Campaign finance "redo" in limbo

By Bethany Jaeger
Two months ago, Democratic and Republican legislators stood next to Gov. Pat Quinn and agreed to start over on drafting a bill that would — for the first time in Illinois — limit the amount of money individuals and political organizations could donate to political campaigns. They vowed to present a new version during this month's legislative veto session. But the bill introduced by House Speaker Michael Madigan on Wednesday has been called a step backward by reform advocates.

Madigan's bill, Senate Bill 1466 (amendment 2), was still “under review” at the end of Wednesday’s legislative session, the first of six days scheduled over the next two weeks. SB 1466 still would limit donations to $5,000 from individuals, $10,000 from corporations, labor organizations and associations, and $50,000 from political action committees or other candidates. The limits also would apply to the election cycle rather than the calendar year, one change from last spring’s House Bill 7 (background here).

Reform advocates oppose Madigan’s version primarily for one reason: It would continue to allow unlimited financial support to candidates from statewide political parties and legislative caucuses.

“Not having a limit on the party caucus and the legislative leaders is not a consistent with meaningful reform,” said Peter Bensinger, co-chairman of the Change Illinois reform coalition. “It restricts everybody else but the leaders. We don’t think it’s going to restore public trust.”

Kent Redfield, a campaign finance expert with the University of Illinois at Springfield and the Illinois Campaign for Political Reform, echoed statements by Republican Rep. Ed Sullivan of Mundelein. He said Madigan’s version goes backward from last spring’s version in HB 7. According to Redfield, Madigan last year gave $1.6 million to the Democratic Party of Illinois, of which he also chairs. Under HB 7, the speaker would only have been able to give $90,000 to the Democratic Party of Illinois. The current bill would allow unlimited transfers. “We’re going back to the way it is,” Redfield said.

Bensinger added that it also could discourage individuals from challenging existing officeholders (his testimony is here). While all candidates would be able to collect limited amounts from individuals and organizations, newcomers would be at a disadvantage, compared with incumbents who had unlimited financial support from party leaders. “The balance of power becomes more entrenched in Springfield in the hands of the few rather than getting the control of the electorate in the districts,” he said.

When testifying to a House committee Wednesday morning, Madigan said the intent was to “limit money flowing into the campaign system and reduce influence of outside groups and lobbyists.” And he defended the role of political parties by saying they’re not a special interest promoting a cause.

“The entire basis for existence for a political party is to promote candidates running under its banner. Their fate in an election is inherently intertwined with that of their candidate. Thus, there is really no meaningful distinction between a party spending on behalf of its candidates and expenditures made by the candidates themselves.”

The speaker added that his version “would place Illinois squarely in the mainstream of campaign finance reform” because 25 states allow political parties to make unlimited contributions to their candidates in general elections. And two of those states have some limits during primary elections. “One half of America provides unlimited contributions in the general election,” he said. See a National Conference of State Legislatures chart here.

The bill is currently on hold, with some technical errors that could create a loophole for reporting requirements, said Cynthia Canary, executive director of the Illinois Campaign for Political Reform.

The bill also is in limbo because it lacks Republican support, which is necessary to satisfy the three-fifths supermajority of votes needed during the veto session (because, as currently written, part of the bill would take effect in 2010, while other parts would take effect in 2011).

“I don’t think you’ll see a lot of support,” House Minority Leader Tom Cross said after a lengthy meeting behind closed doors with the governor and all four legislative leaders. “I think people see it for what it is: It’s not a bill that regulates us. You’ve got a lot of power invested in the leaders of the four caucuses, including ours. And we just don’t see any movement in that area. That’s disappointing.”

Fewer votes will be needed once the legislature’s spring session starts in January.

Rather than accept the bill now and work on limiting contributions from party leaders later, Bensinger said: “That’s the question: Will someone ever come back to the piece later? I don’t think Illinois should take halfway step measures. This is like a house without a roof.”

Like HB 7, Madigan’s version still would:

• Require candidates to report contributions and expenditures four times a year, as opposed to the current twice a year. Donations of $1,000 or more would have to be reported within two business days throughout the entire year.
• Allow the Illinois State Board of Elections to conduct random audits, to investigate alleged violations of contribution limits or reporting requirements and to waive fees if the mistakes were found to be inadvertent.
• Form a task force to study and make recommendations on a public financing system for judicial elections.

No Games for Chicago

By Bethany Jaeger
Chicago’s quest to host the 2016 Summer Olympic Games is over. The Windy City was eliminated in the first round of voting of the International Olympic Committee in Copenhagen this morning. Other cities in the running were Rio de Janeiro, Madrid and Tokyo. Tokyo was eliminated in the second round of voting. Rio won the final vote.

Read about the positives and negatives of a Chicago Olympics in Illinois Issues magazine’s “Going for the gold.” Some saw a lucrative opportunity, while others saw long-term fiscal and social costs. The activist group No Games Chicago said tax dollars would be better spent on affordable housing, school construction and mass transit in underserved areas of the city. The Chicago Fraternal Order of Police expressed concerns about public safety after the city’s long string of gun violence.

Chicago’s bid has been led by Mayor Richard Daley and Patrick Ryan, Chicago 2016 chairman and chief executive officer and a former Fortune 500 insurance executive. They were joined in Copenhagen for a last-minute pitch by President Barack Obama and First Lady Michelle Obama, as well as Oprah Winfrey and Olympic athletes.

The loss means a state law enacted in April won’t be needed. It would have offered a $250 million guarantee if the Games’ budget went overboard.

October issue: Jerry Stermer, "Voice for the man"

Get a glimpse of who helps shape Gov. Pat Quinn's agenda and style in the October edition of Illinois Issues magazine. Maureen McKinney profiles Jerry Stermer in the "Voice for the man."

Read the third and final installment of a three-part series on the plight of nonprofits in Illinois. Crystal Yednak writes, "Joining forces: To prepare for an uncertain future, nonprofits collaborate rather than compete."

And if you want to read about the anticipated effects of this year's state budget banking on delaying payments to certain Medicaid providers, read my feature, "Pay delay."

As always, our columnist Charlie Wheeler gives valuable context and analysis about what legislators and the governor have done by booting the tough choices into next year.

I also provide analysis about how "small budget cuts hit home in a big way." Case in point: grant-funded programs for people with disabilities and college students are in limbo.

And executive editor Dana Heupel gives the national context to Illinois' budget woes in his monthly column.

Our print readers also can read two guest essays: the first by Brent Never, who adds to the picture of how nonprofits are at the mercy of the state; the second by Jack Van Der Slik, who analyzes why politicians shrink from raising taxes as long as they can. Also available in print-only are more articles about campaign finance, the University of Illinois Board of Trustees, a lawsuit over Chicago's parking meters, the closure of Howe Developmental Center, the attack of the waterhemp weed and other Illinois issues.

AFSCME layoffs stopped for now

By Bethany Jaeger
About 500 state employees who anticipated losing their jobs Wednesday are on hold. A southern Illinois judge this morning ordered the administration to refrain from laying off employees pending more negotiations with the state’s largest public employee union.

Gov. Pat Quinn’s office said it plans to appeal the ruling, leaving one segment of his deficit-reducing plan — and the 2,600 employees who would be laid off — in limbo.

The American Federation of State, County and Municipal Employees Council 31 filed suit in Johnson County, where Vienna Correctional Center would lose positions. It argued that the job cuts would jeopardize public safety and cause harm to its workers if layoffs took place before the administration settled a dispute over the union’s concerns.

Judge Todd Lambert of the First Judicial Circuit Court in Johnson County ruled that AFSCME met its burden of proof. He wrote in his order, “The risk of employees targeted for layoff or laid off far outweighs any damages or other harm the state may suffer by having to delay the layoffs pending arbitration of the pending grievances.”

Lambert also wrote that the union’s grievances “are not frivolous and reflect a genuine dispute between the parties.”

AFSCME argues layoffs would cause irreparable harm if they took effect without completing negotiations about how the process of layoffs would trickle down. The complex process allows senior workers to bump less-experienced workers out of their jobs, starting a domino effect of workers who have options to take other positions or accept reduced pay, for instance. Anders Lindall, AFSCME Council 31 spokesman, said union members would be forced to make life-altering decisions without knowing all of their options.

“You can’t unscramble the eggs,” Lindall said. “Once employees make these choices, if we subsequently prevailed on our grievance, the state could not easily or at all just go back and restore the status quo.”

