Friday, September 28, 2012

Study: Public research universities increased tuition while reducing per-student spending

By Jamey Dunn

Yet another study warning about state cuts to public universities came out this week, and Illinois was in the top 10 list of the worst offenders.

The National Science Board, which oversees the National Science Foundation and advises the federal government, published a study this week that focused on funding at the country’s 101 major public research universities. Between 2002 and 2010, per-pupil spending declined by an average of 20 percent nationwide. Illinois’ spending declined by 37 percent, which was the fourth largest decline in per- student spending. Colorado topped the list with a 48 percent decline in per-student spending. Only seven states did not decrease per pupil spending over the same time period.

In Illinois, state funding reductions and tuition increases have been the norm for higher education in recent years. Public research universities — including the state’s three schools, University of Illinois campuses in Urbana and Chicago and Southern Illinois University Carbondale — took an $80 million hit in the current fiscal year budget. U of I, the state’s largest university system, saw the biggest cut. The university system, which also included the University of Illinois at Springfield, sustained a $42.5 million reduction in state funding. Spending on day-to-day operations increased by 3.7 percent under the U of I’s current budget, but the state’s share of the spending went down.

Illinois has also been slow to make payments to schools. According the SIU President Glenn Poshard, The state still owes SIU, which also has a campus in Edwardsville, $54 million from the fiscal year that ended in June. Poshard said that the state is already behind on its payment for the current fiscal year as well.

Students who started at SIUC and the U of I this fall saw a 4.8 percent tuition increase. State law requires that tuition be fixed over four years for incoming freshman. U of I officials say the increase is comparable to 1.9 percent annual increase over four years, and that they plan to keep tuition increases tied to inflation to avoid big jumps. In 2011, before that policy announcement, tuition jumped by 6.9 percent.

The Science Board study found the trend in tuition increases repeated across the country. Over the last decade, students have been asked to pay more while universities in turn spent less per student. “In recent years, public research universities have raised tuition and fees at rates that have exceeded inflation and rates of increase at private universities, in part due to declining state appropriations.” Between in 1999 and 2009, tuition revenue from full-time students at public research schools increased by 50 percent.

John Koropchak, vice chancellor for research at SIUC, is not surprised by the results of the study. “Accounting for inflation, state support in the state of Illinois has dropped by about 27 percent in the last decade," he said. “Pretty much nationwide, state universities have seen a dramatic drop in support for public higher education.” He said other recent reports on funding for research schools have had similar results.

The Science Board report warns that if public schools lose their competiveness when it comes to recruiting, faculty and staff and fighting it out for research grants and contracts, it could have a negative impact on their surrounding communities. “Reductions in revenue of public research universities and gaps in salary between public and private research universities have the potential to lead to an outflow of talent at public research universities and reduced research capacity. These could result in greater concentration of talent and [research and development] in fewer geographical locations, and at fewer universities, with smaller and less diverse student bodies. This could have a substantial impact on economic and workforce development at the local, state, and national levels.” The prediction is especially alarming for a school like SIUC, which a major employer and economic driver in the region. “For the most part for the southern half of the state, there’s only one research university, and that’s us. That’s SIU,” Koropchak said.

He added, “There is some indication that there is a tendency right now for the private universities to be, in a sense, cherry picking the best faculty away from the public universities.” Koropchak said when institutions lose faculty it hurts also student recruitment because many graduate students are recruited by specific faculty members.

Koropchak said that research universities are also concerned about cuts on the federal level. He said that about $80 million of SIUC’s external budget comes on the form of government grants and contracts with industry, and some of that money is in danger. “These federal programs are projected to have something like 10 percent reductions in their budgets.” He said SIUC, along with most other research universities, is pushing for more collaboration with private industry in the form of research contracts. While such funding has increased in recent years, he said that the public perception that the private sector is filling the gap left by government cuts might be overblown. “It is still a pretty small fraction of most research universities’ portfolios.”

