Saturday, May 31, 2008

Will ethics bill be “improved to death?"

By Patrick O'Brien
After a three-year battle, the imprisonment of one governor and federal investigations of another, state lawmakers took a step today toward taming
Illinois' “wild west” reputation for political corruption.

But despite the General Assembly’s unanimous votes on the “pay-to-play” reforms, Gov. Rod Blagojevich may make changes to the proposal and send it into limbo again. “There’s a lot more that needs to be done,” said Rebecca Rausch, a spokesperson for the governor, shortly after the House vote.

One day after a tornado in the state capital, the measure’s sponsor saw reasons to be optimistic about the measure becoming law.

“The sun is shining, the birds are singing, and we finally passed a new ethics bill in Springfield,” said Rep. John Fritchey, a Chicago Democrat.

The plan would ban contractors with more than $50,000 in state business from donating money to statewide officeholders’ political campaigns.

The measure would not ban contributions to state political parties, a point of contention for Senate President Emil Jones Jr., a Blagojevich ally who said during committee that the bill could be “improved.”

“This addresses a very specific problem, the pay-to-play problem with contractors in state government,” said Cindi Canary, executive director of the Illinois Campaign for Political Reform. She added: “If you look at the Ryan Administration, and if you look at, particularly, Ryan when he was secretary of state, we saw a lot of this. This is not a new problem. Sadly this has been taken to somewhat of an art form in recent years, but this is something that has gone on for some time.”

Fritchey said the bulk of the reforms have already been enacted by all statewide executives on their own, with “one glaring exception,” the governor.

Rep. Jack Franks, a McHenry Democrat and frequent Blagojevich critic, said the governor hasn’t taken the active role in ethics reform that he promised in a 2003 speech. “I’m still waiting for that bill from the governor that would ‘rock the system’ and reform what we’re doing in Springfield.”

Fritchey said the measure’s Senate sponsor, Don Harmon, an Oak Park Democrat, and Sen. Debbie Halvorson, a Crete Democrat, will call for a veto override in that chamber if the governor tries to change the bill. Fritchey expressed concern that the governor would try to “improve the bill to death” to defeat it.

Friday, May 30, 2008

The imperfect storm

By Bethany Jaeger
A tornado warning interrupted the House and Senate this evening before they could debate larger portions of the state operating budget, further delaying the ability to approve a spending plan before the constitutional deadline of midnight Saturday.

We all had to head to the basement of the Statehouse, where tunnels connect buildings on the Capitol complex. Amanda Vinicky, reporter for WUIS public radio station out of the University of Illinois at Springfield, caught up with House Speaker Michael Madigan in one of the tunnels. We listened to her audio file. She asked the speaker about the status of the budget, the leadership style of the governor and the lack of trust plaguing the democratic process.

Madigan’s advice for others was to consider the past five or six years — and to “prepare for the worst.”

The General Assembly is expected to approve a state budget before the deadline, but the budget also is expected to contain a rather large hole. Madigan said the legislature’s job is to approve the spending authority. The actual spending is up to the governor. “If he feels that some of those numbers should be changed, he has a reduction veto.”

The state Constitution grants the governor the power to strike out portions of the budget or to reduce the amount of money dedicated to specific programs.

The lawmakers also are considering the capital plan drafted by former U.S. House Speaker Dennis Hastert and Southern Illinois University President Glenn Poshard, who were recruited by Gov. Rod Blagojevich to bring everyone together on a multi-year plan for construction projects. Madigan has not attended any of the meetings with the negotiators and the other legislative leaders. Of the governor’s previous meetings, Madigan said, “I have found meeting with Gov. Blagojevich to be totally non-productive, and so we decided to take a different approach.” That included sending his majority leader, Rep. Barbara Flynn Currie, in his place.

The $31 billion capital plan has grown to $33 billion under the Senate proposal (see below). It now has a specific list of projects that would be funded, something legislators demanded before they could consider approving a deal. But rank-and-file legislators, particularly Democrats, continue to question whether they could trust Blagojevich to release the money for projects in their districts. Madigan reiterated the reason behind lawmakers’ hesitation: “It’s all about trust. It’s all about trust and whether people are prepared to trust Gov. Blagojevich and trust his record of broken promises.”

The legislative leaders are meeting with the governor in his Statehouse office as I post this. The Senate is expected to meet in committees yet this evening to discuss the capital plan and the proposed funding sources, including leasing the Illinois Lottery; expanding gaming to include a new and two additional riverboats, as well as expanding positions at existing facilities; and transferring money from the state’s Road Fund and the general fund. The House is done for the evening but will start with committees at 8:30 a.m. Saturday. Expect a long day and night.

Here are a few other items of interest that unfolded earlier Friday:

Potential CeaseFire agreement
Rep. Susana Mendoza, a Chicago Democrat, said she’s able to vote for a state budget now that an agreement has been made with Senate Democrats to reinsert $6.25 million into the state budget for a CeaseFire, gun violence prevention program.

The CeaseFire campaign employs ex-convicts to work as mediators to diffuse tension in communities with “hot spots” of gun and gang violence. They also connect clients to community services for jobs, education and other social services. The program is administered by the Chicago Project for Violence Prevention located at the University of Illinois at Chicago’s School of Public Health.

Gov. Rod Blagojevich last summer vetoed $6 million for CeaseFire from state budget as part of a series of budget cuts totaling about $460 million.

In early May, a Northwestern University study announced the program as successful in deterring gun violence. Professor Wesley Skogan at the Evanston school found that the number of shootings dropped between 16 percent and 34 percent in four Chicago neighborhoods with CeaseFire programs. Six CeaseFire communities saw a 42 percent average reduction in shootings during the first year of the program.

The study also shows that the program has lasting effects on such other challenges as getting jobs, returning to school or disengaging from gangs. Clients interviewed for the survey also reported that they built relationships with their mediators so that if, for instance, they felt tempted to use drugs again, they could call their mediator in the middle of the night.

The study concluded that the program saves the state and the taxpayers money by decreasing the number of emergency room visits and the number of criminals in the justice system.

Potential Medicaid reimbursements for hospitals
The state could garner up to $4.5 billion in federal funds over five years that Illinois would redistribute to hospitals, primarily facilities that care for the most needy patients. The legislature is advancing a plan that would need the governor’s signature and the feds’ approval.

About 200 hospitals in the state already have participated in a so-called hospital assessment program, collecting a total of $$2.3 billion over three years. That program is set to expire June 30. The plan approved by the House Friday afternoon (and expected to win Senate approval Saturday) would create a new program for the next five years.

The new plan would be larger than the existing program. It would distribute more than $640 million a year to the hospitals that voluntarily pay an assessment (a.k.a. tax) that leverages federal matching funds. This plan also differs in that more hospitals, particularly in the Chicago suburbs, would be considered “losers,” meaning they would pay out more than they collected in federal reimbursements. The feds view that favorably because the system would better redistribute the money to the most critical and needy hospitals in rural and low-income areas, says House Majority Leader Barbara Flynn Currie, a Chicago Democrat.

She added the state also needs the plan because without federal approval, “we will be looking for substantial dollars to fill a very deep hole in the state’s Medicaid budget.”

Sen. Jeff Schoenberg, an Evanston Democrat sponsoring the measure in his chamber, said hospitals agreed to the plan. “Everybody recognized that we all have a stake in it together, and without this infusion of new federal Medicaid funding, many hospitals in the state will have to either curtail their services or close their doors entirely. And we simply cannot allow that to happen.”

