Latest Post | Last 10 Posts | Archives
Previous Post: The damage done
Next Post: It’s just a bill
Posted in:
* As we’ve already discussed, the governor’s budget would essentially short state pension payments by $1.1 billion next fiscal year and several years into the future.
Carol Marin asked lawmakers last night if the governor was trying to skip state pension payments or not. Senate Majority Leader Kimberly Lightford…
Well, I hope that isn’t the desired goal. I’m hoping we could look at some of those ideas that you’ve mentioned [cannabis, gaming, etc.] to generate revenue so that we don’t have to do that.
Trouble is, the money from all those revenue proposals are already being spent. I suppose he could use projected sales tax revenue from cannabis, sports betting and a new graduated tax on video gaming to cover pension payments, but will that be enough? I don’t think so.
* Marin then asked Rep. Kathleen Willis (D-Northlake), a member of House leadership, whether Democrats were united in support of the governor’s pension plan…
No, I don’t think we’re all united. I think we all want to wait and see, look for possibly a better alternative to that because we don’t want to repeat history. We don’t want to see this. We’re open to ideas. But that doesn’t necessarily mean this idea.
posted by Rich Miller
Tuesday, Apr 16, 19 @ 12:14 pm
Sorry, comments are closed at this time.
Previous Post: The damage done
Next Post: It’s just a bill
WordPress Mobile Edition available at alexking.org.
powered by WordPress.
“But that doesn’t necessarily mean this idea.”
And your idea Rep. Willis to solve this IS?
Comment by Are Ya Kiddin' Me? Tuesday, Apr 16, 19 @ 12:21 pm
I hope Democrats speak up about not skipping the full pension payments annually. We don’t need that again. One thing Quinn did correctly was make sure the full pension payments were made. Pritzger should follow that philosophy.
Comment by Big Joe Tuesday, Apr 16, 19 @ 12:23 pm
The GA certainly has the power to find that $1.1 billion elsewhere.
Comment by wordslinger Tuesday, Apr 16, 19 @ 12:30 pm
“Skipping” funding into pension funds was and is a bad idea and is a financial catastrophe. I’ve never understood why the unions allowed it previously and I hope they’ve learned enough from experience to put a stop it this time.
Comment by Responsa Tuesday, Apr 16, 19 @ 12:33 pm
Since she is in leadership is she reflecting the views of the speaker? I hope so.
Comment by Regular democrat Tuesday, Apr 16, 19 @ 12:39 pm
Responsa, the unions never allowed pension skipping, and in fact, sued to stop it. They lost.
But I’m with you that it is a bad idea.
Comment by Jibba Tuesday, Apr 16, 19 @ 12:42 pm
Open to ideas? Glad to hear it.
Maybe start with legislating the state’s path to giving up this crown, “Illinois leads the nation in school district spending on administrators.” (see other thread regarding this ridiculousness)
Every dollar that is freed up from this kind of overspending is available to be spent somewhere else, like pensions.
It’s not that hard, folks. It just takes resolve, backbone, and the ability to say no to the virtue-of-the-day.
Comment by cdog Tuesday, Apr 16, 19 @ 12:45 pm
…the hollowing out of the governor’s legislative affairs team…
Comment by Hollow Man Tuesday, Apr 16, 19 @ 12:46 pm
===Every dollar that is freed up from this kind of overspending is available to be spent somewhere else, like pensions.===
1) The state’s share of this local spending is less than 20 percent.
2) 20 percent of half a billion dollars is $100 million.
3) The schools and teachers will loudly demand that the $100 million be plowed into the classrooms.
4) Simple solutions are usually neither.
Comment by Rich Miller Tuesday, Apr 16, 19 @ 12:48 pm
Cdog:
Fine idea, but how will that save money in FY 2020?
Here is an idea: cut the prompt payment interest rate to half a point.