While many university officials in Illinois seem resigned to the fact that state higher education spending will probably not see a significant increase in the short term, Koropchak said there are things that can be done at the state level to increase the competitiveness of Illinois’ research universities. He suggests a statewide council with representatives from the research arms of the three schools. Such a group could help schools collaborate on research projects bringing together multiple niche experts to tackle a larger project, such as water conservation. He said that an open channel to joint research would allow the three schools to bring perspectives from different geographic locations of the state to address a statewide issue, or allot for fresh eyes on a regional problem.

 Koropchak believes the idea would help all three schools become more competitive when seeking federal grants and contracts. He points to similar entities in states like Ohio and Pennsylvania. “I think the more collaboration we have between the different research universities, the better we are going to take advantage of the assets that we have.”

Wednesday, September 26, 2012

Poll: Voters say Illinois is corrupt and headed in the wrong direction

By Jamey Dunn

According to a new poll, the majority of registered voters in Illinois are unhappy with the direction the state is going, and most surveyed said Illinois is more corrupt than other states.

Respondents to the Paul Simon Public Policy Institute’s annual poll had a rather low opinion of the state. Almost 70 percent said that they thought the state was headed “in the wrong direction,” and 58 percent said that Illinois is more corrupt than other states. More than 75 percent of respondents said that corruption is widespread in the state. Illinois voters also pointed the finger at business. About 62 percent said that they believed that corruption is widespread in Illinois business. Between September 4 and September 10, 1,261 registered voters across the state were surveyed for the institute’s poll. The margin of error for the survey is plus or minus 2.77 percentage points.

Charles Leonard, a visiting professor with the Paul Simon Public Policy Institute, said the negative views of the state’s institution are damaging not only to government but also to the private sector. “That just can’t be good for policy or the economy.” More respondents said that Illinois was on a negative trajectory than said that the country was on the wrong path. Still, almost half of respondents said they thought the country is headed in the wrong direction. Leonard said this response is not typical. He said that often in polls, respondents say that their home state is doing at least a little better than the country as a whole.

Illinois has not fared well in any of the institute’s recent polls. Since 2008, fewer than one in five voters said that the state was heading in the right direction.

People were more positive about their own towns or areas of the state. About 54 percent of respondents said that things were headed in the right direction in their city or area of the state. More than 80 percent of respondents rated their own quality of life as average or better, and nearly half said that their quality of life was “good” or “excellent.”

While social issues have become political lightning rods during the presidential campaign, this poll indicates that Illinois voters lean to the left. The majority of respondents favor some form of legal recognition for same-sex couples, and 43.6 percent supported same-sex marriage. The last time the institute asked the question was in 2010, when 33.6 percent of respondents said they backed same-sex marriage. In the poll released today, about 20 percent said they opposed any legal recognition for same sex relationships. More than 80 percent said abortions should be legal either under all circumstances or under some circumstances, and almost 16 percent said it should be illegal under all circumstances.

Respondents favored several ethics measures. Almost eight in 10 favored term limits for lawmakers. About 78 percent favored limiting the amount of time a lawmaker can serve in leadership roles, such as speaker of the House and president of the Senate. More than 60 percent supported limits on the amount of campaign cash that party leaders can give to candidates.

More than half of respondents said they were “strongly opposed” the U.S. Supreme Court’s Citizens United decision, which opened to door for so-called Super PACs to spend unlimited funds anonymously. However, most respondents were skeptical about the ability of campaign contribution limits to curb corruption and agreed that “money always finds a way to influence politics.” They instead favored the “complete immediate disclosure of all contributions.”

Those surveyed supported more personal disclosure from candidates as well. The majority said it was “very important to know” whether a candidate for the General Assembly is a lobbyist or is related to a lobbyist, is part of an organization that receives funds from the state or has business interests that could benefit from public policy decisions. Almost 70 percent backed a one-year waiting period for former lawmakers before they could become lobbyists.

Leonard said that more drastic ethics measures, such as term limits are unlikely. “It’s probably not realistic that the leaderships would allow the legislature to impose these on itself.” However, he said more disclosure of elected officials' personal finances and businesses interests could go a long way toward repairing the state’s reputation. “It’s my contention that some of these ethical reforms, the legislature could impose on itself relatively painlessly.”