AFSCME’s grievances also protest the state’s contracts with private firms that do work that the union says state employees could perform. Lindall cited a $14.5 million contract with a private company that provides temporary clerical workers. Meanwhile, the state plans to lay off state-employed clerical workers in six agencies. “That $14 million contract should be reduced or eliminated and state employees kept on the job," Lindall said.

Quinn’s administration originally proposed that AFSCME members take unpaid days off or forego annual raises to help prevent the need for more layoffs. The union would not agree to concessions, leading Quinn to say he had no choice but to lay off 2,600 employees.

The court order specifically applies to AFSCME members, many of whom work in the Department of Corrections, as well as in the departments of Revenue, Human Services, Healthcare and Family Services and Commerce and Economic Opportunity.

More layoffs were scheduled to take effect October 31 from the Illinois Arts Council and the departments of Natural Resources and Aging, according to Central Management Services, the personnel and procurement agency.

The governor’s office said in a statement that it “carefully followed every step required in the AFSCME contract” and had no choice. “Illinois is experiencing an unprecedented economic crisis, and budget reductions must be made, including cuts to the state’s administrative and personnel costs. Our plan includes responsible layoffs that do not jeopardize public safety.”

The administration still is in negotiations with other public employee unions, including the Service Employees International Union, the Illinois Federation of Teachers, the Teamsters and the Laborers.

The elusive standard of charitable care

By Bethany Jaeger

The Illinois Supreme Court has to decide which standard to use when considering a highly anticipated case about what not-for-profit hospitals have to do to qualify for local property tax exemptions. While the case specifically deals with Provena Covenant Medical Center in Champaign County, the court decision has potential to affect about 160 nonprofit hospitals throughout Illinois.

We previewed the six-year-old case in the September edition of Illinois Issues magazine. Provena filed for a property tax exemption in 2002 based on its status as a charitable organization, but the Illinois Department of Revenue denied the charitable exemption two years later. The hospital later applied for an exemption based on its status as a religious institution. (See a timeline of the case here.)

Both sides presented oral arguments before the Illinois Supreme Court this morning with drastically different beliefs about what should count when considering charitable exemptions and what evidence the court should consider in deference when determining whether Provena qualifies for that property tax exemption.

On one hand, Provena’s lawyer, Patrick Coffey with Locke, Lord, Bissell & Liddell in Chicago, argued that the justices should undertake a brand new review of whether the denial of the hospital’s charitable exemption violates the state Constitution. The state charter gives the General Assembly authority to exempt “property of the state, units of local government and school districts and property used exclusively for agricultural and horticultural societies, and for school, religious, cemetery and charitable purposes.”

On the other hand, the Illinois Department of Revenue, represented by Assistant Attorney General Evan Siegel, argued that the justices should give deference to the lower administrative orders issued by department director Brian Hamer and affirmed by the 4th District Court of Appeals. The thinking is that the Department of Revenue has expertise in property tax matters and was the authoritative body reviewing evidence provided by 15 witnesses and two experts during administrative hearings, so the court should give a high level of respect to the administrative findings when reviewing the case.

Which standard the court chooses affects how it would consider a 2004 recommendation of an administrative law judge. After the administrative hearings, the administrative law judge found that the hospital met the standard for charitable exemption. Hamer, however, disagreed. He had the final administrative opinion to reject the tax exemption. He deemed some of the evidence irrelevant and decided that Provena didn’t qualify for a tax exemption because it dedicated only 0.7 percent of its revenue that year to providing so-called charity care to 302 patients out of 110,000 patients admitted. “I find that the property does not qualify for the charitable institution tax exemption because the evidence is clear that this property is not used exclusively for charitable purposes,” he wrote.

The two sides further disagree about whether a certain percentage of charitable care should be a deciding factor in its tax-exempt status. Coffey argued that the standard for whether not-for-profit hospitals qualify for property tax exemptions should not be whether the hospitals designate a certain percentage of their income to providing free care to needy patients.

“That has never been the requirement, and it shouldn’t be the requirement,” he said to five of seven justices. Justices Thomas Kilbride of Rock Island and Rita Garman of Danville recused themselves and did not participate in the oral arguments.

Instead, Coffey said the determination should be on a case-by-case basis and should count the hospital’s total contribution to the community. “It’s not out of bounds to consider how much free care was given, but they have also gone beyond.” For instance, Provena operates Crisis Nursery, a 24/7 child abuse prevention and support service and provided more than $13.5 million on such “community benefits” in 2002, according to the hospital’s Supreme Court filing.

Siegel, however, argued that the dominant factor when deciding charitable exemptions is the primary use of the property. He refers to a six-point test established by a 1968 Illinois Supreme Court case Methodist Old Peoples Home v. Bernard Korzen. (Read the six criteria for nonprofit institutions in our September issue.)

“It doesn’t matter whether an organization itself … is a charitable organization,” Siegel said. “What matters on that analysis is whether it is using the property for a charitable purpose.” He added that tax exemptions are granted on an annual basis. “Just because you have it for one year doesn’t mean you have it for every year.”

Justice Robert Thomas asked whether the state expected the court to set a minimum requirement of a certain percentage of charitable care. Siegel said no, that the court already determined in 1907 that a hospital must provide a “substantial amount” of free care. “All the court need do in this case on this critical factor is decide that 0.7 percent revenues in a year that only 302 people out of 110,000 admissions obtained free and discounted care is not substantial.”

In addition to the charitable exemption, the two sides differed about whether the religious exemption should be part of the court’s consideration because of a discrepancy in the record.

Chief Justice Thomas Fitzgerald questioned several times how Hamer could have ruled that Provena did not qualify for a charitable exemption based on its religious affiliation when the administrative law judge never addressed that question. “I’m still puzzled at how the director based his finding upon a statement that wasn’t there.”

“Well, it was mistaken, absolutely,” Siegel responded. “But I believe that he read the [administrative law judge’s] opinion as not giving much weight to the religious exemption.”

Coffey argued that the administrative law judge did not address the religious exemption because she already found that an exemption was warranted as a charitable organization, and Hamer rejected the religious exemption without explanation.

In addition to differing over other details, the two sides predominantly argued that their opponents were trying to change the standard of determining whether hospitals qualify for property tax exemptions.

“Provena [provided] free and reduced care to just 302 patients,” Siegel said. “That’s not a large proportion. The primary use of the property is treatment of patients with insurance. By arguing that 0.7 percent is sufficient, Provena is trying to alter the constitutional standard. And it is for this court, not the legislature, to determine what constitutes a constitutional charitable use.”

Coffey countered that the state is the one trying to base a decision on a standard that has never been used by the court, referring to the use of a certain percentage needed to qualify for a tax exemption. He said a proposal to set a minimum percentage of charitable care should go through the legislative process, not the court system.

It is up to the court to decide which standard to use. Although Justices Kilbride and Garman recused themselves and are not required to disclose their reasons, a majority opinion still requires four justices, according to Joseph Tybor, Illinois Supreme Court spokesman.

Plan to release 1,000 prisoners unveiled

By Bethany Jaeger
About 1,000 prisoners who committed non-violent crimes will start being released from the Illinois Department of Corrections “within a couple of weeks” as a way to ease overcrowding and budget constraints, according to a plan announced today by department director Michael Randle.

The announcement came with a $4 million boost from the governor’s office. About $2 million of that is slated for so-called mandatory supervised electronic detention, or releasing non-violent drug offenders early from prison and giving them ankle bracelets and parole officers.

Reducing the average daily population by 1,000 could save the agency about $5 million a year, according to Januari Smith, spokeswoman for the corrections department. At one time, it was rumored that the state could release between 5,000 to 10,000 prisoners, which would have included more categories of prisoners than Randle intends to make eligible.

Randle plans to be stricter than state statute by excluding sex offenders, parole violators, inmates with active protective orders and inmates with a history of domestic violence from being eligible for early release. Since 1993, state law has allowed certain nonviolent offenders to be released within 90 days of their parole dates as long as they served home detention, including wearing electronic monitoring devices.

The concept of early release is supported by the John Howard Association, a Chicago-based prison reform group, as well as Treatment Alternatives for Safe Communities. In a statement, president of TASC, Pamela Rodriguez, said: “In our extensive history working with the justice system, we have found that alternatives to incarceration are far more effective ways to reduce crime for the vast majority of non-violent, short-term drug-involved offenders.”