That’s partially because without the program, hospitals on average would be paid only 64 percent of what it actually costs to deliver the care, said Howard Peters with the Illinois Hospital Association.

The state also leverages about $130 million that’s left over from the Medicaid reimbursement program to obtain additional federal matching funds. They must be spent on health care, including services for mental health, developmental disabilities and long-term care. Schoenberg said that he would like to use some of the excess money for substance abuse and treatment programs, many of which have long waiting lists. That would require legislative approval.

Just for fun
To the right: Rep. Mike Fortner, a West Chicago Republican, explains the physics of a tornadic cell to fellow legislators and lobbyists after a tornado was sighted in Springfield.

Thursday, May 29, 2008

It's close

By Patrick O’Brien and Bethany Jaeger
The House and Senate may have drawn closer to agreeing on a state budget today, but it’ll come down to Friday and Saturday to find out whether the legislature is headed into overtime session.

Negotiators likely have found a common ground on school funding, which would increase by between $500 million and $530 million, according to Rep. Gary Hannig, the House budget negotiator. Higher education funding levels also are relatively close, granting nearly a 3 percent increase across the board. Budget negotiators need to work out funding levels for community colleges.

The main sticking point in the overall budget appears to be with the House Democrats, who want to increase spending for human services. But Hannig said the House tomorrow likely will present two more substantial portions of a budget that would represent an agreement between the chambers.

The House sent two smaller, less-controversial portions of the budget (here and here) to the governor this afternoon. They would fund such agencies as the Capital Development Board, the Illinois Commerce Commission and the Illinois Workers’ Compensation Commission at mostly current levels.

“It’s more likely that we would take up the rest of the budget perhaps tomorrow,” Hannig said. That leaves tens of billions in spending still under negotiation.

Whether the final budget will be balanced is up to debate.

Rep. Renee Kosel, a New Lenox Republican, said this year’s budget process has made it impossible to know whether the Democrats’ plan carries a deficit. “I can’t tell you whether it’s a flat budget or whether it’s a balanced budget because we don’t have all the pieces,” she said. She added that increased education funding is necessary because of increases in enrollment.

Over in the Senate, Democrats showed a rare sense of solidarity as they approved two ways to plug a projected $500 million hole in the budget.

They had to scurry around the floor to ensure all their ducks were in a row to approve a $16 billion borrowing plan. They did. The plan would pump money into the increasingly expensive pension systems for public employees. They later approved a mechanism that would allow the governor to sweep about $500 million out of special dedicated funds, which would help put more money toward education and leverage up to $530 million in new federal matching funds.

All Republicans voted against the plans. That’s a sign that the pension deal faces a severe challenge in the House, where some Republicans would have to support it for the plan to pass. Quote Hannig: “It’s hard for me to see how you can find 71 votes out here. I have advised the Senate of the difficulty that they will face in the House.”

Senate Democrats defended the pension bonding proposal as a way to refinance $42 billion of debt at a lower interest rate, saving the state about $55 billion in the long run. It also would free up $500 million that otherwise would have been earmarked for the state’s contribution to the five pension systems next fiscal year.

Republicans dismissed the bonding scheme as risky for two reasons. Current market conditions can’t guarantee generous returns on investments, and the governor and the legislature can’t be trusted as they continue to fudge with the payment schedule set in the 1990s.

“This is more about budget relief than it is about fixing the pensions,” said Sen. Christine Radogno, a Lemont Republican.

Senate Minority Leader Frank Watson likened the plan to an “Enron borrowing scheme.”

The so-called fund sweeps legislation would not only leverage federal funds and free up existing state dollars, but it also would be restricted by federal rules on how they could be spent, said Sen. Jeff Schoenberg, an Evanston Democrat sponsoring the measure. He said the federal rules address the concern that the legislature relinquishes too much power to the executive branch.

Nearly 30 funds also would be prohibited from being swept. They include funds for veterans’ homes, teachers’ health insurance and public transportation needs, as well as a motor cycle riders’ safety training fund that landed in court last year.

The House would need a regular majority to approve fund sweeps, meaning Republican votes would not be needed if all Democrats were on board.

Wednesday, May 28, 2008

A lot has to happen in three days

The governor’s office called it significant, and it is significant when major state government officials stand together in favor of the first major construction plan in nine years. But it’s also significant that House Speaker Michael Madigan wasn’t there. And although everyone present said they agreed on the general proposals for financing a capital plan, they’re still negotiating fine details that would have significant effects on construction projects for roads, bridges and schools.

As usual this time in the legislative session (three days left to act on a state operating budget before the Constitutional deadline and before Republicans get a seat at the table), lots of things are in the air. For instance, the House stripped most of the Senate’s version of a state budget and will import its own revised plan. The Senate, meanwhile, stripped numerous House-approved measures because they would have required all rules for new laws to be approved by the General Assembly. The rules currently are reviewed and approved by a much smaller panel. By the Senate rejecting the rulemaking provision, those measures have to go back to the House.

Separate from the operating budget is the capital budget. Gov. Rod Blagojevich made it clear this afternoon he is not tying the two together. That’s good news for those waiting for an agreed operating budget because the proposed capital plan involves controversial revenue sources that could take awhile to win the support of enough legislators. It would require the state to lease the Illinois Lottery for an immediate influx of cash, expand gaming to include new casinos and slots at racetracks and divert money from the Road Fund and the state’s general fund. See more here.

House Minority Leader Tom Cross said the legislators who might hesitate to support those revenue ideas might be willing to consider given the dire need. “Let’s be clear. Not every member of our caucus is going to support this. And that’s the case in all four caucuses, but we have gone nine years without capital. So you’re seeing a willingness and an openness for members to look at ideas that maybe they wouldn’t have embraced eight years ago.”

The Senate GOP Caucus added that it’s concerned about the integrity of the plan for distributing the money, according to Senate Minority Leader Frank Watson. He said he wants a “lockbox” provision to ensure money would go to the projects promised. And he wants remaining money, which he said was roughly $650 million, to go into a fund that would help offset the loss of revenue going to education — because if the state leased a portion of the lottery, which is supposed to help fund the state’s public education system, then the state would lose that constant stream of money). That’s still in negotiations, Watson said. “The bill is not final, but we hope that when we get it, we’ll have a comfort level that will enable us to support this. And I feel that it will.”

The governor says he’s not looking beyond May 31 and said it’s hopeful to get a capital plan and an operating budget done by then. Jones touched on an “Obama factor,” which means Illinois Democrats plan to campaign for U.S. Sen. Barack Obama’s presidential bid before the Democratic National Convention in Colorado in late August. “We are currently working on the budget,” Jones said. “We are currently working on this capital plan. And we intend to be out of here because the next president of the United States will be looking for us in Denver.”

A Madigan spokesman wasn’t immediately available late this afternoon. I’ll add his comments as soon as I can.

Tuesday, May 27, 2008

A lot can happen in five days

By Bethany Jaeger and Patrick O'Brien
A major piece of the Senate's version of a state budget is unlikely to advance, but that might not hold up the entire budget. The General Assembly has until midnight May 31 to approve a budget without needing Republican votes.

The Senate's plan to float a $16 billion pension bond scheme would refinance the state's five pension systems — which have accumulated more than $42 billion in debt — and pay them off at a lower interest rate. (See more details in our previous blog post.)

If approved, the deal would free up $500 million for legislators to spend in the next fiscal year that start July 1. If denied, the deal would leave a projected $500 million hole.

Sen. Donne Trotter, a Chicago Democrat, said informal discussions with House Democrats about the pension deal indicate it may be difficult to get Republican votes necessary to get a three-fifths majority in each chamber.