He asked: “Why not say: ‘Hey we heard you. We’re honest. These things won’t hurt us. We aren’t scared.’?”

Monday, September 24, 2012

New statistics show poverty continues to grow in Illinois

By Jamey Dunn

New data from the U.S. Census Bureau shows that poverty continued to grow in Illinois in 2011.

According to estimates from the census bureau’s American Community Survey, about 1.9 million Illinoisans were living in poverty in 2011. That compares with about 1.7 million living below the poverty line in 2010. Last year, the census bureau considered a family of three with a household income of $17,916 or less to be living in poverty; in 2010 it was $17,374 for three people. In 2011, 15 percent of Illinois residents were living in poverty, which is a jump from 13.8 percent in 2010. The numbers from the census bureau are the most current comprehensive statistics available on poverty. For more on 2010 poverty numbers, see this Illinois Issues Blog post. 

According to the bureau's findings, the median household income in the state has been slipping during the last three years for which figures are available. In 2011, it was $53,234, down from $58,743 in 2008.

Nationally, the poverty rate held relatively steady. It was 15.3 percent in 2010 and increased slightly to 15.9 percent in 2011. About 48.5 million Americans were living in poverty last year.

Of those living in poverty in Illinois last year, 648,592 were children. In 2011, the child poverty rate was 21 percent. That was a significant jump from 2010, when 590,949 children were living in poverty and the rate was 19.4 percent. One out of four children under the age of 5 was living in poverty last year.

“These near-unprecedented poverty levels are not simply the result of the recession and a sluggish recovery. Poverty was on the rise before the recession began as broader shifts in wages, job quality, workforce preparation, inequality and harmful cuts to the safety net disproportionately impacted people at the lower end of the income spectrum,” Amy Rynell, director of the Social IMPACT Research Center at the Heartland Alliance, said of the new poverty stats.

The Illinois Commission on the Elimination of Poverty, which includes members of the Heartland Alliance, set the goal of cutting extreme poverty in half by 2015, but the new statistics show that the state is losing ground. Extreme poverty is defined as an income that is less than half of the federal poverty level. Almost 100,000 more Illinoisans were living in extreme poverty in 2011 than in 2010. Nationwide, 21.4 million people lived in extreme poverty in 2011.The commission suggests that the state tackle extreme poverty through a series of policy changes, including increasing housing subsidies, increasing the number of families who receive welfare support and increasing access to community college scholarships.

Wednesday, September 12, 2012

State council considers required insurance benefits

By Jamey Dunn 

Illinois officials are weighing choices that could determine the future of the insurance market in the state for the near future.

As part of the Affordable Care and Patient Protection Act, Gov. Pat Quinn’s Health Care Reform Implementation Council is working to determine a benchmark for benefits that insurance companies must offer to individuals and small businesses in Illinois. “The benchmark will have an impact on insurance that’s sold both on and off the [online insurance] exchange,” Coleen Burns, special council for health policy for the Illinois Department of Insurance, said at a meeting of the council today.

The council will recommend one plan that will set the standard for benefits offered in 10 service categories, such as prescription drugs, maternity care and laboratory services. These basic required offerings are known as essential health benefits.

The council can choose between several existing plans, such as the three largest state employee health plans or the three largest group plans in the state. Once the council picks one plan to use as a model, other insurers must offer benefits under the 10 categories that are equal to the value of benefits offered in the plan. Illinois must pick a plan as is and cannot add on or subtract benefits. The standards set by the council will kick in in 2014 and last until 2016, when the federal government plans to reassess the required essential benefits.

 Burns said the choice will set a floor for required benefits, but insurance companies can offer more generous plans. “A[n insurance] carrier is at liberty to sell a bronze plan, a silver plan and a platinum plan, but all three plans must meet the benchmark.”

The council is taking public comment and suggestions through September 19, and Quinn must make a recommendation to the federal government by September 30. If the state does not choose a benchmark plan, the feds will choose one for it.