Bill Ryan, a prison reform activist since 1994 and publisher of the prisoner-written newspaper Stateville Speaks, said for my September column for Illinois Issues that he is “definitely in favor” of early release. However, he added, “my concern is that many of the people leaving prison on electronic monitoring will require some sort of supportive services, more than just having an ankle bracelet and a parole officer.”

Dubbed the Illinois Crime Reduction Act of 2009, the other part of the package will dedicate an additional $2 million to community-based services in an attempt to help non-violent drug offenders stay out of jail.

According to the department, the prison population has increased from 18,000 in fiscal year 1986 to nearly 46,000 in fiscal year 2009, much of it attributed to the higher rate of imprisonment for non-violent drug offenders.

Friday’s announcement did not mention layoffs of prison staff, but Smith said 419 prison workers already have received their notices and will be terminated September 30. Gov. Pat Quinn’s administration has said it will have to lay off as many as 1,000 corrections employees because it could not strike an agreement with Council 31 of the American Federation of State, County and Municipal Employees to take furlough days or forgo their annual raises. Some prison workers could be eligible to fill vacancies in other prisons.

The amount of overtime hours worked, however, has been increasing and cost the department $37 million two years ago, according to a recent audit. In 2005, the department employed 13,670 people, according to the Illinois Criminal Justice Authority. In August, Smith said the department employed 10,951.

Super-max prison reforms proposed

By Bethany Jaeger
One of the state’s maximum-security prisons designed to hold the most disruptive and violent offenders has a new set of rules that are intended to give inmates incentives to improve their behavior so they can return to less restrictive facilities.

The new Illinois Department of Corrections director, Michael Randle, issued a 10-step plan for reforming Tamms Correctional Center, which is at the very southwestern tip of the state. It houses an average of 432 men, costing an average of $67,000 each, according to the department. Male prisoners arrive at Tamms if they pose a threat to other inmates, themselves or prison staff. It’s one of six maximum-security prisons in Illinois and is intended for short-term placement until inmates are stable and able to return to the general prison population.

The “supermax” prison has been under scrutiny from human rights advocates and a volunteer group known as Tamms Year Ten for what it deems as prolonged solitary confinement and poor treatment of mentally ill prisoners.

Appointed by Quinn in May to replace former director Roger Walker, Randle was born in Chicago but worked 19 years in the Ohio Department of Rehabilitation and Corrections, most recently as assistant director. His first assignment in Illinois was to review Tamms.

His 10-step plan announced today in Chicago includes a full mental health evaluation of all Tamms prisoners within 30 days of their arrival. Clinical staff also will make weekly rounds of all areas throughout the prison, not just the mental health unit, to detect whether inmates’ conditions worsen or if they become suicidal.

Another significant change is the new process for reviewing prisoners who are to be transferred from a lower security prison to Tamms. Hearings will be conducted to allow inmates to rebut information that led them to be placed in Tamms, and they would be able to appeal their placement there. All hearings would be recorded.

Other changes include:

• Inform each inmate of an estimated time they’ll stay at Tamms and how they can earn privileges and eventually transfer out to a less restrictive prison.
• Enhance incentives for good behavior, including earning the right to use the telephone or spend more time out of their cells.
• Begin offering General Educational Development testing.
• Implement congregate religious services for inmates.
• Rescind some of the restrictions on printed materials.
• Develop a plan to allow inmates access to a “step down” program, which would help at-risk inmates transition from Tamms to the general prison population.
• Plan a media, legislative and public outreach program that includes a visit to Tamms.
• Reexamine the population of inmates having served extensive time at Tamms to see whether they are eligible to transfer out. Some have been at Tamms since it opened in 1998.

Laurie Jo Reynolds, organizer of the Tamms Year Ten grass-roots campaign, says Randle’s reforms move in the right direction. The establishment of a transfer review hearing, for instance, is significant, she said. “Over half the prisoners who are there were not actually convicted of a crime in an Illinois prison, and many of them did not know the reasons for their placement. So this is a welcome reform.”

But she added that the reforms in general don’t go as far as desired in House Bill 2633, sponsored by Rep. Julie Hamos, an Evanston Democrat. (Hamos put the bill on hold in May because Randle recently took over, and she wanted to see what changes he would make.)

Hamos’ bill, as well as Tamms Year Ten, Amnesty International and other mental health advocates in Illinois, have sought an independent monitoring of mental health diagnosis and treatment of the prisoners.

“Our concern is that there are a lot of mentally ill prisoners there who have not been properly diagnosed or treated, and there’s nothing in the plan that would provide a safeguard for those prisoners,” Reynolds said.

According to Randle, who said he hasn’t considered an independent monitor, all staff are trained in recognizing the symptoms of mental illness or other psychological needs on an as-needed basis. “As far as I’m concerned, I don’t think it’s necessary for us to do that,” he said.

Reynolds said she also hoped to see clear criteria outlining reasons for transferring inmates to Tamms, rather than using the current case-by-case approach. She said she continues to work with other advocates and legislators to consider whether legislation should codify the changes so they remain permanent regardless of whether the administration changes.

Randle said he doesn’t know whether legislation would be needed because the changes are happening now and are intended to be permanent. However, he added: “I think it’s important to point out that a lot of this is contingent on the offenders’ behavior. … If the guys behave appropriately and do the right things, certainly these things will continue. If we begin to have issues that come up as a result of this, then certainly we need to be in a position to take a look at these.”

Reynolds said Quinn did a great thing by appointing Randle. “I feel like he is committed to long-term reforms and to changes, which are beneficial to both public safety and to prisoners and to lowering recidivism,” she said. On the other hand, she added, “this list of 10 things could end up being really superficial or they could end up being profound, depending on how they’re implemented. So we can only look forward to dialogue as we go forward.”

Chris Kelly pleads guilty to O'Hare scheme - UPDATED UPON HIS DEATH

By Bethany Jaeger
Christopher Kelly, a close adviser and fundraiser for former Gov. Rod Blagojevich, died Saturday, September 12, just days before he was to report to federal prison to serve at least eight years for two of three criminal cases against him. He was 51.

Law enforcement officials reportedly were looking into a drug overdose.

Kelly would have been a key figure in the ongoing corruption trial of Blagojevich, scheduled to go to court in June 2010. Kelly was indicted as part of “Blagojevich Enterprise,” an extensive scheme that allegedly began in 2002 to use the governor’s office for private and political gain, including auctioning off the U.S. Senate seat once held by President Barack Obama. Kelly was indicted along with the former governor; his brother, Robert Blagojevich; former campaign manager and lobbyist Alonzo Monk; Springfield lobbyist William Cellini; and former chief of staff John Harris. Kelly pleaded not guilty to those charges.

Shortly before his death, however, he pleaded guilty today to two counts of mail fraud in one of three federal indictments against him. But it's unknown whether he was cooperating in the ex-governor's ongoing corruption trial.

Read his plea agreement here. The Burr Ridge resident UPDATED: was supposed to report to jail September 18 and agreed to forfeit $450,000 for a scheme of rigging roofing contracts with two major airlines and using illegal kickbacks for personal use. On top of a three-year prison sentence for a separate tax fraud case, his plea Tuesday calls for a nearly five-year sentence.

Kelly pleaded guilty to rigging bids to steer $8.5 million in inflated contracts for roofing work done on American Airlines and United Airline facilities at O’Hare International Airport between 1998 and 2006. The scheme benefited BCI Commercial Roofing Inc. in Markham, of which he is president and owner.

About $1 million of the kickbacks went to repay gambling debts and a home loan, according to the plea. Some of the kickbacks also went to entities associated with Tony Rezko.

Kelly originally was charged with 11 counts of mail fraud and six counts of money laundering for the scheme.

• His December 2007 indictment charged him with using corporate funds from his roofing and consulting firms to pay illegal gambling debt. He received three years in prison for those charges.
• His February 2009 indictment includes the O’Hare kickback scheme. His plea seeks nearly 4.5 years more on two counts of mail fraud.
• He still faced trial for his involvement in Blagojevich’s ongoing corruption case, scheduled for court June 2010. That indictment is here.

UI board of trustees complete

By Bethany Jaeger
After months of being under a cloud of an alleged scandal that led seven trustees to resign, the University of Illinois board of trustees now has all positions filled before its first meeting of the school year.

Gov. Pat Quinn appointed five new trustees this morning, filling a total of seven seats that were vacated. Two trustees refused to resign and remain on the board. The board has been under public scrutiny since June, when The Chicago Tribune exposed a clout-heavy admissions process that favored more than 800 students over some more qualified applicants.

