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* O’Connor…
The Illinois Senate is poised to go it alone in outlining a solution to the nation’s longest-running state budget standoff but leaders acknowledge they won’t have time to push it through to the governor in the final two days of the current session.
A bipartisan Senate deal began to emerge late last week with a goal of breaking the nearly two-year deadlock between Democrats who control the Legislature and Republican Gov. Bruce Rauner. It was positioned for a floor vote by late Monday, but since the session ends Tuesday, there’s no time to push the plan to the House. It would have to be reintroduced after a new General Assembly is seated Wednesday.
The package includes an increase in the personal income tax from 3.75 percent to 4.95 percent, borrowing money to pay off $11 billion in overdue bills, expanding legalized riverboat casino gambling, raising the minimum wage and eliminating pensions for retired lawmakers.
The Senate has been largely sidelined during the seeming test of wills between former venture capitalist Rauner and Michael Madigan, the Chicago Democrat who has run the House for most of three decades. But the Senate plan hasn’t involved the House, and is the result of weeks of talks between Democratic Senate President John Cullerton and Republican Leader Christine Radogno.
* Sfondeles…
Madigan spokesman Steve Brown said the package appears to “not yet be complete.”
“Until you have a complete package, it’s hard to even analyze, no less decide what works,” Brown said.
Brown also questioned the package as a whole: “That means you could take some precarious votes and if other things don’t pass for whatever reason, then you’re out there walking the plank.”
Brown instead encouraged the Senate to take up a House measure to fund higher education and social services, which was approved Monday 63-49.
Not exactly a substantive objection.
And since the House apparently doesn’t have the votes to override a Rauner veto of its stopgap budget, why would the Senate go along?
* Finke…
Senate Republican Leader Christine Radogno, who negotiated the bills with Cullerton, said Monday she hopes the legislation can pass the Senate before Feb. 1.
“I think we in the Senate recognize the problems and we are potentially close to an agreement on how to solve them. But we are not quite there,” Cullerton, a Chicago Democrat, said at a Statehouse news conference.
“One of the big takeaways from this is for the first time we’re acknowledging that we really do need to link the reforms, the revenue and the budget all together,” said Radogno, of Lemont. […]
“There was some resistance to the lame-duck aspect of this,” Radogno said. “We are often criticized for doing things too quickly.”
She said some senators only learned details of the package Monday. She said the concerns were “primarily” about the timing rather than the substance of the bills.
There were some substantive problems as well.
“None of this could ever become law, so today is somewhat irrelevant. But I think, in essence, we’ve made our point,” said Sen. Jason Barickman, R-Bloomington. “I think it puts the onus on both Speaker Madigan and Gov. Rauner.” […]
“At some point the campaign has to end. There is no ability to govern if you never stop campaigning,” said Sen. Toi Hutchinson, D-Olympia Fields. “At this point, doing anything less is unconscionable. We cannot go another two years like this.” […]
Cullerton, meanwhile, was left to explain why Democrats would go along with the compromise after spending years objecting to Rauner’s attempts to tie the budget to his legislative agenda.
“We’re two years into this, we don’t have a budget,” Cullerton said. “It’s an embarrassment for the state.”
Ain’t that the truth.
* Mackey…
That said, there’s plenty of skepticism among rank-and-file legislators like Dale Righter, a Republican senator from Mattoon.
“If legislators come to the … taxpayers and say, ‘You know what, we just need a big tax increase, and we’ll tweak the curtains here and a little bit over here, but nothing substantive changes,’ I think that there’s going to be a rude awakening,” Righter says.
You get what you can get, and I think Radogno did a pretty decent job here. There will be some changes, for sure, but my hat’s off to the Leader.
* Vinicky…
Rauner took umbrage with the notion that he (and Madigan) have been “cut out” of talks.
He laughed at the question, then said “Well, I don’t know if I’d say ‘cut out’ if the right word. […]
“I don’t need to be in the middle of everything,” he said.
