Wednesday, May 09, 2007

GRT debate or lack thereof

We only have to wait until Thursday to find out whether Gov. Rod Blagojevich’s plan for a new gross receipts tax will have enough votes to pass the House. House Speaker Michael Madigan said he's introducing a resolution that would ask whether each House member is for or against the GRT. And he said he'd call the resolution for a vote Thursday.

That opened Wednesday’s special committee of the entire House to debate the GRT, which House Minority Leader Tom Cross predicts will die in the chamber. Expected co-sponsor the resolution, Cross said he predicts the resolution would prove GRT lacks the votes regardless of the tinkering approved by a Senate committee Tuesday. He added that the only thing that would improve the GRT proposal is if it were eliminated all together. “Get rid of it,” he said.

Because it’s only a resolution, it’s nonbinding, but it would send a clear message to the governor about how far his legislation needs to go before he gets his wish list. Blagojevich said Wednesday morning that he’s eager to compromise, but only within his GRT plan and not other tax proposals.

All of his plans, by the way — education reform, state-sponsored health care and a capital plan for road and school construction — completely depend on the GRT becoming law. Blagojevich says no other revenue ideas would generate enough money to prevent having to cut spending: i.e. essential government services.

He warned legislators that if they sent him an increase in the income tax and extension of the sales tax, as proposed in the alternative “tax swap” plan in HB 750, they wouldn’t have big utilities to blame for increased bills as they have in the electricity rate debate. But more importantly, he said, he philosophically opposes swapping property tax relief for higher income and sales taxes. “If you pass it, I won’t sign it. If you pass it, I will veto it,” he said in his 21-minute opening statement. “It’s an unfair burden on people. It’s regressive, and people already are paying too much.”

The scene during this morning’s portion of the anticipated eight-hour hearing was interesting. Blagojevich wasn’t at a podium as he usually is during State of the State addresses each year. He sat at a folding table in the front of the chamber, so he had to face the representatives from a slight decline on the floor as they asked him questions: 26 minutes of questions from Republicans and 26 minutes from Democrats.

Blagojevich answered some questions directly, but the proceedings were so rushed that lawmakers resorted to asking the questions but allowing the governor to respond later in writing. GOP members said they’d share the answers with the press, but that simply repeats the pre-packaged answers that have been filtered by a select few communicators. I’d rather the real-time debate.

We’ll gather more reaction from legislators soon, but one point by Rep. David Miller, the Chicago Democrat sponsoring HB 750’s tax swap, is interesting: What commitment does the administration make for the GRT revenue generated in the second and third and fourth year of the tax?

The POWER rage
by Deanese Williams-Harris

ComEd released its proposed rate relief package Tuesday; however, a day later, angry Ameren and ComEd customers packed the Statehouse for a rally of POWER, which means People Organized and Working for Electric Relief.

A crowd of seniors repeatedly yelled, “We need relief. We need relief,” as they banged on cardboard boxes. Some chanted through orange caution cones. Several held homemade signs. One senior in a wheelchair held a sign that said, “The IRS takes your shirt; Ameren takes your pants too,” on one side and “When are those fat cats ever satisfied?” on the other.

Some legislators managed to slip out of the Committee of the Whole to share a few words with the crowd. “They said we would have $1 to $2 increases on our bills,” said Rep. Dan Reitz, a Steeleville Republican. “Maybe it was a misprint because our bills have gone up 200 [percent] to 300 percent.”

Same story, different company
by Deanese Williams-Harris

ComEd says it will move forward with a $64 million rate relief program for its customers. Then again, if the legislature approves a one-year freeze on electricity rates, the utility would snatch the program off the table. That’s exactly what Ameren Illinois did earlier this session.

ComEd filed the rate relief plan with the Illinois Commerce Commission and says there will be a public hearing later this month. The $64 million plan would spread out over three years, with $44 million this year and $20 million each in 2008 and 2009. It offers a $10 monthly credit to relieve summer bills. It also would put money into other programs to help low-income residents.

If a rate freeze is signed into law anyway, ComEd showed no qualms about taking action. “We will go to federal court,” said Bob McDonald, chief financial officer. “We think we have a very solid case.” If that doesn’t work, he said the next step for the company would be to file bankruptcy.

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