The five new trustees, appointed to six-year terms, are all University of Illinois alumni. They include:

• Karen Hasara of Springfield (Republican) is a former mayor, state legislator (House and Senate, 1980-1993), local mass transit trustee, circuit court clerk, county board member, real estate executive and teacher.
• Timothy Koritz of Roscoe (Republican) is an anesthesiologist, a former U.S. Air Force flight surgeon and officer in charge of a space shuttle emergency medical response team.
• Edward McMillan of Greenville (Republican) is an agribusiness executive. He also is a reappointed trustee. Quinn appointed him in March, but he never received Senate confirmation.
• Pamela Strobel of Winnetka (Democrat) is an Exelon Corp. executive and lawyer.
• Carlos Tortolero of Berwyn (Democrat) is founder of the National Museum of Mexican Art and a longtime arts advocate.

They join Christopher Kennedy, a Democrat and Chicago’s Merchandise Mart Properties president, and Orland Park’s Lawrence Oliver II, chief legal counsel for the Boeing Company. He lists himself as an "independent." Quinn appointed them August 26.

Democrats Frances Carroll and James Montgomery remain. Quinn said last week he would not force them to resign because he wanted to avoid a lengthy legal battle over his executive powers to do so. Both were appointed by former Gov. Rod Blagojevich. Frances’ term is set to expire January 2011, Montgomery’s January 2013.

Former federal Judge Abner Mikva, who led Quinn's special panel to investigate the allegations, said yesterday that the governor handled the situation well. “It would be foolish to waste the resources engaging in a long court fight to remove [Trustee Montgomery] and Trustee Carroll. They didn’t do much while they were on the board, so I don’t think they’ll do much harm if they stay another year or two. It just leaves them with two spots that could be filled by better trustees.”

However, Mikva said he anticipated the board’s and the university’s quick and complete recovery.

New trustee Hasara said she did not think Frances’ and Montgomery’s continued service would be an issue. “It’s what it is,” she said this morning. “And I can only believe that they, like the rest of us, have what’s good for the university at heart. And they will cooperate as all the other board members in trying to solve this problem.”

She does expect the job to be a challenge. “But I don’t want to overestimate that challenge. I think that this looks to me like it’s a wonderful board of very, very competent people. And I feel very confident that this board will be able to get this solved and get it behind us because there are so many important things going on that the campuses of the University of Illinois, and no one wants to see something like this drag out.”

McMillan, whom Quinn appointed in March to fill a vacancy, said he attended only a few trustee meetings before resigning at the recommendation of Quinn’s investigative panel. He said he had no angst when the Tribune’s investigation broke because he had no part in the process and was never mentioned as being involved. He resigned but informed Quinn he would like to continue serving on the board if the governor saw fit.

“I’m pleased the governor has the confidence in me to let me continue,” he said this morning.

Going forward, McMillan said he was pleased to see such a diverse group of trustees from various professions and geographies. While having so many new members without a chairperson is going to pose challenges, he said he expects the first few items of business to include electing a new chair, establishing a new code of conduct and developing new ethics standards for the board. Those could be on top of the state and university ethics rules already in place, he sad.

“The most important thing is the university and making sure the integrity of this university and its global, world-class capability and research and education and outreach is reinforced and sustained,” he said, “so there’s no question going forward of, ‘Do we deserve the reputation that we’ve had in the past, and can we earn it in the future?’ I think we’ve all got to form together as a group and make sure we do that.”

The board has 13 members, including the governor and three students. No more than five can be from the same political party. The board oversees the university’s three campuses in Chicago, Champaign-Urbana and Springfield.

Hynes challenges Quinn and his tax plan

By Bethany Jaeger
The Democratic primary election between Illinois Gov. Pat Quinn and Comptroller Dan Hynes gained another dynamic Wednesday as Hynes officially announced his candidacy for governor with a proposal to raise the state income tax based on income.

Both political campaigns are staying true to their original slogans that we wrote about during the State Fair. Hynes says Quinn received his job by default after the legislature impeached former Gov. Rod Blagojevich and that Quinn has since failed to implement a consistent and calibrated agenda. Quinn, on the other hand, maintains that Hynes, as comptroller, has stood on the sidelines as a “shrinking violet.”

Before today, however, Hynes had not officially announced where he stood on an income tax increase other than saying the legislature and governor should look to cut spending first. On Wednesday, he announced, first in Chicago then in Springfield, a three-step plan that would rely on various cuts and efficiencies this fiscal year and propose a graduated income tax next fiscal year.

Because the state Constitution specifies Illinois’ income tax rate is a “flat” rate applied evenly to individuals, as well as a separate flat rate applied to businesses, changing the tax structure to a graduated rate would require a constitutional amendment. Hynes said he would want the General Assembly to approve a measure to put the question to voters about whether to change the Constitution in the November 2010 election.

The graduated rate, according to Hynes, would range from the current 3 percent on individuals to a new 7.5 percent, which Hynes said would only apply to individuals who make more than $1 million a year. He would not change the corporate rate. If instituted in January 2011, Hynes said the new tax would generate $5.5 billion to help close the budget deficit his second year in office.

Quinn, in his March budget proposal to the General Assembly, proposed raising the individual income tax rate from 3 percent to 4.5 percent and the corporate rate from 4.8 percent to 7.2 percent, but he would keep the rate “flat,” which would not require a constitutional amendment.

“Rather than taking years to enact through a constitutional amendment, it could have been done quickly through an act of the legislature,” said John Kupper, spokesman for the Taxpayers for Quinn campaign.

Quinn also wanted to triple the personal tax exemption, which he said in March would mean that about half of the state’s taxpayers would pay less, while the other half would pay more than they currently do.

Today, Hynes countered that Quinn would levy a 50 percent higher tax rate on all taxpayers, while his proposal would only increase taxes on those making more than $200,000 a year. “Because of the graduated income tax and the way it is designed, you’re actually going to pay more under Pat Quinn’s plan, even if you make a half a million dollars a year,” Hynes said in Springfield. “That is why his plan is not only inequitable and unfair, but really, wrongheaded and backwards.”

Both Quinn and Hynes use similar language — cut spending before seeking higher taxes — (we quoted Quinn as saying it in June, when budget negotiations hit a stalemate). Quinn cut $1 billion in spending already and said he is working toward another $1 billion as part of the final budget agreement for fiscal year 2010 (the current year).

But Hynes says Quinn’s approach to cutting is across-the-board and, therefore, unfair. Instead, one of Hynes’ cost-cutting proposals is to fire half of Blagojevich’s political employees or appointees making more than $70,000 a year. Hynes said his campaign identified 1,600 such employees through state payroll. Firing half of them, or 800 workers, would save $100 million a year, he said, but it would be up to the governor and his agency directors to determine which half to fire.

Other immediate cost-saving measures proposed by Hynes today include reducing discretionary grants, slashing contracts for advertising, consulting and other professional services and closing so-called tax loopholes by expanding the state sales tax to include such “luxury” services as Botox cosmetic injections, car and truck rentals and membership of private clubs. He’d also borrow $1.5 billion to pay down backlogged bills, which he said would leverage enhanced federal reimbursements temporarily available through the federal stimulus package.

Hynes said those would be the prelude to the second year, when he would then increase the income tax, merge the comptroller’s and treasurer’s offices and create two or three more gaming licenses to open new casinos, among other ideas. (See his proposals here.)

Several of his ideas — instituting a graduated income tax structure, building three new casinos, increasing the sales tax on cigarettes by $1, closing corporate tax breaks and prohibiting the state from rolling over unpaid bills into the next fiscal year — have been proposed within the past few years but have all stalled in the legislature.

In a phone interview shortly after the Springfield event, Hynes said legislators who opposed those ideas in the past might look at them in a different light under the current economic and fiscal circumstances. He added that his leadership style would differ. “I’d like to think that I have the ability to persuade lawmakers that this is the correct path. Part of that is leadership. Part of it is having a clear vision and being consistent, not wavering, not waffling and not changing your opinion, your position and your plan every week.”

Kupper of the Quinn campaign dismissed Hynes’ ideas as playing politics. “In a very real sense, this is a proposal that was put together for the benefit of a political campaign and not a serious effort to address the state’s fiscal problems,” he said. “It’s a lot of rehashed proposals that came right out of the political playbook 101. The question is better addressed to Dan Hynes as to how he is going to enact these things, since he’s pretty much been on the sidelines as these budget issues have been debated.”

September issue: Out with the Old — NCLB

Check out the September edition of Illinois Issues magazine.