Maybe this is his “Eureka!” moment. But don’t hold your breath. He has to be in the middle of everything. It’s his nature.
* Petrella…
The package that was introduced Monday in the Senate would increase the state’s personal income tax rate from 3.75 percent to 4.95 percent and the corporate rate from 5.25 percent to 7 percent. Another component would provide an additional $740 million in funding for social services and $1.1 billion for higher education for the remainder of the state’s current fiscal year.
The Senate also is considering legislation that would authorize borrowing $7 billion to help pay down the state’s backlog of unpaid bills, which currently stands at $11 billion.
Also included are pension reforms that Cullerton has advocated, an increase in the state’s minimum wage from $8.25 an hour to $11 an hour by 2021, and changes that would make it easier to consolidate units of local government.
A gambling expansion measure would create licenses for six new casinos, including one for the proposed Walker’s Bluff resort and casino in southern Illinois’ Williamson County and another for the south suburbs of Chicago.
The final package also could include changes to the state’s workers’ compensation laws, a referendum on amending the Illinois Constitution to limit lawmakers to 10 years in top legislative leadership positions, and an overhaul of the way the state funds public schools.
posted by Rich Miller
Tuesday, Jan 10, 17 @ 9:40 am
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Borrow $7 billion to help pay down overdue bills? When Quinn proposed to borrow less than that to pay down overdue bills, the GOP said “No way, Jose!”
Comment by anon Tuesday, Jan 10, 17 @ 9:48 am
===the GOP said “No way, Jose!” ===
Yep. But times change. You gonna flip-flop now because the GOP is for it?
Comment by Rich Miller Tuesday, Jan 10, 17 @ 9:51 am
Great work by the Senate leaders. I wonder whether they also agreed to supply the same percentage yes votes.
Comment by Robert the Bruce Tuesday, Jan 10, 17 @ 9:56 am
Is there any provision for slots at the race tracks?
Comment by Big Joe Tuesday, Jan 10, 17 @ 9:57 am
It’s not quite soup yet, but the ingredients are there.
One question I have is the exact language to term limit the leadership positions; will it be 10 years total or just 10 consecutive years, with more years allowed after a one term gap?
Hope they don’t count any pension savings in the budget numbers; I think the proposal is legally questionable.
And personally, I’d like to see a progressive income tax amendment in the mix.
Comment by RNUG Tuesday, Jan 10, 17 @ 9:58 am
Does anyone know the language of the pension reform? Having a hard time finding anything.
Comment by Fixer Tuesday, Jan 10, 17 @ 10:03 am
What happened to the tax on soft drinks? If the state piles on with its own tax, Chicagoans will be paying state, county and city taxes for soda pop.
Comment by Super Big Gulp Tuesday, Jan 10, 17 @ 10:03 am
I’ve long felt that Cullerton is the best example of an adult in the room at the budget talks. Maybe he should be our next gubernatorial candidate. What, you say? He’s not rich and spoiled, you say? Exactly.
Comment by Dome Gnome Tuesday, Jan 10, 17 @ 10:04 am
And you ain’t black.
Comment by Lol Tuesday, Jan 10, 17 @ 10:13 am
This package is exactly the “Rauner cave, with some face-saving olive branches” Madigan’s backers were predicting a year ago. I can understand why Rauner would fold, try to win some more GOP seats and reelection, try again later. But I can’t imagine why Madigan would block a package like this.
Comment by lake county democrat Tuesday, Jan 10, 17 @ 10:15 am
Leader Radogno did a great job - and I think that President Cullerton and she generally work okay together - but I am curious how many of her caucus members will vote for a tax increase.
Comment by Team Sleep Tuesday, Jan 10, 17 @ 10:17 am
Can we stop using ‘adult in the room’ phrase? Cmon, New Years Resolution. Any others you can think of would be swell, too.
Comment by Anonymous Tuesday, Jan 10, 17 @ 10:17 am
>Can we stop using ‘adult in the room’ phrase? Cmon, New Years Resolution. Any others you can think of would be swell, too.