Comment by Thomas Paine Tuesday, Apr 16, 19 @ 12:50 pm
If our state budget is $XX billion dollars, why don’t we raise $XX billion by raising taxes? Even with the new graduated tax, there is no indication IL will have a truly balanced budget moving forward.
Cut some fat, raise some money, balance the budget and get IL back on track. Seems pretty simple and I’d vote for whatever governor finally says that’s the right thing to do.
Comment by Hal Tuesday, Apr 16, 19 @ 12:52 pm
I still argue that stretching the ramp out longer isn’t “shorting” the pensions, but whatever. If we want to pay more into the pensions sooner, sounds good. Paying down debt faster is always a good goal. What are we NOT funding? We are not going to get a general income hike in the short term, unless I’m really off the mark, so that means cuts. Unless I’ve missed something, JB doesn’t have a lot of new programs. He’s increasing the funding for early childhood, and wants to put more into schools. There’s a bit of a bump to higher ed I think. Are we not going to do that? Or is there other significant funding increases I have missed?
I’m not (entirely) being snarky, I’m open to ideas, I just don’t know where to cut.
Comment by Perrid Tuesday, Apr 16, 19 @ 12:52 pm
===stretching the ramp out longer isn’t “shorting” the pensions===
It isn’t if you put lots more money in up-front. Otherwise, it is.
Comment by Rich Miller Tuesday, Apr 16, 19 @ 12:54 pm
===Seems pretty simple and I’d vote for whatever governor finally says that’s the right thing to do===
Well, Rauner campaigned on that. So did PQ. Simple solutions are usually neither.
Comment by Rich Miller Tuesday, Apr 16, 19 @ 12:55 pm
Thomas, or just tie the state prompt payment to the federal prompt payment interest rate, which is 3.5% now. Anything is better than 12%. I know during the impasse we supposedly spent $1bn on interest, which means we could have saved something like $700 million by having 3.5% interest instead of 12% (really, really back of the napkin math there), but I expect that will be much smaller now that the state is paying relatively quicker. Still a good thought though.
Comment by Perrid Tuesday, Apr 16, 19 @ 12:57 pm
=== I expect that will be much smaller now===
Yep.
Next!
Comment by Rich Miller Tuesday, Apr 16, 19 @ 12:58 pm
===Well, Rauner campaigned on that. So did PQ. Simple solutions are usually neither.===
Funny enough, I voted for both of them. Rauner clearly didn’t have the political chops to get it done, but I’d rather someone at least tell us what the issues are and how they propose to fix them. If they can’t we’ll vote for someone else. But can kicking and false promises got us in this mess.
Comment by Hal Tuesday, Apr 16, 19 @ 1:02 pm
If I may respond, I agree that simple solutions are not going to do the trick with Illinois’ fiscal situation, but…
This situation can be framed as a culture of spending problem. We’ve seen it several times in the past 90 days from this GA with more burdens added to the expense side of the ledger and little to no regard for the impact on the current budget deficit or future budgets.
Cut the $100 million out of school administration, set the tone that every dollar is going to be watched and respected. Nothing will change until these spending attitudes change.
No other state operates like this. It’s truly baffling.
Comment by cdog Tuesday, Apr 16, 19 @ 1:16 pm
Oh, it’s a matter of “culture,” “tone” and “attitudes.” Thanks for being so specific.
Does “culture” plus “tone” plus “attitudes” equal $3.1B?
Comment by wordslinger Tuesday, Apr 16, 19 @ 1:25 pm
Try reducing you mortgage payment and then explaining to the bank you aren’t shorting them, you just have other things you want to spend the money on.
Comment by Lucky Pierre Tuesday, Apr 16, 19 @ 1:51 pm
I wonder if Pritzker would have won the primary if he had announced this plan. This is a bait and switch…we now see what j.b. is really about.
Comment by wondering Tuesday, Apr 16, 19 @ 2:00 pm
The politicians in this state never fail to amaze and disappoint. Also never failing to amaze is the willingness of the voters in this state to keep electing people whose answer to a bill is “postpone paying”it. Better idea would be to take away some of the funding hikes in K-12 education while removing some mandates (especially the “teach about my pet issue mandates) and use that money. Also, please, for God’s sake, reform the pension system. Oh, sorry, God (Mike M.) won’t do that.