Find a profile of Senate Minority Leader Christine Radogno, who has taken her party away from the legacy of James 'Pate' Philip, according to writer Kevin McDermott, in "Her own style."

In our cover story, educators and policy groups weigh in as Congress prepares to reauthorize the 2001 No Child Left Behind law. See "Out with the old."

And get a preview of an Illinois Supreme Court case that has potential to clarify what nonprofit hospitals need to do to qualify for property tax exemptions. Read "Charity care" before the case's oral arguments, scheduled for September 23.

In the print edition, only, University of Illinois at Springfield professor Christopher Mooney analyzes Gov. Pat Quinn's "populist" style as he calls attention to direct democracy concepts of recall and citizen initiative in "Let the people speak."

Also in print-only, MarySue Barrett, president of the Metropolitan Planning Council, pens a guest essay about "Wise spending," or a method she says would get infrastructure investment right.

As always, the print edition also includes, among other monthly features, the award-winning column by Charlie Wheeler, director of the Public Affairs Reporting program at UIS. This month, he says, "Illinois' budget is the most out-of-whack in recent history."

Reform do-over

By Bethany Jaeger

In an unusual move, the Illinois legislative leaders asked the governor to veto a bill that Democratic members sent to his desk in May. Gov. Pat Quinn obliged, saying he would work with members of both political parties, as well as government reform advocates, to start from scratch — and get it done by October 14 — to tighten up the rules for the funding of political campaigns.

Quinn vetoed House Bill 7, which would have established contributions limits of $5,000 for individuals, $10,000 for businesses and labor unions and $90,000 for transfers from statewide political parties. Quinn said since he received the bill, he’s gotten a lot of feedback from individuals, reform advocates and newspaper editorials that the bill was flawed and could have unintended consequences, as well as risked turning voters away from a system that maintains the status quo. In turn, Illinois remains one of only a handful of states with no limits on the amount individuals, businesses or interest groups can donate to political candidates.

“I’d rather take more time to get it right and have public consensus behind it than hastily do something that might have happened in the spring,” Quinn said during a news conference with all four legislative leaders. They were joined by reform advocates from Change Illinois, a coalition of about 50 organizations seeking campaign contribution limits, among other things.

George Ranney, president and chief executive officer of Chicago Metropolis 2020, as well as a co-chair of the reform group Change Illinois, said the governor and the legislative leaders agreeing to work out a compromise before the General Assembly returns for its annual fall veto session was a “major step in the right direction.” Next, he said, “even more so, at this point, we think there is an opportunity to do the right thing for this state, to enact a bill that has strong limits, that has the right kind of committee structure and, importantly, has a real set of provisions for enforcement.”

It was "not perfect"
Quinn’s veto comes after he testified in favor of HB 7 in late May. Sitting next to House Speaker Michael Madigan, the governor said then that the bill was not perfect, but it was a “significant step forward” and that it was the “best we can do at this time.”

His testimony contradicted the recommendations of his own Illinois Reform Commission, which wanted more stringent contribution limits and other enforcement reforms.

Quinn said today that he seriously considered altering the bill or adding to it, which would have sent it back to the legislature. But he said it dawned on him that it was better to totally veto it and make a stronger bill. He added that he would seek the commission’s input on a new version. “Sometimes when you have to alter your course to make things better, you do that. I’d rather make it better than to not do it right.”

Senate President John Cullerton said in Quinn’s defense that a new negotiated bill wasn’t ready by the time Quinn had to act on HB 7 (he faced a Friday deadline). “We asked the governor to veto this bill. We asked him — the sponsors of the bill — asked him to veto it. Because if he signed it, there are people here who think it could be much better, and that would be interpreted as accepting something that had flaws. We didn’t want to do that,” Cullerton said. “He’s not flip- flopping. He’s doing what we’ve asked.”

Cullerton added that the general areas they intend to work on include the level of contribution limits and the ability of officials to enforce the new rules.

Cynthia Canary, who previously described HB 7 as “phony reform,” today defended Quinn. “We often slam our elected officials for not having a backbone, for not listening to us, for flip-flopping. What could be braver than listening to the people coming to the table and saying, ‘We hear you. We’re going to try to do things differently.’”

Republicans, who argued they were cut out of the negotiating process, deemed the bill “seriously flawed” and urged the governor to reject it in totality and start over. Senate Minority Leader Christine Radogno today commended Quinn for “courage” in not signing HB 7 just to have something on the books. “As desperate as our state is for reform, and that includes campaign finance reform, there was tremendous pressure on the governor to go ahead and enact a bill that really would have maintained the status quo or even made it worse.”

During the spring legislative session, Radogno sponsored multiple versions of campaign finance limits. One version matched recommendations by the Illinois Reform Commission and Change Illinois. It would have established contribution limits similar to those set at the federal level: $2,400 for individuals, $5,000 for political committees, businesses and unions, and $30,000 for legislative leadership. Her new bill eventually will appear in Senate Bill 2464 (the link won't be available for a while).

House Republicans also supported a Democratic-sponsored bill, HB 24, that would have mirrored federal limits.

House Minority Leader Tom Cross said today that agreeing to start over on campaign finance was a good beginning, but there’s more on the agenda. He said Republicans also want to address the idea of moving back the primary election date (now held in early February), allowing voters to recall elected officials, instituting special elections to fill vacant seats and reforming the redistricting process.

House Bill 7, as approved
HB 7 as approved by the Illinois General Assembly would not have taken effect until January 2011, after the next general election.

One point of contention among reform groups and legislators is that the bill set a pseudo limit on statewide political party transfers. While the dollar amount of transfers would be limited, the Democratic Party of Illinois, for instance, could offer unlimited in-kind contributions. That could include anything from support for advertisements, yard signs, mailers to manpower to knock on doors.

Anther debated provision would create a new type of fund for legislators to pay for maintaining their offices and assisting people in their legislative districts. Contributions to those funds would be capped at $5,000. The money could not be used for campaigns. Critics said the new so-called “constituent services” funds could be used as a loophole for politicians to throw political events.

And contrary to the wishes of the governor’s reform commission, HB 7 as approved would have only required real-time disclosure during the month of May, when state budget negotiations tend to peak. Other than that, political campaigns would have to file financial reports four times a year. The Illinois Reform Commission wanted politicians to immediately report contributions throughout the entire year. They currently only have to file major disclosure reports twice a year. The bill does include a provision to allow the Illinois State Board of Elections to audit candidates and committees if they missed two consecutive reporting deadlines.

House and Senate Republicans issued the following list of “flaws,” in addition to the points made above:

• “Limits are based on an annual cycle, not election cycles” — Annual cycles could benefit incumbents who could raise money year-round, while challengers would struggle to gain name recognition and financial support.
• “Too many possibilities for candidate committees” — It could spur the creation of even more political finance committees because each official and candidate would be able to have up to three separate committees, all with different contribution limits. House Minority Leader Tom Cross said that would cause a “diffusion of contributions, not a limitation on them.”
• “No comprehensive enforcement mechanism” — The Illinois State Board of Elections would gain little power and financial support to enforce the new rules, although it would be able to audit campaigns if they missed two consecutive reporting deadlines.
• “Doesn’t take effect until 2011” — That’s after the next general elections, which House Speaker Michael Madigan has said would make it fairer because candidates who started fundraising under the old rules would have an advantage over those who started under the new ones.

Two UI trustees remain

By Bethany Jaeger
Two University of Illinois trustees who refuse to resign after the exposure of an admissions scandal will remain. Gov. Pat Quinn said today he wanted to avoid potentially lengthy litigation that would distract from the new board’s mission.

“Indeed, I feel that if we went down that road, that would become the main show, as opposed to what we really have to do,” Quinn said during a Chicago news conference. “Our main focus should be on repairing the damage that ‘s been caused to the university.”

The Chicago Tribune reported in early June that over five years, about 800 students received special treatment and were admitted to the University of Illinois at Urbana-Champaign because they were sponsored by such politically connected officials as former Gov. Rod Blagojevich, legislators and university donors and trustees.

Quinn sought the voluntary resignations of all nine appointed trustees, as recommended by a special panel led by former federal Judge Abner Mikva. Two board members resigned before the report came out. Five resigned after. Two did not step down. They are Democrats Carroll Frances and James Montgomery. Quinn said he met with Frances and Montgomery and reiterated his stance that they had a fiduciary responsibility and that “if something goes wrong on your watch, seriously wrong, then you should voluntarily file your resignation.”

