unable to pay their debts, which in lay terms is bankruptcy.

Comment by Last Bull Moose Wednesday, Nov 30, 16 @ 3:41 pm
Didn’t Madigan at one point signal a willingness to freeze property taxes and Rauner said he wouldn’t agree to it without also allowing “right to work” zones? I seem to remember something like that happening last year sometime.

Comment by Twirling Towards Freedom Wednesday, Nov 30, 16 @ 3:42 pm
== term limits and a permanent property tax freeze ==

The soonest a term limits measure could appear on the ballot is Nov. 2018, so it wouldn’t limit anyone prior to 2027. How would that help the budget?

A permanent property tax freeze also does nothing for the state budget, though it would put non-home rule units of local government in a vise.

Comment by anon Wednesday, Nov 30, 16 @ 3:44 pm
This is what I was remembering. That Google machine works wonders:

http://m.huffpost.com/us/entry/7950118

Comment by Twirling Towards Freedom Wednesday, Nov 30, 16 @ 3:53 pm
Ah, right ok got it. I definitely know the connection between RTW and prevailing wage and the union. Either forgot or didn’t realize that was part of the tax freeze

Comment by JohnnyPyleDriver Wednesday, Nov 30, 16 @ 3:59 pm
Governor Rauner knows with the new Republican administration in Washington he can expect to see his total aggregate budget costs for human services decline. In particular Seema Verma, Trump’s proposed pick for the head of the Centers for Medicare and Medicaid Services will push down Rauner’s mandated costs for Medicaid. The Healthy Indiana Program which Verma designed drove down costs for the State by charging premium-like payments to these poor recipients of Medicaid services, I have no doubt Governor Rauner supports that vision. There will be numerous other cost savings for the States coming out of DC

Governor Rauner’s complete delaying tactics and high stakes demands are based on the reality that things will get worse and worse for the Democrats in Illinois as they watch the DC Democrats cave on reform after reform driven by a radical right agenda. It was predictable that there would be no budget deal in the veto session, and possibly not in the next few months either. The future looks tough for the poor of Illinois, national elections have their consequences.

Comment by Rod Wednesday, Nov 30, 16 @ 4:34 pm
Stop Gap Budget? Huh? last time we heard this phrase was about May 30…. blink twice and BigBrain was signing a bill.
First they blow the Rauner Lame Duck Tax Hike.
Then they role out another stop gapper.

Comment by Annonin' Wednesday, Nov 30, 16 @ 4:34 pm
MOON and others have said that the Governor, GA, etc. can simply let the funds go insolvent. Unfortunately, in the latest pension ruling involving Chicago, Emanuel tried to use that reasoning to cut benefits. He said that the funds will become insolvent by such and such date if he wasn’t allowed to cut benefits. The ILSC clearly stated that the funds solvency is not the issue. The money must be paid regardless of where it comes from whether it be new taxes, cuts, etc.

Basically, they’re not going to be able to weasel out of the payments no matter how loud you bang that drum.

Comment by CrazyHorse Wednesday, Nov 30, 16 @ 4:41 pm
To add a little bit to RNUG’s spot-on comments re:pension funding, the funds don’t need a consent decree or anything else to get paid.

They have continuing appropriation authority to be paid as specified by the Edgar/Netsch ramp and don’t need a budget in place to get paid. Cash shortages are not their problem, just like with bond holders.

I suppose someone could challenge this in court, but their odds of success are right there with the Speaker’s SB1-DOA.

Comment by Arthur Andersen Wednesday, Nov 30, 16 @ 4:46 pm
@CrazyHorse - Michigan’s constitution specifically protected pension obligations and Detroit was able to reduce their pension obligation in their bankruptcy. The 6th Circuit upheld the pension reduction last month. Now obviously all this would require the state to pass a municipal bankruptcy law and Chicago is certainly not in the same boat as Detroit was, but never say never.

Comment by Chicagonk Wednesday, Nov 30, 16 @ 5:00 pm
Moon ==My point is only the legislature has the power to raise taxes if the governor will sign the bill.