The sponsor, Sen. Don Harmon, an Oak Park Democrat, said he has just begun the process of counting whether he has the votes in the Senate. The measure is still being changed and would need to go back to committee before even being called to the floor, leaving little time for the House to act on the same legislation before May 31.

Sen. Christine Radogno, a Lemont Republican, said one of the changes would give more authority to Gov. Rod Blagojevich's Office of Management and Budget, which would prove controversial after recent allegations of scandals involving state contracts within his administration.

Even so, Harmon said lawmakers could approve a state budget by the end of the week even without a pension deal. “We need to get a budget done before the end of May, whether it includes pension obligation bonds or not. We need to get a budget done.”

Rep. Mark Beaubien, a Barrington Hills Republican, said the pension idea has a fat chance in the House. But he said the idea of advancing a bare bones budget without a plan to plug the projected $500 million hole also wouldn't fly. In other words, he said, they may need to start from scratch.

Rep. Bob Molaro, a Chicago Democrat, had a different take. He said a bare bones budget is the way to go. That would allow the General Assembly to come back in the fall to reconsider the size of any budget deficit. “That's an open question, how bad the budget hole is,” he said, later adding, “If it's still out there in November, we come back and figure out the revenue stream.”

Reconsidering a pension deal or any new revenue plan after November would ease some pre-election jitters about voting for something controversial. That would crack the door open a little further for such ideas as floating pension bonds or increasing state taxes. As Radogno said, if the pension deal failed, legislators could pull the sale of the dormant 10th casino license “out of a hat” in an attempt to balance the budget. That deal could be worth about $500 million.

Friday, May 23, 2008

Welcome to the house of cards

By Patrick O’Brien and Bethany Jaeger
There are 1.7 billion reasons the House and Senate have their work cut out for them as they try to negotiate a state budget by the end of the month.

That’s the difference between the chambers’ closest budget proposals, according to Sen. Donne Trotter, a Chicago Democrat and the Senate’s lead budget negotiator.

Trotter also said the “Christmas tree” budget advanced by the House earlier this week would not be considered by the Senate. “It’s a non-starter,” he said. “We’re not going to that level whatsoever.”

The Senate’s budget plan, which advanced along party lines today, increases spending in some state agencies and modestly increases funding for education. But it depends entirely on the approval of a $16 billion pension bond deal that would go toward pension liabilities. But it also would free up about $500 million that otherwise would have gone into the state’s annual contribution to the five public employee pension systems. See more about how that would work in last night’s blog post.

Sen. John Sullivan, a Rushville Democrat, said the pension deal is far from done. “It’s absolutely going to be troublesome, especially in the House,” he said. “It’s going to be troublesome here as well.” If the deal fails, Sullivan added, the state could have to cut $500 million from state agencies.

Senate Minority Leader Frank Waston said the pension bonds don’t even live up to the obligations Democrats set for themselves in a 2003 deal. “Every year, we go through this,” he said during floor debate. “At some point in time, somebody’s going to have to pay. And unfortunately, reality has not set in, especially on your side of the aisle.”

The GOP voted against the plan because they said it was out of balance, partially because they think Democrats are misjudging the amount of revenue the state’s flagging economy can produce.

Sen. Christine Radogno, a Lemont Republican and budget negotiator, questioned Democrats’ priorities. For instance, they would decrease funding for teachers who work with students in the Illinois Department of Juvenile Justice. “I don’t think the priorities are right at all,” she said. And if the pension deal fails, then the entire budget is out of whack.

Funding for the expansion of the LaSalle Veterans Home also was not part of the Senate’s plan. Sen. Gary Dahl, a Peru Republican, said it was an act of political retribution. “When you pick on my veterans, we’ve got a problem,” he said. “You’ve gone out of bounds on this one.”

The Democratic proposal would increase funding for veterans’ homes, including the one in LaSalle. But Dahl said that wouldn’t be enough to hire the number of nurses necessary to fill beds that are already available but unused. See the next print edition of Illinois Issues magazine, available in the first week of June, for more information about the funding crunch at all of the state’s veterans’ homes.

Trotter simply said the budget proposal lives within the state’s means. “This is the time to be responsible,” he said. “This is all we can afford.”

Here’s a few examples of the Senate’s version of a budget, which all agreed was a starting point:
  • The Senate would spend $29 billion out of the state’s general revenue fund.
  • The Senate budget relies on $1.73 billion in new revenues:
  • $1.2 billion of that would come from such items as state tax revenues and the federal stimulus package.
  • $530 million would come from fund sweeps of dedicated accounts. That would be split up: The Senate Democrats would use $260 million of that to collect federal matching funds to pay Medicaid bills, and then they’d spend $170 million on about two dozen school construction projects that were promised state funds about five years ago. It wasn’t specified how the remaining $100 million would be dispersed.
  • It also relies on the $16 billion pension deal to free up $500 million that otherwise would have gone toward the state’s annual contribution.
  • The Medicaid bills, however, continue to mount, although the Senate Dems’ budget proposal would not include new Medicaid programs. The payment cycle also would remain around 70 days on average, which is not an improvement.
  • The Senate would increase education funding so that the minimum state aid per student reaches about $6,000. It also would increase money available for early childhood education programs and bilingual education.
  • Neither chamber proposes closing any prisons.

We've been here before

The Illinois Senate has passed an ethics reform package aimed at preventing pay-to-play politics that stain Illinois government. Even if the House approved the same exact language to prohibit state contractors and their families from donating to officeholders who grant the contracts, all eyes are on Gov. Rod Blagojevich to see not if, but how he’ll change the legislation to “improve” it.

“It’s a beginning, but it does not go nearly far enough,” wrote Rebecca Rausch, Blagojevich’s spokeswoman, in an e-mail after the Senate unanimously approved Sen. Don Harmon’s measure today. “We urge the House to take this opportunity to make the bill broader and more comprehensive.”

Harmon, an Oak Park Democrat, said during floor debate that he intentionally kept the scope of the measure narrow to avoid curtailing speech, or preventing people from donating to political campaigns to show support. He also did not include a provision that would have prevented contractors from donating to statewide political campaigns, which also fund constitutional officers. That provision was desired by Senate President Emil Jones Jr., who called it a "loophole."

Democrats and Republicans lauded the effort and said this is a good first step, but it’s only a first step, as Sen. Christine Radogno said. She’s a Lemont Republican and persistent voice on ethics reform.

Sen. Jeff Schoenberg, an Evanston Democrat, said, “We have moved a major boulder off the road to achieve the level of progress that we hope to achieve.”

But he said before getting too self-congratulatory, legislators need to keep in mind there’s more to do: better define the roll of independent advisors in the executive branch and provide greater accountability and transparency for how pension investment decisions are made. Both target problems under the microscope at the federal corruption trial of Tony Rezko, an unofficial advisor to the governor who is charged with rigging state boards to steer state contracts to political campaign donors. The jury is currently deliberating whether federal prosecutors proved its case against Rezko.

Senate Minority Leader Frank Watson said he hopes Harmon’s measure does win House approval — Harmon said he felt confident the other chamber would concur with his changes — but Watson cast doubt over whether the reform would become reality. He spoke directly about Blagojevich. “I think [the governor] ultimately has to sign it," he said. "We don’t need any help, we don’t need an amendatory veto, we don’t need him to make it better.”