However, he said, it’s their choice to serve the remainder of their terms. Frances’ term ends January 2011, while Montgomery’s term is supposed to end in 2013.

“I am not going to seek to remove them,” Quinn said. “I think the litigation that would ensue if I did that would totally distract us from our mission at hand, which is rebuilding the public confidence in the integrity of the University of Illinois. That would be a sideshow.

He later added, “I think it’s much better to just soldier on with good men and women that I appoint.”

As of today, Quinn has filled two vacancies and said he would fill the remaining five before the board’s next meeting September 10.

Today, he appointed Christopher Kennedy, president of Merchandise Mart Properties based in Chicago and son of the late U.S. Sen. Robert F. and Ethel Kennedy (as well as nephew of the late U.S. Sen. Ted Kennedy). Chris Kennedy’s name was floated as a possible U.S. Senate candidate to fill the seat vacated by President Barack Obama and was mentioned as a potential candidate for governor. He opted not to run in either race.

“He’s a person of great accomplishment,” Quinn said. “He understands business, and he definitely believes in social service. He believes in education.”

Quinn also appointed Lawrence Oliver II of Orland Park. He has been a chief legal counsel for the Boeing Company since 2004. Previously, he was a private attorney and an assistant U.S. state’s attorney in Chicago, as well as a member of Quinn’s Illinois Reform Commission and a vice chairman of the state’s Executive Ethics Commission.

“He is a person who understands the law, and he definitely understands ethics,” Quinn said.

They replace Democrat Niranjan Shah, whose term was set to expire in 2015, and Lawrence Eppley, who lists his political affiliation as "independent" and whose term was to expire in 2013.

Of the 10 voting members, no more than five can be from the same political party. The trustees are charged with governing the University of Illinois, including all three branches in Chicago, Urbana-Champaign and Springfield.

Quinn, who is an ex officio member, said it’s up to the new trustees to decide how to reform the admissions process and whether to take action against the high-level administrators who were involved in the so-called Category I scandal.

Senate President John Cullerton is still encouraging the remaining trustees to step down, according to Rikeesha Phelon, his spokeswoman. “Since that is not likely to happen, he is reminding them that if Senate Bill 1333 passes the Senate, it will have the effect of removing the remaining trustees by law.”

The legislation was advanced as a way to force Quinn to “fumigate” state government from up to 750 employees or appointees put in place by then-Gov. Rod Blagojevich. The measure stalled during the spring legislative session. Cullerton is expected to call that legislation for a vote when the General Assembly convenes for its fall “veto” session in October.

Comptroller Dan Hynes, who is a Democratic opponent against Quinn in the February primary election, sent a statement through his campaign that said Quinn mishandled the situation from the beginning. “Yesterday, Gov. Quinn said he would act on the University of Illinois trustees issue with ‘certainty and with dispatch.’ Today he did neither. Unfortunately there is little that is certain about the ultimate resolution of a scandal first revealed last May, and acting with dispatch would have resolved this matter well before the students returned to class.”

Hynes did not say whether he would have forced the resignation of the remaining two trustees. A call to his campaign was not immediately returned. UPDATED: I just missed the Hynes' campaign returning my call last night. Spokesman Matt McGrath said that Hynes' criticism is not about the handling of individual board members, but it is about how Quinn handled the case from the beginning without immediately determining his legal powers to clear the board or not. He said Hynes would have been more immediate in determining those legal powers and would have set a deadline and established a clear plan to meet that deadline.

Ann Lousin, a John Marshall Law School professor who helped draft the 1970 state Constitution and who is a former chair of the Illinois State Civil Service Commission, points to the constitutional provision spelling out the governor’s ability to remove appointees. It states that the governor can remove an appointee for “incompetence, neglect of duty, or malfeasance in office.”

She said that provision — while arguable both ways — would not apply to gubernatorial appointees of the University of Illinois board of trustees. “Because then that would make the University of Illinois nothing more than a state agency under control of the governor and required to do his bidding.”

“If you want an independent board on the University of Illinois,” she added, “you do not allow the governor to get rid of them when they don’t part their hair right.”

Home services grant to be cut October 1

By Bethany Jaeger
A short-term borrowing plan approved by the General Assembly to prevent drastic cuts to human services might not be enough to prevent layoffs of workers who advocate for people with disabilities throughout the state.

A network of about two-dozen Centers for Independent Living were told earlier this month that starting October 1, a state grant that pays for recruiting and training personal assistants for individuals with severe disabilities would be cut. The so-called Home Services grant is funded through the Illinois Department of Human Services. It also pays for training of the people with the disabilities so they understand their civil rights when working with caseworkers and so they learn ways to manage their personal assistants.

The 23 Centers for Independent Living that operate throughout the state run on shoestring budgets, said Ann Ford, executive director of the Illinois Network of Centers for Independent Living based in Springfield. They already anticipated a 10 percent reduction in funding as part of the fiscal year 2010 budget agreement, which is expected to result in furlough days and potential layoffs. Cutting the Home Services grant on top of that would affect between 2,500 and 3,000 individuals who are served under the program each year, according to Ford.

For Mark Karner, director of advocacy for Progress Center for Independent Living in Forest Park, that means he’s out of a job Thursday. Karner also has multiple disabilities and needs a machine to help him breathe and a home aide to help him get out of bed each morning, among other daily functions. He expects to be on a job hunt, or, if he couldn’t find a flexible employer, then he would have to file for unemployment or Social Security, which he has not had since before he started working at Progress Center 16 years ago.

Tom Green, spokesman for the Department of Human Services, said it all comes down to the budget. “It’s the toughest financial challenge that Illinois has ever had. Everyone has to make sacrifices. There’s a limited amount of revenue in the budget that was passed by the General Assembly, not enough to cover all the expenses. And DHS has made cuts in all budget areas.”

He added that cuts to community-based services would have been far deeper, as much as 50 percent, without a $3.4 billion borrowing plan approved by the General Assembly in July. About $2.2 billion of that was slated for community-based human services. But that same budget agreement also relies on Quinn reducing another $1 billion in spending. The General Assembly gave Quinn unprecedented discretion in where to cut.

Ford said she was “very disappointed” in that budget agreement.

“We continue to borrow. We don’t really act like adults and look at what do we need to do to have enough revenue in this state to support the programs that allow some people some dignity in their lives,” she said. “It’s a huge disappointment to me that that was the option that was chosen, and it’s a bigger disappointment to me that the General Assembly then went home and said to the governor, ‘Do whatever you want to do.’”

On July 31, Quinn said that he would spread the cuts out in a way that would maximize federal matching and stimulus funds. And he said he would fund health-related initiatives that focus on disease prevention and that reduce demand for more expensive services later.

Karner said zeroing out the Human Services grant would do the opposite. Mike Ervin, for instance, needs the personal assistants. But he’s lived in his own condominium in Chicago as a freelance writer, a playwright and a community activist, and he’s not enrolled in Medicaid. Losing the personal assistants grant program, Ervin said, would take the system back 30 years. “Not only does it keep me out of nursing homes, but I employ five people. And it keeps us paying whatever taxes we do. It’s just positive all the way around. It’s the wave of the future, it’s the way the future should be going. And cutting it just such a huge regression.”

Karner said a meeting for consumers affected by the Home Services grant is scheduled in Chicago Friday. “I guess there’s still some glimmer of hope that the governor will change his mind before October 1,” he said.

Rallies against the cuts also are scheduled next Monday in Springfield and Chicago. Ford said if the centers don’t know by mid-September whether the grant will be restored, more layoffs are expected.

Republican transition

By Bethany Jaeger
As a handful of Republicans toss their hats into the ring for Illinois governor, their party’s ringleader of sorts surprised top GOP officials by stepping down Thursday during a meeting in Springfield.

Andy McKenna, chairman of the Illinois Republican Party since 2005, told state central committee members he was resigning to allow the party to transition before the February 2 primary elections, rather than waiting until his term was supposed to end. “I don’t to want distract you [during] the general election race,” he said.


The State Central Committee elected Pat Brady, a national committeeman, to fill out the rest of McKenna’s term. Members will elect a new chairperson after the primary election.

Countering some speculation, McKenna did not announce a bid for another race. He previously expressed interest in a bid for the U.S. Senate seat formerly held by President Barack Obama. His actions sparked controversy within the party, as Republican U.S. Rep. Mark Kirk, a five-term representative from Hinsdale, has announced in that race and is considered the front runner in the four-way contest.