The court cannot order the legislature to pass a tax bill.==

Actually, a federal court did order the Kansas City property taxes to be increased to pay for required school funding. But, more to the point and as others have pointed out in different language, the Illinois courts have ordered payments required by the constitution to be made even without appropriation. Unless the state repeals its tax laws, there will be cash available and the constitutionally-required payments will take priority. Legislators, judges, executive branch officers and retirees will be paid before current employees (who may have to be laid off if there is no money to comply with federal labor law) and vendors and anyone else who doesn’t have constitutional priority.

Comment by Anonymous Wednesday, Nov 30, 16 @ 5:29 pm
== Michigan’s constitution specifically protected pension obligations and Detroit was able to reduce their pension obligation in their bankruptcy. ==

A) Michigan’s pension clause is nowhere near as powerful or airtight as the Illinois clause is. Only the NY and AZ clauses are equivalent.

B) As you acknowledge, the State allowed municipal bankruptcy, something Illinois does not currently allow.

C) Not really on the reduction. When the court ordered the Detroit Art Museum collection sold off to fund the pensions (something the people cheering the bankruptcy on didn’t expect), local patrons all of a sudden found a whole bunch of money to throw in the pension fund. Pensioners walked off a whole lot better than all the other debtors. Not whole, but not that bad.

And it was clear that the court was going to sell off ALL the Detroit assets that it needed to in order to pay the city’s debts. The court wasn’t going to cherry pick just the pensions to discharge like some people were aiming for.

Bankruptcy falls into that “be careful what you wish for” category because you can’t predict the results.

Comment by RNUG Wednesday, Nov 30, 16 @ 5:32 pm
Court: the legislature can raise revenue with its taxing authority.

AG: but, your honor, the legislature is unable to garner enough votes to raise taxes. And if they did there would be no guarantee the governor would sign it.

Is this the checkmate we’ve been waiting for?

Comment by Casual observer Wednesday, Nov 30, 16 @ 6:10 pm
“The property tax issue is relevant. ”

I sure the public schools and local governments would disagree with that statement.

Comment by Anonymous Wednesday, Nov 30, 16 @ 6:45 pm
Enacting “term limits” solves nothing. The only reason Rauner wants ‘term limits’ is to change Illinois from a Democratic state to a Republican state. Its all about politics.

Comment by Anonymous Wednesday, Nov 30, 16 @ 7:00 pm
== Court: the legislature can raise revenue with its taxing authority.

AG: but, your honor, the legislature is unable to garner enough votes to raise taxes. And if they did there would be no guarantee the governor would sign it. ==

Court: That’s not OUR problem, that’s YOUR problem!

Comment by RNUG Wednesday, Nov 30, 16 @ 7:02 pm
“Actually, a federal court did order the Kansas City property taxes to be increased to pay for required school funding”
————-
Yes, but that was in direct result to a federal desegregation lawsuit. Had nothing to do with pensions.

Also, it’s pretty clear that the judiciary runs from getting involved with the whole taxation/raising revenue aspect of court cases. They don’t want to get near that. Even from the federal bench.

You would be asking the courts to move into the Administrative areas (raising revenues), and the few (very few) times they have done it (KC is one of them, Rockford, IL public schools is another one), well, it has not worked out well for them.

The most likely outcome is for the courts ending up tossing it back to the locals. Your mess, you fix it.

Said it before and will repeat it. Watch for how the Commonwealth of Puerto Rico handles their fiscal situation (a real mess). Actually, how the federal government is going to provide for Puerto Rico to handle their fiscal mess.

Get your popcorn and kick back and watch. Going to be interesting.

Comment by Anon Downstate Wednesday, Nov 30, 16 @ 7:04 pm
How about we limit Rauner to one term?

Comment by Anonymous Wednesday, Nov 30, 16 @ 7:21 pm
This whole thing is about who has to ask for the tax increase (or closing loopholes) we all know has to eventually happen, and who gets blamed for it.

Rauner is angling to get MJM and the D’s blamed for it.

Never sure what MJM is thinking, but my guess is he wants Rauner to take the blame since, as OW reminds us, Governors own.

If not the Gov, I suspect MJM may settle for another unconstitutional pension bill hoping to create an order from the IL SC that can be spun as the court leaving no choice but a tax increase.