I’ll briefly join you in OT land. One I’d like would be: resolve to make up a name instead of “Anonymous.”
Comment by Earnest Tuesday, Jan 10, 17 @ 10:21 am
=== you gonna flipflop now because the GOP is for it? ===
I thought borrowing to pay off bills made sense when Quinn proposed it, and I still do. The flipfloppers are the Republicans who blasted borrowing to pay down bills when the governor was a Democrat.
Speaking of flipflopgs, I can’t wait to see Republicans voting for more taxes than Democrats enacted. Back then, we were lectured about how bad for business and the economy it is to raise taxes. We were told over and over that “Illinois has a spending problem, not a revenue problem.”
Comment by anon Tuesday, Jan 10, 17 @ 10:21 am
Appreciate Petrella’s recap the most. There’s something in there”for” and “agin” everyone. I’m optimistic about the framework. They did a very capable job with this. There are plenty of people in both chambers who want to get paid too. Every ounce of leverage is helpful.
Comment by A guy Tuesday, Jan 10, 17 @ 10:22 am
–The idea, they said, was to jump-start stalled negotiations and send a message to the Republican governor and Democratic House Speaker Michael Madigan that the Senate would no longer stand idly by while they duke it out.–
Does that mean Radogno and Senate Republicans believe they can and will act independently of what the governor wants? If so, when did that epiphany occur?
Or are Senate Republicans being used to probe for possible areas of compromise, while allowing Rauner to keep his distance?
Comment by wordslinger Tuesday, Jan 10, 17 @ 10:29 am
===Or are Senate Republicans being used to probe for possible areas of compromise, while allowing Rauner to keep his distance? ===
From what I know of how it went down, no. But, even if I’m wrong, would that be such a horrible thing?
Comment by Rich Miller Tuesday, Jan 10, 17 @ 10:32 am
== Does anyone know the language of the pension reform? Having a hard time finding anything. ==
Link was posted yesterday. See current SB-17. It will probably be a different number tomorrow.
Comment by RNUG Tuesday, Jan 10, 17 @ 10:36 am
Borrowing billions to pay back debt is what makes a budget balanced. That’s the ticket!
Comment by H.L. Mencken Tuesday, Jan 10, 17 @ 10:36 am
This is the second day in a row that Rauner has laughed when asked a question related to the impasse.
People are hurting and he laughs.
Comment by Sir Reel Tuesday, Jan 10, 17 @ 10:37 am
====Borrowing billions to pay back debt is what makes a budget balanced===
It’s either that or raise taxes even higher to pay off the debts to small businesses and not for profits right away. Which do you prefer?
Comment by Rich Miller Tuesday, Jan 10, 17 @ 10:40 am
So this has the potential to break the stalemate between Rauner/Madigan that part I get. As for keeping Illinois attractive to individuals and companies the “Grand Bargain” would be a Pyrrhic victory ….”The package ….would increase the state’s personal income tax rate from 3.75 percent to 4.95 percent and the corporate rate from 5.25 percent to 7 percent”
Comment by Lech W Tuesday, Jan 10, 17 @ 10:42 am
All fun stuff this speculating is until a structured roll call is truly assembled. Those tax increases (plural) are a real tough pill to swallow for the GOP in both Chambers … and the proposed reforms were kinda light.
Count me as skeptical this is more than an illusory marker; one easily dissembled by Madigan and misused by Rauner.
A grand bargain only happens when all are talking and the political sniping is in abeyance.
In sum, we’ll see if this moves the needle or is another false positive.
Comment by Deft Wing Tuesday, Jan 10, 17 @ 10:45 am
–From what I know of how it went down, no. But, even if I’m wrong, would that be such a horrible thing?–
No, just curious.