McKenna instead told state central committee members that he would focus on building resources and getting involved in primary contests as chair of a “victory fund,” which he created to support Illinois’ GOP candidates.

The timing of McKenna’s resignation surprised party leaders, but Senate Minority Leader Christine Radogno said: “There’s been speculation for a while that a change might be coming. I don’t think anyone knew it was going to happen today or in this particular venue.”

She added, however, that the timing did help to avoid a distraction leading up to November 2010. “I think that it’s important that we get this chapter closed and settled and we have a new person at the helm the minute the primary’s over so that we can focus on the Democrats and not on the internal politics.”

Governor’s Day highlights 2010 primary

By Bethany Jaeger
Democrats got a preview Wednesday of what to expect leading up to the February 2 primary election: a partial-term governor who says an income tax increase is necessary to maintain essential state services versus a state comptroller who says citizens shouldn’t have a governor by default. They should have a choice.

Comptroller Dan Hynes stood a few feet away from Gov. Pat Quinn this morning when he said Illinois needs a governor who leads with “no sugarcoating, no short-cuts, no excuses.”

“We need a governor who can provide strong and steady leadership for smart budget policies that will put us on solid financial ground, and we will need a leader who will offer a clear, consistent and compelling vision for our future,” Hynes said. “That’s what this election is about.”

He spoke to a packed banquet hall during an annual breakfast of the Illinois Democratic County Chairmen’s Association in Springfield. Many Illinois elected officials typically attend the event before the annual State Fair rally day for Democrats.

Hynes continued to say that the Democratic Party has been through too much to take the path of least resistance. “The people of Illinois have been through too much to avoid asking tough questions and facing a public debate about which vision our party will embrace. I respect Pat Quinn. I find him to be a decent man, but this nomination must be earned, not bequeathed or signed or transferred. It must be earned.”

A few moments later, Quinn in his speech countered that on March 18, he proposed a budget that would raise the state income tax as a way to balance a severely out-of-whack budget and help recover from the aftermath of a nationwide recession. “Talk about courage. Talk about not sugarcoating our budget deficit. We have to tell the truth to the people of Illinois.”

Throughout his speech, Quinn thanked all statewide officers except Hynes. He even thanked local politicians, including Cook County Sheriff Tom Dart. The governor later said he would defend his record against Hynes’ statements, particularly since the comptroller has not endorsed the idea of an income tax increase. “He can stand on the sidelines and throw bricks at the guy in the middle of the arena, but I think part of the job of governor is not to be a shrinking violet, to take positions and to defend those positions and tell the people what they need to know,” Quinn said.

Hynes chose not to attend a Democratic rally at the State Fairgrounds later in the day because, he said, Quinn deserved to host of the annual Governor’s Day, a State Fair tradition. I ran into Hynes after the rally, when he said his budget plan would start with spending cuts, then find new revenues. "We have to eliminate wasteful spending and show the people that we’re doing everything we can to sacrifice and streamline before we ask them to pay more. And that hasn’t yet happened. Gov. Quinn has really been unwilling to do those tough things.”

As part of the budget agreement with the state legislature, Quinn already has cut $1 billion in spending and is charged with reducing another $1 billion before the end of the fiscal year. Among many other spending decreases, Quinn seeks furlough days and layoffs for state employees. But some of those plans require negotiations with public employee unions, who strongly oppose both ideas and instead say an income tax increase is necessary.

Governor’s Day at the State Fair
The Democratic rally completely differed from the past six years. The absence of former Gov. Rod Blagojevich, as well as busloads of union supporters that Blagojevich’s campaign brought in, made a difference. For the first time, the House speaker, the Senate president and the governor sat next to each other. Even Attorney General Lisa Madigan joined the rally, which she has not attended in a few years.

There was little drama, other than jokes made about six of at least eight candidates for lieutenant governor sitting on the stage together and addressing the crowd one by one.

Democratic leaders acknowledged that their political party faces many challenges, particularly the ethical lapses and fiscal woes exposed within the last year, but they tried to frame Blagojevich’s impeachment as a result of their proactive steps.

“As we face a challenge of ethics and integrity, it was the Democrats in the Illinois House of Representatives that initiated the impeachment proceeding against their own Democratic governor,” said House Speaker Michael Madigan. “We’re not happy with what happened, but when the time came, we were more than capable to make a decision that one of our own had done wrong and must be removed from office.”

Republicans will try not to let them get away with that, however. Senate Minority Leader Christine Radogno, whom I stood next to in the Statehouse basement during a tornado warning, countered the Democratic message. “They can try as hard as they want, but the people of this state are smarter than that. And the fact of the matter is, people need to remember, the Democrat legislature enabled Blagojevich from Day 1. So it’s difficult for them just to walk away now.” Madigan also co-chaired Blagojevich’s reelection campaign, she added.

Republicans will have their rally day at the State Fair on Thursday.

Revamped employee ethics rules enacted

By Bethany Jaeger
In a “week of reform,” Gov. Pat Quinn today signed Senate Bill 54, which addresses state employee ethics rules and lobbyist registration requirements. The governor enacted a revamped Freedom of Information Act yesterday.

Here’s the breakdown of SB 54 and some background, including why provisions to strengthen the role of inspectors general were needed (it relates to when former Gov. Rod Blagojevich formed the inspectors general but did not give them the ability to shine a light on ethics violations).

Employee ethics:

• Reports written by inspectors general will be made public record if the inspectors find wrongdoing and either suspend or terminate a state employee. Some information could still be blacked out, or redacted, if its release would harm an ongoing investigation.
• However, routine reports about the status of investigations will not be subject to requests under the Freedom of Information Act.
• Inspectors will be able to open investigations based on anonymous tips.
• The law clarifies the process for investigating potential ethics violations.
• The Executive Ethics Commission will house new procurement officers to oversee the way state agencies buy goods and services.
• Employees and candidates cannot promise compensated time off, benefits, raises, job promotions, favorable regulatory treatment or a state contract in exchange for a campaign contribution.
• State employees have to take an online ethics exam within 30 days of starting their new jobs, rather than within six months, as currently required.

Updated revolving door ban:

• Policymakers will not be able to resign and within a year accept a position with private companies that received significant state contracts from the agencies where the officials worked.
• The state is expected to have an easier time tracking which employees will be subject to the revolving door ban because the legislation also requires agencies and executive offices to list those employees. Those lists will be filed with the agencies' respective ethics commissions.

New lobbying rules:

• People who lobby state boards, commissions or retirement boards now will have to register as lobbyists.
• All lobbyists will have to abide by stricter disclosure requirements, including listing all expenditures related to lobbying activities, their clients and the subject matter of lobbying activities. The reports will have to be filed with the secretary of state on a weekly basis when the legislature is in session and monthly during the off-season.
• Many will have to pay a higher $1,000 fee, which is the way the state is expected to pay for more inspectors to monitor lobbying activities. House Speaker Michael Madigan previously said he would consider lowering the fee for smaller nonprofit groups in the future.

Quinn: "This will be a week of reform"

By Bethany Jaeger
The end of August marks a deadline for Gov. Pat Quinn, who has to act on legislation approved by the General Assembly before bills automatically become law. In Chicago today, Quinn deemed this week as a “week of reform,” starting with today’s enactment of the revamped laws to ensure public access to information. He could soon act on ethics legislation to limit the amount individuals and political organizations could donate to candidates.

Freedom of Information Act = Senate Bill 189
Quinn signed SB 189, which rewrites the Freedom of Information Act (background here). Starting in January 2010, the process of requesting public information is supposed to get faster and more accountable.

In addition to new training requirements and higher standards for denying access to information, the new FOIA will require public bodies to reply to requests for information within five business days, as opposed to the current seven days. And if a public body denies a request, individuals will have to take fewer steps and less time to appeal that denial.

“The main thing this new act does is enforce many of the good words that were already part of Illinois law that were ignored by public officials,” said Hanke Gratteau, a member of Quinn’s Illinois Reform Commission and former investigative reporter and managing editor for the Chicago Tribune. “There is now recourse if that is avoided, and that’s why it’s good enough for me.”

Local and state governments still can deny access to information under a series of exemptions, and the legislature still can withhold internal documents such as staff analyses and final reports drafted by consultants.

But there are new penalties, something absent from the current FOIA. Under the new version, if a court finds that a public official intentionally violated the FOIA or Open Meetings Act, the official could be fined between $2,400 and $5,000 for each offense.