The court is going to uphold the IL Constitution but will not order the GA to raise taxes. The most the court will do is note the choices, reduced spending or increased revenue. They don’t want the blame.

And that, in a nutshell, are the pieces of this impasse.

Somebody should do a caricature T-shirt of the three parts, with each side pointing at the other two. If someone does, I want one in 3XL as payment.

Comment by RNUG Wednesday, Nov 30, 16 @ 7:24 pm
I don’t know what the numbers are, but I don’t support term limits. Then only rich people would be in Gov’t. Most private sector folks can’t just take a 4 year term out mid-career.

Comment by burbanite Wednesday, Nov 30, 16 @ 8:24 pm
(Who predicts anything after Trump) but I do not see the Turnaround Agenda being enacted using this budget precondition strategy. The constitution does not have this “software bug”. But the repetition is depressing.

Comment by peon Wednesday, Nov 30, 16 @ 9:00 pm
I’ve said this before but anyone who thinks Rauner’s turnaround agenda is not related to the budget also believes in insanity. I.e., doing the same thing over and over again without changing anything.

Comment by justacitizen Wednesday, Nov 30, 16 @ 9:15 pm
–I’ve said this before but anyone who thinks Rauner’s turnaround agenda is not related to the budget also believes in insanity. –

Please describe the relationship.

1. Term limits relationship to the budget.

2. Property taxes relationship to the budget.

Remembers, budgets are communicated in numbers — revenue and spending.

Comment by wordslinger Wednesday, Nov 30, 16 @ 9:18 pm
The turnaround agenda is the vessel (Pequod) used by Governor Rauner to sail the high seas to hunt down his Moby Dick (unions).

Budgetary impacts are secondary and small (1.4%; previous reporting). We deserve better.

Comment by peon Wednesday, Nov 30, 16 @ 9:58 pm
== Please describe the relationship. ==

-Wordslinger-, I know this wasn’t directed at me, but I’m going to answer anyway in non-monetary terms …

1. Term limits relationship to the budget.

It means instead of your Representative or Senator knowing their way around the legislative process and having some informed input into the budget, it will be drafted by either (a) the Governor and his staff or (b) the lobbyists assisting the House and Senate members or (c) the legislative aides assisting the various legislators. It shifts the power of the purse from the elected officials to un-elected people working behind the scenes (much more so than today).

2. Property taxes relationship to the budget.

Assuming (that’s a big IF based on past rulings, but the court might be inclined to revisit the issue in the case of a state imposed freeze) the IL SC upholds a case asking for the State to be the primary source of K-12 education funding, it means that State income taxes or State & Local sales taxes will have to be increased proportionally by the amount that local property taxes are cut or frozen in the future.

Comment by RNUG Wednesday, Nov 30, 16 @ 10:19 pm
==Court: That’s not OUR problem, that’s YOUR problem!==
At that point, does it become “ILSC’s tax hike”? Seriously, ss there a provision in the constitution that covers legislative and gubanatorial deadlock? Can the courts step in and take over, or can the Governor invoke some sort of emergency power? Or are we in such uncharted waters, that it is TBD?

Comment by Tom K. Thursday, Dec 1, 16 @ 2:42 am
===a provision in the constitution that covers legislative and gubanatorial deadlock?===

How about, you know, try reading it?

Comment by Rich Miller Thursday, Dec 1, 16 @ 7:27 am
Simple fact, the state of Illinois needs a budget with cuts and revenue. It is the number one problem facing the state of Illinois. The Dems stand ready to negotiate and pass a budget and it is Rauner that is insisting on reforms before a budget. If you house is burning, you put out the fire and then discuss improvements to the home.

Comment by facts are stubborn things Thursday, Dec 1, 16 @ 8:04 am
Where are the votes going to come from for the Rauner Tax Increase? Rauner went after the democrats with millions are they going to vote for something that he can use against them in 2018, think not! The budget is going to be settled with severe cuts.

Comment by reasonable Thursday, Dec 1, 16 @ 8:12 am
I think the new Comptroller should announce that no one gets paid and the government shuts down on January 1st. That would be checkmate for all concerned.

Comment by Chucktownian Thursday, Dec 1, 16 @ 9:57 am