An amendatory veto would send the measure back to the General Assembly, where the two chambers continue to function as two gears — sometimes turning in sync but most often stopping the other from moving. Harmon said he’s also confident the measure would gain enough votes to override the governor’s changes.

We’ll update you when we hear back from the House sponsor, Democratic Rep. John Fritchey of Chicago.

Thursday, May 22, 2008

The puzzle gets another piece

The Senate unleashed its $16 billion pension deal tonight in a tense but brief hearing. The House did not include a pension package in its series of budgets approved yesterday, indicating a rough road ahead for the plan that the governor has tried for two consecutive years.

The governor achieved a $10 billion pension deal in 2003, and higher than expected savings resulted. This time, market forces change the equation a bit.

Sen. Don Harmon, an Oak Park Democrat, said the deal would take care of the next payment and reset a payment cycle set in 1995 for state contributions. The goal is to knock down Illinois’ $42 billion pension liability 11 years earlier than scheduled.

It’s “similar but not identical” to the plan floated in 2003. Gov. Rod Blagojevich secured a lower interest rate and generated money that could pay down the ballooning liabilities. But the plan had a twist. While it still ramped up payments in future years, the General Assembly allowed the governor to pay the required amount that year and then skip $2.3 billion in state contributions in fiscal years ’06 and ’07.

Harmon said this deal would only go into the state's five pension systems and would not include a “pension holiday.” Instead, he said it would ease the budget deficit. “It’s less money we don’t have.” He also said it would result in a $55 billion savings over the life of the bond issuance and allow a more manageable and regular payment schedule through 2038.

Senate Republicans on the committee, including Sen. Bill Brady of Bloomington, said the state still has the same unfunded obligation, $42 billion, and adds to its bond debt that it still has to repay. Counter to Harmon, Brady said the proposal would undercut the state’s payment by $500 million. If the state did nothing, the schedule calls for a $3.3 billion payment next fiscal year. Under the proposal, Illinois would contribute $2.8 billion, Harmon said.

Tension mounted as vice chair of the committee, Sen. Michael Noland, an Elgin Democrat, kept trying to cut off debate to avoid dramatics. It didn’t work, and Harmon invited more questions. In the end, Republicans walked out of the room to protest the 15-minute debate on a $16 billion proposal.

The Taxpayers’ Federation of Illinois opposes the new proposal because it lacks pension reforms that the group has called for for numerous years. The measure also pushes back the ramped up payments until later and sparks concern when playing with a significant amount of state dollars in the stock market, said David Eldridge, the group’s legislative director. In other words, there’s no guaranteed savings that the state achieved in the 2003 deal.

Some common ground
By Patrick O’Brien
Earlier Thursday, a Senate committee moved the budget proposals for 69 state agencies, including the Department of Natural Resources and each statewide executive office. According to Sen. Donne Trotter, a Chicago Democrat and point person on the budget, most agencies would receive little or no increase over last year’s funding.

One notable exception is higher education. The House and Senate proposals are almost identical. State universities would receive a 2.8 percent increase, which follows years of stagnant funding or decreases.

The Senate’s higher education budget was a “very optimistic sign,” said Rep. David Miller, a Chicago Democrat. “There’s going to be some changes at the end, but we’re not simply starting from scratch.”

IDOT: It’s that bad
By Bethany Jaeger
The Illinois Department of Transportation will spend a majority of $10.9 billion on fixing existing bridges and repairing old roads during the next six years. It’ll spend a fraction, $633 million, on building new roads. Milton Sees, transportation secretary, said in a Statehouse news conference Thursday that lower-than-expected motor fuel tax revenues and increased costs of materials means state dollars buy less than they did a few years ago.

He said, it is that bad. “We continue to struggle with deteriorating roads, urban congestion problems and [miss] rural economic growth opportunities as a result of the situation we find ourselves in.”

The department has felt the effects of higher gasoline prices as drivers find ways to reduce their consumption, whether it’s by buying hybrid vehicles or just not driving as much, Sees said. And because the motor fuel tax is a flat amount per gallon, it doesn’t increase with the price of gasoline. “So as consumption goes down, our revenues decline along with that.”

According to Dick Smith, IDOT’s director of the office of planning and programming, the motor fuel tax usually generates about $1.2 billion a year. So a 1 percent decrease expected for the current fiscal year translates to about $12 million. The department expects only about 1 percent growth in revenues during the next six years, as well.

The $30 billion infrastructure program announced by the governor’s capital coalition Tuesday, would help, and Sees called it “doable.” (The six-year plan released Thursday does not depend on the approval of a pending capital plan.)

Sees said there is a specific list of projects that would be funded under a capital plan, but it’s a “working document that’s not ready for release.” He did say the projects would include adding lanes to relieve traffic congestion and building new interchanges along the state highway system. It also would provide some much-needed money for resurfacing projects that otherwise wouldn’t get attention in the six-year plan.

‘Pay to play’ may be voted on Friday
By Patrick O'Brien
The ethics measure that seeks to divorce state contracts from political contributions to officeholders may see a vote on the Senate floor Friday, according to Harmon, who also is sponsoring the reform package. He said Thursday night that he believes the plan would pass the House if it makes it out of the Senate first. A last-second change to include nonprofit groups cleared a Senate committee today, and Harmon said the bill won’t be further altered.

The puzzle gets another piece

The Senate unleashed its $16 billion pension deal tonight in a tense but brief hearing. The House did not include a pension package in its series of budgets approved yesterday, indicating a rough road ahead for the plan that the governor has tried for two consecutive years.

The governor achieved a $10 billion pension deal in 2003, and higher than expected savings resulted. This time, market forces change the equation a bit.

Sen. Don Harmon, an Oak Park Democrat, said the deal would take care of the next payment and reset a payment cycle set in 1995 for state contributions. The goal is to knock down Illinois’ $42 pension liability 11 years earlier than scheduled.

It’s “similar but not identical” to the plan floated in 2003. Gov. Rod Blagojevich secured a lower interest rate and generated money that could pay down the ballooning liabilities. But the plan had a twist. While it still ramped up payments in future years, the General Assembly allowed the governor pay the required amount that year and then skip $2.3 billion in state contributions in fiscal years ’06 and ’07.

Harmon said this deal would only go into the state's five pension systems and would not include a “pension holiday.” Instead, he said it would ease the budget deficit. “It’s less money we don’t have.” He also said it would result in a $55 savings over the life of the bond issuance and allow a more manageable and regular payment schedule through 2038.

Senate Republicans on the committee, including Sen. Bill Brady of Bloomington, said the state still has the same unfunded obligation, $42 billion, and adds to its bond debt that it still has to repay. Counter to Harmon, Brady said the proposal would undercut the state’s payment by $500 million. If the state did nothing, the schedule calls for a $3.3 billion payment next fiscal year. Under the proposal, Illinois would contribute $2.8 billion, Harmon said.

Tension mounted as vice chair of the committee, Sen. Michael Noland, an Elgin Democrat, kept trying to cut off debate to avoid dramatics. It didn’t work, and Harmon invited more questions. In the end, Republicans walked out of the room to protest the 15-minute debate on a $16 billion proposal.

The Taxpayers’ Federation of Illinois opposes the new proposal because it lacks pension reforms that the group has called for for numerous years. The measure also pushes back the ramped up payments until later and sparks concern when playing with a significant amount of state dollars in the stock market, said David Eldridge, the group’s legislative director. In other words, there’s no guaranteed savings that the state achieved in the 2003 deal.