Comment by wordslinger Tuesday, Jan 10, 17 @ 10:57 am
=== Maybe he should be our next gubernatorial candidate===
One-word response from Patterson: NO!
lol
Comment by Rich Miller Tuesday, Jan 10, 17 @ 10:58 am
So personal income tax rates increase by 32%, corporate taxes increase by 33% in an environment where Illinois in already uncompetitive with adjacent states, there’s nothing in cost control, limitations of union power in the public OR private sector, and NO sacrifice included for public sector workers, unions, or the political class. There’s no reform to limit college benefits to students for whom their majors will not be in an area that Illinois needs to grow, no protection form overpaying for public sector labor through prevailing wage, and no protection for taxpayers and the children and control unconscionable cost increases by prohibiting public sector strikes. Will the last private sector taxpayer in Illinois please not forget to turn off the lights?
Comment by Illinois Bob Tuesday, Jan 10, 17 @ 11:01 am
H.L. - if the bonds/borrowing do not carry usury-level rates I think that makes sense.
Comment by Team Sleep Tuesday, Jan 10, 17 @ 11:01 am
–Borrowing billions to pay back debt is what makes a budget balanced. That’s the ticket!–
Sigh. This ain’t rocket science.
You’re already borrowing the money from vendors, and paying more in juice with late payments.
It was a good idea when Quinn proposed it and the GOP blocked it. If GOP members have seen the light, it’s still a good idea.
Getting square with a new baseline on bill payments and pumping those billions owed to Illinois vendors into the economy would do more good than ten Turnaround Agendas.
You’d put the clouted, vulture debt buyers out of business, too.
Comment by wordslinger Tuesday, Jan 10, 17 @ 11:05 am
=== There’s no reform to limit college benefits to students for whom their majors will not be in an area that Illinois needs to grow ===
And who gets to decide what majors Illinois needs to grow?
A bureaucratic committee? AFSCME? The Governor?
Sounds like socialism to me.
Comment by Crosstab Tuesday, Jan 10, 17 @ 11:08 am
===and NO sacrifice included for public sector workers, unions, or the political class===
You must not know how to read. There’s stuff in the property tax cap on public unions, plus there’s workers’ comp reform and term limits for leaders.
Take a freaking breath.
Comment by Rich Miller Tuesday, Jan 10, 17 @ 11:17 am
For - Illinois Bob -
“Because… teachers”
… that and anything against Labor.
If he/she would’ve read, a Labor prong exists.
Comment by Oswego Willy Tuesday, Jan 10, 17 @ 11:19 am
=== I wonder whether they also agreed to supply the same percentage yes votes===
Subscribe.
Comment by Rich Miller Tuesday, Jan 10, 17 @ 11:25 am
Sounds like pension reform is a “kick the can” down the road to make it look like they did something. They will never face that they are going to just have to pay the bill.
Comment by sparky791 Tuesday, Jan 10, 17 @ 11:37 am
The borrowing to pay down the backlog is a good idea. It’s my understanding the the state pays penalties on this backlog of from 9-12 %. That said it should have been done several years ago when they could have gotten a much more favorable interest rate.
Comment by oldman Tuesday, Jan 10, 17 @ 11:42 am
Is the property tax freeze still going to be included in this party?
Comment by BK Bro Tuesday, Jan 10, 17 @ 11:42 am
Rich,
You left out the best part (for me) of Finke’s article:
“Neither Madigan nor Rauner was involved in negotiating the bills that Cullerton and Radogno want to pass.”
Comment by WhoKnew Tuesday, Jan 10, 17 @ 11:44 am
I can’t believe Radogno calls herself a Republican by pushing an increase in the minimum wage. Businesses are struggling from all the mandates, fees and taxes and now she wants to jack up labor costs in a bargain with the Democrats. This could simply drive more businesses away, reducing tax revenues even further.
Comment by Muscular Tuesday, Jan 10, 17 @ 12:09 pm
More Gambling huh? I thought the 1000’s of Video Poker positions would be enough. Who is going to patronize these casinos? Especially the one at Walkers Bluff? I doubt people are going to fly from all over the country to St. Louis then shuttle an hour and a half to Walkers Bluff for a conference. I guess Cindy Bunch will get her play land.