Comment by NeverPoliticallyCorrect Tuesday, Apr 16, 19 @ 2:46 pm
JB is in a box
Raising taxes now reduces his odds of getting his “Fair Tax “ passed.
Cutting costs in this budget risks horrible headlines. Departments have been hollowed out. New Directors do not know enough to reshape their departments. And cannot yet distinguish fat from muscle.
Stretching out pension funding is the best of bad options.
Should he look for savings? Of course, but he cannot get them immediately.
Comment by Last Bull Moose Tuesday, Apr 16, 19 @ 3:10 pm
Stretching out pension funding will require a lot more, and higher, payments later. This is, literally, mortgaging the future of Illinois … something we have been doing since about FY75.
Comment by RNUG Tuesday, Apr 16, 19 @ 3:15 pm
NPC
They did reform pension system
It’s called tier 2
Comment by Nick Tuesday, Apr 16, 19 @ 3:55 pm
Said it before, saying it again…..should have stuck with Quinn.
Comment by wondering Tuesday, Apr 16, 19 @ 4:01 pm
And tier1 “reform” was pasted and thrown out by the courts. Saying again, that for current employees benefits cannot be reduced.
Comment by illdoc Tuesday, Apr 16, 19 @ 4:03 pm
What will it ever take to realize that the state contribution has to be made, the pension contract honored (as per the courts, repeatedly) and the sooner it happens, the less we all will owe? This does not seem like a difficult concept……….
Comment by Anonymous Tuesday, Apr 16, 19 @ 4:11 pm
==JB is in a box==
Well, he wanted the job very much and spent a whole lot of his own money to convince the electorate that he had answers to our states’ financial woes. It’s awfully early in his governorship for him (and us) to realize he’s “in a box”
Comment by Responsa Tuesday, Apr 16, 19 @ 5:01 pm
Simple Solution? Look at the social services budget for Illinois. Compare it to Red States.
And the President is sending more non-citizens to Chicago.
Comment by Mary782 Tuesday, Apr 16, 19 @ 5:53 pm
J.B., the pensions aren’t a piggy bank. Shorting them. given their high interest rates, isnt the least of all bad options. I voted for you because I thought youd make the tough decisions necessary to right this state. Wheres the asset lease who’s proceeds infuse the pensions with some front-loaded funds…instead we get more of the good old shorting…you’re rapidly defining yourself as one of the same mopes that got us into this mix in the first place. Get a spine. Pay your Bill’s, and raise revenues enough to actually pay for them. Otherwise, you’re no better than blago.
Comment by PublicServant Tuesday, Apr 16, 19 @ 6:26 pm
==Solution? Look at the social services budget for Illinois. Compare it to Red States.==
Texas social service budget 79.5 billion(hhstexas.gov) biennium for 28.7 million people equals per year $1390 per person versus Illinois social service budget 5.9 billion (Chicago Tribune) for 12.8 million people is $461 per person. You were saying?
==And the President is sending more non-citizens to Chicago.==
Who don’t qualify for social services.
Comment by Da Big Bad Wolf Tuesday, Apr 16, 19 @ 7:29 pm
The Democrats just can’t help themselves. They absolutely must spend money they don’t have. Even the “progressive income tax” won’t be implemented for another two years (if at all), and instead of looking at responsible budgeting they’re twisting themselves into pretzels to find ways to do another pension holiday.
Ironically, if they had exercised fiscal restraint in the past and not done two pension holidays already, the pension system wouldn’t need so much money now.
Comment by Just Me 2 Tuesday, Apr 16, 19 @ 11:08 pm
Here we go again. What happens to the credit rating when pensions are shorted?
Comment by Old Illini Wednesday, Apr 17, 19 @ 9:22 am