Some common ground
By Patrick O’Brien
Earlier Thursday, a Senate committee moved the budget proposals for 69 state agencies, including the Department of Natural Resources and each statewide executive office. According to Sen. Donne Trotter, a Chicago Democrat and point person on the budget, most agencies would receive little or no increase over last year’s funding.

One notable exception is higher education. The House and Senate proposals are almost identical. State universities would receive a 2.8 percent increase, which follows years of stagnant funding or decreases.

The Senate’s higher education budget was a “very optimistic sign,” said Rep. David Miller, a Chicago Democrat. “There’s going to be some changes at the end, but we’re not simply starting from scratch.”

IDOT: It’s that bad
By Bethany Jaeger
The Illinois Department of Transportation will spend a majority of $10.9 billion on fixing existing bridges and repairing old roads during the next six years. It’ll spend a fraction, $633 million, on building new roads. Milton Sees, transportation secretary, said in a Statehouse news conference Thursday that lower-than-expected motor fuel tax revenues and increased costs of materials means state dollars buy less than they did a few years ago.

He said, it is that bad. “We continue to struggle with deteriorating roads, urban congestion problems and [miss] rural economic growth opportunities as a result of the situation we find ourselves in.”

The department has felt the effects of higher gasoline prices as drivers find ways to reduce their consumption, whether it’s by buying hybrid vehicles or just not driving as much, Sees said. And because the motor fuel tax is a flat amount per gallon, it doesn’t increase with the price of gasoline. “So as consumption goes down, our revenues decline along with that.”

According to Dick Smith, IDOT’s director of the office of planning and programming, the motor fuel tax usually generates about $1.2 billion a year. So a 1 percent decrease expected for the current fiscal year translates to about $12 million. The department expects only about 1 percent growth in revenues during the next six years, as well.

The $30 billion infrastructure program announced by the governor’s capital coalition Tuesday, would help, and Sees called it “doable.” (The six-year plan released Thursday does not depend on the approval of a pending capital plan.)

Sees said there is a specific list of projects that would be funded under a capital plan, but it’s a “working document that’s not ready for release.” He did say the projects would include adding lanes to relieve traffic congestion and building new interchanges along the state highway system. It also would provide some much-needed money for resurfacing projects that otherwise wouldn’t get attention in the six-year plan.

‘Pay to play’ may be voted on Friday
By Patrick O'Brien
The ethics measure that seeks to divorce state contracts from political contributions to officeholders may see a vote on the Senate floor Friday, according to Harmon, who also is sponsoring the reform package. He said Thursday night that he believes the plan would pass the House if it makes it out of the Senate first. A last-second change to include nonprofit groups cleared a Senate committee today, and Harmon said the bill won’t be further altered.

Wednesday, May 21, 2008

Worlds apart

By Patrick O'Brien
The two chambers of the General Assembly are negotiating budgets in two different universes.

The House advanced budget bills containing — by the Republicans’ count — an estimated $3 billion in additional spending.

House Speaker Michael Madigan said the budget process, which many Republicans said excluded them from the start, was open and transparent and reverted back to the process used before 1991. Madigan pointed out that two versions of the budget were presented, one that offered flat funding and one that increased funding for most agencies.

“You had your opportunity. You had your choice. What’s the complaint? There’s never been, since 1991, so much participation in budget making as there has been over the last several weeks,” he said.

The “opening up” of the process, however, could also generate election year ammunition to hurt vulnerable Republicans. By forcing them to reject the menu of budget options crafted exclusively by Democrats, their opponents could argue they failed to vote for any budget.

Republicans could still play a role in the budget process if Democrats of both chambers fail to send an agreed budget to the governor by May 31. GOP votes would be needed to get the three-fifths majority required after the constitutional deadline.

Rep. Jack Franks, a Woodstock Democrat who voted for some but not all budget measures Wednesday, said the battle has only just begun. “I think this is just the first salvo in what could be many budget bills going back and forth,” he said. “I don’t think anyone here believes that the stuff we voted on here today is going to be the final budget.”

Meanwhile, Senate Democrats …

Are basing their budget proposals on revenue estimates similar to those in the House, but they’re drafting a budget that would decrease funding in some state agencies and offer flat funding in others.

The Senate Democrats also are counting on almost $2 billion in additional “budget pressures” on top of state agency needs. These include new contracts for state workers, Medicaid funding to prevent doctors from waiting for state reimbursements and an $800 million increase in payments to the pension fund.

The Senate Democrats are working on a $16 billion pension bond deal for the state to address mounting liabilities, but they have not consulted with other legislative caucuses, according to Sen. Susan Garrett, a Lake Forest Democrat.

“It seems like we’re coming from this budget from entirely different perspectives. We’re not starting out on the same page,” she said. “I think what we have failed to do is establish priorities. I think that would make the budget come together.”

Tuesday, May 20, 2008

Trust plagues Goldie Locks and the three bears

By Bethany Jaeger and Patrick O'Brien
Former U.S. House Speaker Dennis Hastert started and ended a Statehouse news conference Tuesday by underlining the General Assembly and the governor’s troubled task of enacting a capital plan:

“We have about $9.5 billion in federal trust funds for covering a lot of things —highways, water projects, airports, transit — that if we don’t pass a piece of legislation that meets this time period so we can get shovels moving, trucks moving on the highway and take advantage of this construction season, those dollars will start to diminish because the trust fund’s diminishing.”

The other problem is a lack of trust between Gov. Rod Blagojevich and the state legislators. They can’t a) agree on a way to generate revenue to pay for a capital plan and b) spell out how that money will be spent.

Hastert was appointed by the governor along with Southern Illinois University President Glenn Poshard to serve as a buffer and move along negotiations for a statewide infrastructure plan. Hastert described the meetings with the legislative leaders as Goldie Locks and the three bears. The “porridge was never exactly right for everybody.” They drafted a proposal that he said should be acceptable to all. He ended the news conference this way:

“Is this perfect? No. But it’s the best that we could cobble together … and I think it has a very good chance of moving if everybody comes to the table and works together in a process. Will that happen? I can’t predict that. Thank you very much. End of session.”

He and Poshard announced a $31 billion capital plan, up from the governor’s original $25 billion proposal, for everything from water and sewer projects to long-term road projects that have been on hold for years. It also would fund projects for higher education facilities, as well as early childhood education space needs, and many other state and local initiatives for economic development and transportation.

At stake is $9.3 billion in federal earmarks for state projects, which Poshard and Hastert said are dwindling and vulnerable if Illinois doesn’t put forth the matching funds soon. “If we can’t get the job done with what we’ve done in the last highway bill … we don’t have a ghost of a chance getting those numbers again.” Illinois Department of Transportation Secretary Milton Sees said he expects to lose between $3 billion and $4 billion when the feds draft their next highway bill without a timely state match.

The proposed plan would generate those state matching funds by — this should look familiar — leasing the Illinois Lottery for immediate influx of cash; building a Chicago casino and expanding gaming, including slots at racetracks; diverting money from the state’s Road Fund, as well as the state’s main general fund, to back up the construction bonds.

The idea of leasing the lottery and expanding gaming, however, have gotten stuck in the legislative process before. And even if legislators trusted the governor to distribute the money as promised, they would risk alienating some voters by agreeing to privatize a state asset and expand gaming. On the other hand, they might win some supporters by rejecting the idea to raise taxes.

Trust is the underlying issue, however. Poshard said Democrats and Republicans in each chamber submitted priorities and requests, some of which were included in Tuesday’s proposal. But they also had the chance to weigh in on what it would take for them to trust the process of distributing the money, which Poshard and Hastert combined into “accountability provisions.” They include creating a “trust” fund (or lockbox) for revenue to be held until distributed, weekly leaders’ meetings, quarterly reports on status of the funds, a “good faith effort” on behalf of the governor to release the money as soon as money and spending authority are granted, and the trusty “memoranda of understanding,” essentially signed IOUs.