Comment by Saluki Tuesday, Jan 10, 17 @ 12:22 pm
Raising minimum wage is one way to generate a bit more consumer spending. The people who will get the raises are mostly living on the edge and will immediately spend it. A percentage of it will immediately come back to the State in the form of income and sales tax revenue.
It’s better than corporate tax breaks that will either get saved by the company or distributed to wealthy stockholders (or retirement accounts that hold the stock) who will most likely also save it rather than spend it.
Comment by RNUG Tuesday, Jan 10, 17 @ 12:35 pm
Good article explaining SB17 found here
http://pension-vocabulary.blogspot.com/2017/01/sb17-eric-madiar.html
Comment by Mod Dem Tuesday, Jan 10, 17 @ 12:40 pm
- Mod Dem -
That’s a good, short English language explanation.
Comment by RNUG Tuesday, Jan 10, 17 @ 12:45 pm
CASH BONUS of 10% of contributions for those accepting changes to COLA included in pension bill
Comment by pension guy Tuesday, Jan 10, 17 @ 1:02 pm
Tin foil hat time - there are structured roll call to pass the budget with significant/majority republican votes in both chambers. 1.4% wiffles and waffles but ultimately vetos the bill because it doesn’t include enough of his agenda.
Comment by Huh? Tuesday, Jan 10, 17 @ 1:06 pm
==CASH BONUS of 10% of contributions for those accepting changes to COLA included in pension bill ==
And that money will come from where?
Comment by Joe M Tuesday, Jan 10, 17 @ 1:07 pm
Out of funds “appropriated for that purpose under Section 1.9 of the State Pension Funds Continuation Appropriation Act”
Comment by pension guy Tuesday, Jan 10, 17 @ 1:13 pm
== CASH BONUS of 10% of contributions for those accepting changes to COLA included in pension bill ==
And some people say the current value of the AAI you are giving up is about 30% …
Comment by RNUG Tuesday, Jan 10, 17 @ 1:20 pm
== Out of funds “appropriated for that purpose under Section 1.9 of the State Pension Funds Continuation Appropriation Act” ==
As I noted yesterday, that shorts the FY19 pension fund(s) contributions.
Comment by RNUG Tuesday, Jan 10, 17 @ 1:22 pm
It’s not the right decision, but some (maybe many) would love it. Buy a car, pay tuition, etc…
Comment by pension guy Tuesday, Jan 10, 17 @ 1:23 pm
After reading the pension bill and running the numbers there is no way the considerations the state offer come close to being “equal or greater” than the status quo. And yes, the state is allowed to set and determine what constitutes salary, to a certain extent. This authority is governed by labor laws and labor agreements. Based on the strong reaction of the ILSC to the last pension bill, I see this as being DOA. Even Madiar in the link states SB-17 lacks a significant caveat, the ability to choose the status quo.
Comment by Han's Solo Cup Tuesday, Jan 10, 17 @ 1:25 pm
== there is no way the considerations the state offer come close to being “equal or greater” than the status quo. ==
Strictly from a contractual modification standpoint, it doesn’t have to be equal or greater, it just has to be SOME consideration. caveat emptor.
But the lack of status quo is a problem. You can decide to not give a raise so the pensions won’t increase, but the way I see it, if you do give a raise it has to be pensionable. And you can play games with the language calling it something else, but if the IRS says you have to pay SS taxes on it, then I’m betting our courts will call it a pensionable raise.
Comment by RNUG Tuesday, Jan 10, 17 @ 1:35 pm
This stuff about President Cullerton being the big boy in the room is worn out as others have noted and also saying how President Cullerton is not a rich guy is equally mind bending as one post today did. Thompson Coburn, LLP a firm of more than 360 lawyers of which President Cullerton is a partner makes good money and so does Senator John Cullerton. By the way the firm does property tax appeals and John’s youngest brother Patrick is the head of that division.