The new law also gives new powers to the Illinois attorney general's office, where members of the public, media or government can seek help from a specialized lawyer to settle disputes about whether information should be released. The so-called public access counselor will have new authority to issue binding opinions and to subpoena information.

“Today, we can say that Illinois will officially make it out of the Stone Age of transparency,” Attorney General Lisa Madigan said. “We will end the culture of secrecy that surrounds our government, and we will have, I think, a better relationship and better trust with members of the public.”

The Illinois Municipal League, however, believes the new FOIA will place a heavy burden on local governments and won’t go as smoothly as lawmakers think in the next four and a half months, said Roger Huebner, the organization’s deputy executive director and general counsel. Every governmental body covered by the FOIA now has had its primary function fundamentally redefined to field information requests, regardless of whether their budgets have been slashed, he added. More background on the Municipal League’s statements are online.

Cara Smith, deputy chief of staff of policy and communications for the attorney general's office, said she disagrees and that the new law could lessen the burden on local governments because they will have a built-in resource with access to a public access counselor, as opposed to an outside legal counsel.

Heubner referred to commercial requests, in particular, as problematic because they tend to be broad, time-consuming requests. “That’s going to become a financial nightmare.” Local governments still can reject requests by deeming them unduly burdensome.

Heubner also said the new FOIA isn’t written for lay people and that information requests immediately will become legal matters if disputed. “This bill has gone from the hope to help the laymen to the lawyer’s dream.”

Smith said: "If the public body has denied a request and the citizen comes to us for help, then the public body will have to decide if they want to interact with us informally or if they have to get a lawyer. It's certainly not necessary." She added, "I recognize that the public bodies have not looked at this as a benefit to them, but I think that over time, they will see it as just that."

Quinn’s enactment of the new FOIA comes after the governor came under media scrutiny for reportedly using his personal cell phone rather than using a state-provided phone that is subject to public access laws. Quinn said in Chicago today that taxpayers do not pay for his private cell phone and that he doesn’t use it for official state business.

“I do not use this phone to make e-mails to government employees or conduct any kind of communication with government employees,” he said. “As the person of the attorney general’s office who oversees this law [determined], private phone calls that don’t come out of public funds are not subject to the Freedom of Information Act.”

Transparency = House Bill 35
The state also launched a new Web site where anyone with Internet access can look up state employee salaries, state contacts and state-issued licenses. It’s called the Illinois Transparency and Accountability Portal.

Individuals also can look up all board and commission members, as well as their terms and whether they get paid at a new site dedicated to executive appointments. It was created under Senate Bill 1602, which also establishes new ethics requirements for board and commission members.

Campaign finance reform = House Bill 7
Quinn indicated he also could act as soon as tomorrow on legislation that would limit the amount individuals and political organizations could donate to political campaigns. HB 7 won legislative approval but was not the version recommended by the governor’s own Illinois Reform Commission. (Background here.)

Quinn could use his amendatory veto power to change the legislation, although he said he uses that power judiciously. “I’m going to use that only where it’s needed and where it can advance the common good. I think that’s the way we have to do it. We don’t do it to kick the legislature in the shins. I don’t believe in that.”

Patty Schuh, spokeswoman for the Senate Republicans, said Minority Leader Christine Radogno asked the governor to veto the bill in its entirety "because it’s been called worse than nothing. We believe there is ample opportunity to revisit this if everyone is committed to change,” Schuh said.

Overtime costs corrections

By Bethany Jaeger
Gov. Pat Quinn plans to lay off as many as 1,000 prison workers at the same time a lengthy state audit reveals that overtime costs within the Illinois Department of Corrections increased from $19.2 million to $37 million two years ago because of staffing shortages.

The review by Illinois Auditor General Bill Holland’s office only pertains to fiscal years 2007 and 2008, when the corrections department was managed by a former director and under the administration of a former governor. Former director Roger Walker was appointed by then-Gov. Rod Blagojevich. Walker was replaced in June by Gov. Pat Quinn’s appointee, Michael Randle.

Holland said the deficiencies, including everything from spending more than authorized by the General Assembly to failing to spend money earmarked for hiring new frontline staff, does not paint a “pretty picture.”

“This goes to the heart of the failure of the management of the department,” he said, adding that because there have not been dramatic changes in the management since the two years in the audit, the foundation going forward is weak. “I think the new director has got some real soul searching to do with his management team.”

One problem cited in the audit was that the department violated the legislature’s intent by not spending extra money dedicated to hire new frontline staff. The General Assembly authorized spending $11.7 million to hire 231 new staff in fiscal year 2007, but only 154 new staff were hired. The next year, the legislature allotted $12 million to hire 500 new employees, but only six were reported as being hired. Instead, according to the audit, the department used the money to pay for existing staff, which also included more expensive overtime costs.

At the same time, the department reported that it lost 324 employees in fiscal year 2007 and 455 employees in fiscal year ’08.

The audit also states that mandatory overtime costs from inadequate staffing levels cost more money — overtime costs increased from $19.2 million in FY07 to more than $37 million the following year. The audit identified 126 employees working at various correctional centers that had worked so many extra hours during FY08 that they earned more $100,000, when their normal salary rates ranged from $40,000 to $75,000 a year. At Stateville Correctional Center, alone, overtime costs topped $13.7 million in FY08.

Anders Lindall, spokesman for the American Federation of State, County and Municipal Employees, which represents many prison workers, said the most recent tab for understaffing at all Illinois prisons was more than $60 million in fiscal year 2009, which just ended June 30. “That’s a five-fold increase over just a few years ago,” he said.

“On its face it may seem counter intuitive,” Lindall added, “but it’s simple math that hiring new staff at the lowest end of the salary scale and paying them straight time is far cheaper than paying time and a half to more senior employees.”

According to the audit, the Blagojevich administration ordered the department not to hire new front line staff in fiscal year ’08.

“There were clearly directions from the Blagojevich administration that certainly did not help the day-to-day operations of the department,” Holland said. However, he added, 19 of the findings were repeated from the last two-year audit. And 28 new findings were added.

“These were not immaterial findings,” Holland continued. “These were findings of great significance that related from the top to the bottom of financial management of the Department of Corrections. And clearly it demonstrated that there was a failure on the part of the management of the Illinois Department of Corrections.”

Januari Smith, spokeswoman for the corrections department, said in an e-mail that the department already is looking to reduce overtime costs while also preparing for potential layoffs planned by Quinn. “A cadet class graduated from the academy last week and will be on the job soon. As well, another cadet class will begin in mid-August. Those staff affected by layoffs may be eligible for vacancies at other facilities across the state.”

Smith added that other corrective action is challenged by current budget constraints. “IDOC has limited resources and is working with antiquated systems. It’s a challenge to keep up with increasing requirements and a decreasing staff.”

UI admissions panel: The leadership failed

By Maureen Foertsch McKinney

A separate office of the inspector general should be established for CORRECTIONthe state's universities, Gov. Pat Quinn’s Admission Review Commission recommended Thursday. (We had it as the U of I only. So sorry for the mistake) As expected, the commission also recommended that Quinn seek the resignations of the entire board of trustees.

The new inspector general would act as an ombudsman and would review problems with the law or the university’s own policies.

Regarding resignations, Commission Chairman Abner Mikva, a former federal judge, said earlier this week: “Obviously, [the governor is] free to accept those he wants and reappoint or refuse the resignations of those he thinks are doing a good job or can continue to do a good job. It is clear, as an institution, the board of trustees has not been governing in a way that the university needs or [that it] has the kind of governance it should have.”

Both the chairman and immediate past chairman of the board of trustees — Niranjan Shah and Lawrence Eppley — resigned within the past 10 days as the commission wound down its deliberations.

The Chicago Tribune reported in early June that over five years, about 800 students were admitted to the University of Illinois at Urbana-Champaign after receiving special treatment because they had obtained recommendations from clout wielders such as former board of trustees chairmen, former Gov. Rod Blagojevich, legislators and university donors. The Tribune reported that the names of those students, including some applying for admission to the law school, were marked in red on so-called “Category I” lists and received special consideration.

Other recommendations the panel agreed to send to Quinn include:

• A firewall be placed around the admissions process so that no one except a designated individual in the admissions office be allowed to influence admissions decisions.
• Only a high school guidance counselor, individual student or parent should be allowed to check on the status of an admission.
• The university should have a clearly stated policy on what information — such as testing scores, grade point average or class standing — would be used for consideration of admission.
• The university should establish a clearly stated, transparent process for appeal of admission decisions.

Quinn’s panel interviewed more than 30 people over a six-week period.