Quote Senate Majority Leader Frank Watson: “We need a lockbox that Houdini can’t get out of.”

But, here’s another telling Hastert quote: “The reason that we’re here is because there’s a stalemate, and we tried to come in —and sometimes fools rush in where angels fear to tread — but to try to bring the parties together. We have brought all five parties together, or, at least 4 and a half, at the table every day.”

Although leaders have been meeting with the governor and his negotiators since April, Illinois House Speaker Michael Madigan sent his majority leader, Rep. Barbara Flynn Currie, on his behalf. And Hastert said when he did meet with Madigan, Madigan listened but didn’t offer anything.

Meanwhile ...
The House started unveiling its version of a budget for the day-to-day operations of the state. That’s the annual budget as opposed to the multi-year capital budget. House Democrats, essentially, are advancing flat budgets for state agencies with some increases for union contracts and administrative costs. House Republicans, however, are banding together to oppose the plan.

Higher education is an exception in that it would get a 3 percent boost in funding, and
the committee unanimously advanced the higher ed budget plans.

We’ll have more on this tomorrow, when the Senate also could unveil legislation for its budget proposal.

Note: It doesn’t look like ethics reform will be called this week. We’ll keep you posted.

Monday, May 19, 2008

Beginning of the end?

By Bethany Jaeger
State legislators and the governor have 12 calendar days before the state Constitution requires them to approve a state budget for day-to-day operations. There’s a strange feeling in the Capitol, almost a calm before the storm, that casts a shadow over the possibility that they’ll adjourn on time. There’s always an end-of-session rush to try to meet the deadline or face the need to acquire more votes — read, Republican input. But there’s no telling whether the brooding storm will produce a workable budget plan or whether lawmakers will fail to compromise and take the state into another overtime session. Either way, the next two weeks will be chalked up with wish lists with controversial funding sources (or lack thereof). Budget hearings in the House start tomorrow, when the Senate also returns to the Capitol.

Race to the Capitol
The state’s operating budget is one challenge. The other is a capital program for infrastructure projects across the state, which has been held up for years. Legislators could soon receive a proposal for such a plan. Leaders are expected to meet with Gov. Rod Blagojevich’s appointed negotiators Tuesday, and they could unveil an actual proposal soon, says Rep. Jay Hoffman, a Collinsville Democrat and floor leader for the governor.

Local governments, school districts and transportation departments anxiously wait for billions of dollars of state capital funds. Representatives of the horse racing industry and the 40,000 employees it includes say they have a way to fund that capital plan.

The horse racing industry leaders are back at the state Capitol to plead for state assistance. This time they’re trying to convince lawmakers that if the state helps them, they can turn more profits and help fund a $20 billion infrastructure program for the entire state.

The argument is that horse racing in Illinois is losing horses, trainers, agribusiness, and lots of money tied to the industry to other states. Many of those states subsidize the industry and offer larger prizes for winning a race. Blagojevich signed a measure into law nearly two years ago that would have shaved 3 percent of the profits from the state’s casinos to support the ailing horse racing industry, but the measure immediately landed in court.

In addition to the challenge of deciding how to revive the horse racing industry, lawmakers have to weigh the complicated option of using gaming to fund a statewide capital plan. Numerous industry insiders and a few pro-gaming legislators held a news conference in the Statehouse Monday afternoon to pinpoint HB 4194 as the solution.

Democrats Reps. Lou Lang of Skokie, Bob Molaro of Chicago, Hoffman of Collinsville and Republican Rep. Roger Eddy of Hutsonville joined the packed news conference. The controversial measure, sponsored by Lang, would create a Chicago casino, expand slot machine positions at the state's nine existing riverboats and allow slot machines at horse racetracks. It’s estimated to generate $2 billion that could be used for capital. But not only would it take a while for the state to actually collect the money, no one really knows whether the plan could raise that much money given the slowing economy. While Lang said the measure would have enough votes to advance to the Senate, lawmakers hesitate to support any revenue-generating idea without a specific and trusted process for distributing that money. Trust wears thin in the Statehouse, to put it nicely.

Leaders plan to meet Tuesday with former U.S. House Speaker Dennis Hastert, a Republican, and Southern Illinois University President Glenn Poshard, a Democrat, who have toured the state to urge lawmakers to compromise on the governor’s $25 billion capital plan.

Hotel fraud?
By Patrick O’Brien
A chronically troubled hotel with deep Illinois connections is headed for more trouble.

State Treasurer Alexi Giannoulias said in a Statehouse news conference Monday that an internal audit showed former owners of a Springfield hotel cheated the state out of millions of dollars. He turned the case over to state and federal investigators to find out if any laws were broken.

“I have a feeling this is just the tip of the iceberg,” he said.

Giannoulias paid auditors to review financial records of the President Abraham Lincoln Hotel and Conference Center in Springfield after the state took over the hotel from local businessman Bill Cellini last spring. Cellini has been named but not accused of wrongdoing in the ongoing corruption trial of Tony Rezko, political fundraiser and advisor for Gov. Rod Blagojevich.

The state gave investors a multimillion loan to renovate the hotel in the 1980s, but they rarely reported a profit and, therefore, didn’t have to make loan payments most years.

Giannoulias said investors diverted about $2 million in hotel profits for personal use, including paying more than $700,000 for legal representation against the state. Under the terms of loan, the hotel conducted its own financial audits that were then turned over to the state for review, according to Giannoulias. This allowed the pocketing of hotel profits to go unnoticed, he said.

Giannoulias said investors owe $30 million on the loan, but since the state took over the hotel, it generated a $1.2 million profit in one year. He turned the case over to the Illinois attorney general and to the FBI.

Thursday, May 15, 2008

Who's going to connect the dots?

By Patrick O’Brien

The House and Senate continue to plan the next state budget, but there doesn’t seem to be much agreement on either side of the aisle or in either chamber about what it will look like.

With two weeks left before the deadline to adjourn the General Assembly, one prominent Democrat says the process is behind schedule. “There are things they should have been working on a long time ago,” said Senate Majority Leader Debbie Halvorson of Crete.

Halvorson also said the Senate should pass a “bare bones” budget and only pay for what the state can afford.

That greatly differs from what House Democrats are considering.

Rep. David Miller, a Lynwood Democrat, said the budget process in the House is being conducted to give individual members the chance to make a case for increased funding for particular departments so that the budget “reflects the needs of the state.”

The disconnect between the feuding budget proposals could indicate a “long, hot summer” like last year, said Rep. Mark Beaubien, a Barrington Hills Republican. “Everyone’s going their own separate ways. … The normal process of the budgeteers has totally broken down.”

Beaubien said the breakdown is by design — House Speaker Michael Madigan is pushing an overly optimistic, wish-list budget “designed to fail.” As a budget negotiator for his caucus, he said he believes Madigan may want to pressure the governor to accept an income tax increase to pay for increased funding for state agencies and new programs.

“The scenario being set up by Madigan is showing: ‘This is what we all want. We can’t get there. Let’s raise taxes,’” he said.

Steve Brown, Madigan’s spokesman, said the budget process wasn’t being conducted any differently this year than in past years, with one exception. “The whole dynamic of what negotiations are has changed radically in the past year.”