There is no evidence President Cullerton is a crook, and probably none that he is a saint either. His pockets are not anywhere as deep as Governor Rauner’s are, but he isn’t a struggling man either. He has always been a respectful legislator and in today’s harsh political world that is a good thing. As to the great package of agreed bills, once the bills are refiled if they are all co-sponsored by Senator Christine Radogno it will add some credibility to the grand compromise idea because she will be one the line for what is in those bills.
Senator Radogno’s constituents in Lemont may not be thrilled with the evidence based school funding reform proposal that could include a Professional Judgment Panel that will play a role in what dollars districts get, some increased powers for the State Superintendent of Schools in terms of state educational dollar distribution, and a complex local capacity calculation that could turn against school districts like 113a from Radogno’s district that are currently funding almost 86% of the total costs for the school district out of property taxes. It’s one thing to throw in school funding reform into this mix, it’s another altogether once actual dollar distributions are calculated and become known. There are many mine fields out there and providing both good schools and property tax relief for Sen Radogno’s constituents is a big mine field patch indeed.
Comment by Rod Tuesday, Jan 10, 17 @ 2:23 pm
@Rich and @OW
I read it, guys. Here’s what I read:
“compensation reform, term limits, a property tax freeze and changes to state retirement plans. Madigan has argued those items should be considered separately from the budget, saying several of those changes would undermine unions and hurt workers.”
I read that as meaning it ain’t happenin’ in this legislation. Maybe you’re smarter than me and read more into that that’s not stated.
Also, that “property tax freeze” is as much of a scam as “tax caps” were. Schools can exceed those “limits” by selling working cash bonds and directly adding the bond repayment to the tax bills. It’s practically impossible to get those increases on the ballot by petition. “Life safety bonds” can be sold and the costs directly added to the tax bills as well. All it takes is an architect to say something like adding air conditioning to a school closed all summer is a “safety” issue, and state approval, and there’s an uncapped tax increase. If you guys don’t know this, perhaps YOU should do a little more reading.
Comment by Illinois Bob Tuesday, Jan 10, 17 @ 2:24 pm
Agreed, but the consideration has to be reasonable to be legally acceptable.
Comment by Han's Solo Cup Tuesday, Jan 10, 17 @ 2:50 pm
No increase in the tax rate, without cuts in spending, and reforms. Or the Democrats will be back in a few years, asking for even bigger tax increases
Comment by Anonymous Tuesday, Jan 10, 17 @ 2:54 pm
This is not really work comp reform.
Comment by Blue dog dem Tuesday, Jan 10, 17 @ 3:03 pm
==Those tax increases (plural) are a real tough pill to swallow for the GOP in both Chambers … and the proposed reforms were kinda light.==
This seems true. As I’m not a Republican, I’m thrilled. But in general, Republicans don’t vote for things that thrill me.
Comment by Arsenal Tuesday, Jan 10, 17 @ 3:04 pm
@RNUG 1:35 ==And you can play games with the language calling it something else, but if the IRS says you have to pay SS taxes on it, then I’m betting our courts will call it a pensionable raise.==
SURS,TRS,and some others are not in social security.
Comment by DuPage Tuesday, Jan 10, 17 @ 4:44 pm
-Dupage-,
Some members of SURS are in SS, as are most SERS.
The point I was making was if the IRS counts the increase as “salary”, the courts probably would also for the purpose of pension calculations.
Comment by RNUG Tuesday, Jan 10, 17 @ 5:10 pm
RNUG, yes I agree, anything on a W-2 is usually considered salary either with SS or not. There is also something called “safe harbor” that I don’t know the exact details of. It is supposed to ensure a pension is at least as good as social security. Social security counts raises, so I think the pensions would HAVE TO also count any raises.
Comment by DuPage Tuesday, Jan 10, 17 @ 6:24 pm