The other thing that’s different is that there are a lot more budget measures, which Beaubien estimated about 137. We’ll see whether that further complicates negotiations.

Brown also said some forecasts show growth in state funds, such as gasoline sales tax revenues. So they might not need a huge revenue boost.

The one thing both Miller and Beaubien see from their opposite sides of the aisle is that none of Gov. Rod Blagojevich’s revenue ideas make the short list.

That may be the only thing Statehouse partisans can agree on. The issues they don’t agree on is the problem.

Beaubien said the longer the session goes into overtime, the less lawmakers want to show up.

“Many legislators, frankly, have been through it once, and aren’t going to go through it again. You’re going to find a very hollow chamber.”

Wednesday, May 14, 2008

Human rights, ethics and impeacment

Illinois’ first openly gay legislator and the man who championed the state's law to prevent discrimination based on sexual orientation died yesterday. Larry McKeon was 63.

The Democrat announced his retirement in 2006 after 10 years in the House, where he represented northern Chicago neighborhoods. But Rep. Gregory Harris, who replaced McKeon, says his work resonated statewide. “I think a lot of people expected him to come down here and sort of be a single-note guy. He proved that he had the ability to represent the City of Chicago, he had the ability to represent the people of his district, he had a strong voice for people who were dispossessed and underserved all across this state — and really distinguish himself as a leader on a lot of key issues.”

House Speaker Michael Madigan described McKeon as a “tireless advocate on a wide range of social, health care and human rights issues,” including services for people with HIV and AIDS, as well as housing, mental health and developmental disabilities.

“He never shied away from confronting tough issues or seeking to bring disparate forces together,” Madigan said in a statement. “I admired his tenacity and his intellect.”

Born in Idaho, McKeon earned his bachelor’s and master’s degrees from California State University at Los Angeles and worked toward his doctorate at the University of Chicago. His 42 years of public service included working as a special adviser to Chicago Mayor Richard Daley, a lieutenant in the Los Angeles County Sheriff’s Department and an infantry officer in the U.S. Army.

He was diagnosed with AIDS and colorectal cancer in 2005. (See Illinois Issues magazine, September 2006, page 35.)

Civil unions
Harris also said he expects to call a measure that would allow civil unions in Illinois, which would grant legal rights related to emergency medical decisions, nursing home and hospital visits and funeral arrangements. In a Statehouse news conference, Harris joined senior citizens in advocating for the measure. He also said it would apply to same sex couples, although it's not the same thing as same sex marriage. He tried to advance HB 1615 last year but didn't get very far.

This is different. He said same-sex marriage is "off the table" this time around.

"There’s clearly not support for that. What I did hear from people is that they understood that committed couples need certain basic legal rights and responsibilities related to hospital visitation and health care decision making and funeral arrangements and those kinds of basic life issues. And that’s what civil unions is addressing.”

Ethics on the move

Sen. Don Harmon, sponsor of long-awaited ethics reform, said he hopes to call the “pay-to-play” legislation Thursday on the Senate floor. After a Senate committee advanced the measure this afternoon, Harmon said he couldn’t imagine too many people voting against it. We’ll have to see that to believe it.

“Impeachment” is a buzzword around the Capitol
by Patrick O'Brien
Four state lawmakers and about 150 state workers rallied on the steps of the Capitol today and called for the impeachment of Gov. Rod Blagojevich. In a rally organized by Springfield radio station WMAY, central Illinois Republicans criticized the governor over the slow pace of budget talks and the proposal to move 150 state jobs in the Illinois Department of Transportation from Springfield to southern Illinois.

Sen. Larry Bomke, a Springfield Republican, already sent a request for an impeachment trial to House Speaker Michael Madigan. Bomke accused the governor of playing political games with workers’ lives.

Note: Yesterday, the House approved a measure that would supplement the Illinois Department of Transportation budget. The agency is struggling to meet demands after the particularly harsh winter and increasing gas prices. The measure, sponsored by the governor’s floor leader, Democratic Rep. Jay Hoffman of Collinsville, includes extra money for the IDOT branch in Springfield.

Monday, May 12, 2008

Throw it into reverse

The Civic Federation lacks confidence in state leaders to rake in new cash and spend it wisely, which is partially why it withdrew its support of an income tax increase proposed last year.

The federation is a nonpartisan research body consisting of powerful corporate leaders in the Chicago area. It released a report today, reversing its position on a state income tax increase to generate new money to help pay down old and compounding debt.

“Last year, we supported a reasonable income tax increase if, and only if, it was tied to reform,” said Laurence Msall, president of the Civic Federation. He also serves on the Illinois Issues Advisory Board. “And some of those reforms would be very similar to what the Illinois General Assembly and the governor demanded of the Chicago Transit Authority, in terms of what they had to do before the state was support additional funding for them.”

Part of the Chicago Transit Authority deal negotiated in January included saving taxpayer dollars by increasing employee contribution rates, increasing the retirement age to 65 and shaving down health care benefits for future employees.

Last year, Msall said, the committee offered a modest income tax increase as an alternative to the Gov. Rod Blagojevich’s failed gross receipts tax on businesses. The recommendations started with momentum at the beginning of the year but deflated under a whole host of budget issues lasting throughout the year. And the legislature and the governor haven't shown signs of banding together behind reform any time soon.

“We have seen no evidence that there has been any serious effort, unlike three years ago when the governor stood up in a state budget address and said: ‘We have a big problem. We’re going to have to reform our pension benefit system,’” Msall said. “The General Assembly adopted only the most modest of those recommendations and then proceeded to take pension holidays, making the problem even worse.”

FYI: A special panel created by statute issued recommendations in 2005. You can read them here. Read more about the legislature’s pension holidays in Illinois Issues magazine here and in a state report here.

The Civic Federation's report says the governor’s proposed budget fails again to make “reasonable” payments to the pension system for public employees. As a result, the state’s compounding debt includes $44 billion in unfunded pension liabilities and another $24 billion in health care liabilities for retired state employees. Fun fact: That's about half of the state's entire budget.

The group also said it can’t support the governor’s proposed infrastructure program, which depends on privatizing the Illinois Lottery for an immediate influx of cash. The Civic Federation report said the proposal lacks a detailed plan for spending the money.

“There is no comprehensive improvement plan. There is a series of projects and lists,” Msall said. “You owe it to the public — and the General Assembly should demand — that they know what priorities are before they approve the extraordinary borrowing against the future revenue stream, which is what the lottery is.”

The governor’s budget office says the Illinois Board of Higher Education is responsible for evaluating and prioritizing its capital projects that would be included in a statewide infrastructure plan, and the state depends on a statutory formula for distributing capital funds for school construction projects. The Illinois Department of Transportation also has an extensive list of roads and bridges in need of repair, as well as a list for new roads and projects.

The Civic Federation’s overall message from last year still applies, however. The state should reduce, not increase, operating costs and new spending, which is why the group supports the governor’s proposals to cut most state agency budgets by 3 percent and to consolidate state agency functions to reduce administrative costs.

See “Shaky Business” in Illinois Issues, May 2007, to read about the business community’s support for a state income tax increase last year.

Thursday, May 08, 2008

“Disinfecting” Illinois government

by Patrick O’Brien
The Senate came another step closer to approving a “pay-to-play” ethics package today, but there still are some powerful obstacles, including doubts raised by Senate President Emil Jones Jr. and his allies.

Just before a committee hearing today, Jones proposed a change that proponents say could kill the measure. He withheld the amendment, however, to the relief of supporters.

“I’m much more hopeful than I was an hour ago,” said Cindi Canary, director of the Illinois Campaign for Political Reform, after the committee advanced the proposal to the full Senate. She said Jones’ revision is a “solution without a problem.”

Jones described the amendment as an attempt to improve the bill. It would expand the original proposal to ban state contractors from giving political contributions to all officeholders or candidates. The original plan, conversely, would only limit contractors from donating to the officeholders who grant the contracts.

Canary said the wholesale ban on state contactors’ right to contribute to any candidates in Illinois could be unconstitutional.

Jones and his ally, Sen. Rickey Hendon, a Chicago Democrat, said there’s a “gaping loophole” in the proposal because it wouldn’t ban political contributions from state contractors to statewide political parties, which often distribute money to members’ campaigns.

Sen. Don Harmon, an Oak Park Democrat sponsoring the original plan, said full disclosure of all political contributions from contractors would make contractors and elected officials far less likely to trade state business for political contributions.

“Sunshine is the greatest disinfectant,” he said.

Hendon told reporters he will vote for the measure when it comes up for consideration in the Senate, which likely is to be next week.

The House and the Senate went home for the weekend and will return Tuesday, May 13. Countdown: The House has 12 session days and the Senate has 11 session days left before the constitutional adjournment of May 31.

16-hour shifts
by Patrick O’Brien
One of the state’s largest unions is urging the Senate to release a measure that would outlaw mandatory overtime for state workers.

Jessica Becket, a certified nursing assistant as the LaSalle Veterans Home, said she drove her car into a ditch last year, exhausted from a 16-hour shift.

Becket and co-worker Kathy Reno said the average workweek of employees in their department was 55 hours because of staffing shortages and that 12-hour shifts were commonplace.

The Illinois Department of Veterans’ Affairs agreed with the workloads at LaSalle cited by Becket and Reno, saying the unions’ contract allowed for the mandatory overtime.

Both Becket and Reno said as many as seven workers at the home were fired for refusing to work overtime, and Becket herself was suspended.

Sen. John Jones, a Mount Vernon Republican, said he's received complaints from prison employees about the policy and the impact on job performance and wellbeing.

“Somebody is going to get seriously hurt in one of these institutions,” he said.

Henry Bayer, director of the American Federation of State, County and Municipal Employees Council 31, said the problem affects about 22,000 workers, mostly in the state’s prisons, mental health facilities and veterans’ homes.

Bayer said a report the union wrote based on state overtime statistics shows Illinois paid $62 million for overtime last year.

Bayer and a bipartisan group of Senators called on Senate President Emil Jones, a Chicago Democrat, to allow the measure to be voted on by the full chamber. The proposal has 34 Senate sponsors.

Watch Illinois Issues magazine in June for more.

Wednesday, May 07, 2008

Shifts at the top

Update: Sen. Don Harmon, the Oak Park Democrat sponsoring the agreed upon ethics reform, said last night he hopes to call the measure in committee today.

Senate Majority Leader Debbie Halvorson, a Crete Democrat, was replaced on the powerful Senate Rules Committee by Sen. Rickey Hendon, a Chicago Democrat, today.

The committee controls which pieces of legislation advance to floor debate and which are held.

Halvorson said she was surprised and that it wasn’t her decision, but she felt as though the move by Senate President Emil Jones Jr. would allow her to refocus on serving as majority leader in the last month of scheduled session when so many things hang in the air.

“The Senate president felt that it was a distraction because every little thing was taken out of context, put into somebody else’s context and was keeping us from doing what was important,” she said.

For the past few months, Halvorson received criticism for holding in the Rules Committee a constitutional amendment that would allow voters to decide whether to recall elected officials. A broader measure eventually was called for a vote but narrowly failed on the Senate floor. Halvorson also was called a roadblock to highly anticipated ethics reform that would ban state contractors from donating to the officeholders who grant the contracts. The ethics reform could come up for a vote soon, according to House and Senate sponsors who announced an agreement last week.

Halvorson said she supported each of those measures despite being on the opposite side of the issues from the Senate president.

“It’s no secret that I was for the recall,” Halvorson said. “I was for the pay-to-play legislation. I’m anti-pay raise. I think I was causing a few too many problems.”

Cindy Davidsmeyer, spokeswoman for the Senate president, added: “She needs to focus on the issues that concern her Senate district and not be responding to claims that are baseless. In deciding to take her off Rules, this will allow her to better focus on the issues in her Senate district.”

Davidsmeyer added that Halvorson's bid for Congress has nothing to do with the decision, although Halvorson said the "unnecessary" controversy over highly publicized legislation wouldn't have happened if she weren't running for Congress.

Halvorson faces Republican Martin Ozinga, president of a concrete and construction firm, and Green Party candidate Jason Wallace to replace Republican U.S. Rep. Jerry Weller in the district southwest of Chicago.

Note: The House rejected granting pay raises to its members this afternoon. The Senate must do the same for the raises not to take effect.

Tuesday, May 06, 2008

Let the countdown begin

By Patrick O'Brien
Illinois very likely is heading toward another overtime session. The House has 14 working days until the constitutional deadline for adjournment, May 31. The Senate has 13. Given that some legislative days have been cancelled — the House canceled this Friday, and the Senate cancelled today so some members could work for the presidential campaign of U.S. Sen. Barack Obama in Indiana — legislators don’t seem rushed to finish business by May 31. (After that, both chambers need a three-fifths majority to approve legislation.)

History could be telling. David Dring, spokesperson for House Minority Leader Tom Cross, says the budget process mirrors last year’s, when each chamber passed a competing budget and a stalemate ensued. Lawmakers were called to Springfield at least once in all 12 months last year. This session, there haven’t been leaders’ meetings on the budget, yet. Leaders have met three times to discuss a statewide capital plan, although there’s little progress to report.

Dring added that he still thinks a May turnaround is possible if the political will is there. “A lot can happen in three weeks around here if people work together.”

Thursday, May 01, 2008

Anticlimactic

By Bethany Jaeger
Illinois citizens will not have a chance to vote on whether the state Constitution should be changed to allow voters to recall elected officials, including judges. The state Senate narrowly rejected a measure, Senate Joint Resolution Constitutional Amendment 70, that would have placed the so-called recall amendment on the ballot in November. (See more here and scroll down.)

There’s little to no chance that the General Assembly can approve any measure to pose a constitutional amendment to voters this year, given that the deadline to put those questions on the November ballot is Sunday, May 4. Neither chamber will be back in session until May 5.

It’s been a series of dramatics since the House approved a narrower measure to ask whether voters should be able to recall only constitutional officers and state legislators (it's House Joint Resolution Constitutional Amendment 28). The Senate hijacked that bill and “improved” it to include judges and local officials. Top Senate Democrats, however, opposed the addition of judges and withheld their votes Thursday. The measure failed 33-19, with 2 voting present. It needed 36 votes to pass.

Senate Minority Leader Frank Watson said it was a travesty that the Senate stymied both measures. “This is truly a sad day in Illinois, that we’re not giving people the opportunity to have a say in what most people would suggest to be just competent government.” The sponsor, Sen. Dan Cronin, an Elmhurst Republican, said after the vote that fear ruled the day. “The people who voted against this, this is about their fear of being held to a higher standard. The world’s changing. They need to change with it.”

Opponents, including Democratic Sen. Mike Jacobs of East Moline, said although he’s had some serious disagreements with the current governor, recall is not the way to go. “The notion of recall is better suited for cars than for the governor of Illinois,” he said during floor debate. “Forget recall. The governor of Illinois should do the right thing, and that’s resign.”