Council members have to weigh several areas of interest when considering what essential benefit requirement to recommend. Members of the committee said they hope to ensure that there are strong benefit levels for mental health and substance abuse treatment, which are two areas they say are often inadequately covered by insurance. “It truly signals that there is greater acceptance and understanding that the treatment of mental health disorders and substance abuse must be a priority,” said Lorrie Rickman Jones, director of the Department of Human Services' Division of Mental Health.

Russell Welcherd from Quincy asked that the council pay close attention to the benefits related to treating chronic disease. Welcherd has a genetic disorder that causes emphysema. He receives weekly treatments for his illness. “If a health insurance policy that discourages the proper treatment is imposed, people like me will ultimately suffer.” Welcherd said that without his treatment he would have to make frequent emergency room visits and be placed on oxygen therapy.

Larry Barry, president of the Illinois life Insurance Council, warned Quinn's council members that requiring plans to have overly generous benefits could make the insurance too pricey for many individuals and small businesses. “Now you’ve got a wonderful product, but it’s one that no one can afford.” He also asked state officials to make their decisions in a timely manner and let insurers know what is expected of them, so they can change their offerings accordingly. “We, as the sellers of this product, aren’t going to be able to wait until the last minute.”

For more on the state’s implementation of the Affordable Care Act, see the current Illinois Issues.

To submit a comment to the implementation council, go to http://www2.illinois.gov/gov/healthcarereform/Pages/default.aspx

Presidential coattails less of a factor in state legislative races

 By Jamey Dunn

While the presidential election has captured the nation’s attention, Illinois political scientists say that the shifting regional demographics and the state’s new electoral maps will have a much larger impact on down-ticket legislative races in Illinois than the candidates at the top of the ballot.

“[President Barack] Obama will carry Illinois comfortably,” said John Jackson, a visiting professor with the Paul Simon Public Policy Institute at the Southern Illinois University. The president won the state with about 62 percent of the vote in 2008. Recent polling suggests that his popularity in Illinois has slipped since but still shows him leading Republican challenger Mitt Romney by a strong margin.

Even many Illinois Republicans admit that it is likely Obama will win his home state in the upcoming general election. "Let's face it: If Mitt Romney would win Illinois, he'd win by a biblical landslide nationwide. But I think Mitt Romney is going to run much better in Illinois than John McCain ran because I don't think Barack Obama is going to do that well in Illinois," former Gov. Jim Edgar told reporters at the Republican National Convention. Edgar said unpopular Democratic leaders such as Obama and Gov. Pat Quinn do not seem to be assets for Illinois Democrats running for state legislative seats.

“Where Obama’s numbers are not good downstate, and where Quinn’s numbers are not good, the Democrats are going to try to make the elections as local as possible,” said Kent Redfield, an emeritus professor of political science at the University of Illinois Springfield. “You’re going to see Democrats downstate running away from the national ticket, away from Gov. Quinn.”

In 2008, Obama carried 30 counties that previous Democratic presidential candidates John Kerry and Al Gore lost. Jackson — who looked at the 2008 results in his 2009 paper entitled, "The Anatomy of President Barack Obama’s General Election Victory in Illinois" — said it is likely that Obama will lose some of that ground this time around. He said an Obama win would likely look more like Quinn’s 2010 gubernatorial victory, with the president taking Democratic strongholds, such as Cook County and other northern counties. Jackson said Obama would also likely pick up a few downstate Democratic-leaning counties, such St. Clair County in the Metro East area near St. Louis.

Republicans predict a similar outcome. “I think you’re going to see a different election in Illinois, and I think you’re going to see a pretty good showing by Romney. Look, [Obama] is going to do very well in the city. We know that. But I don’t think you’re going to see the type of results in the collar counties and downstate that you saw the last time,” Illinois House Minority Leader Tom Cross said earlier this summer. However, Jackson said that Romney is unlikely to give other Republican candidates much of a boost, either. “I think symbolically, the Republicans will run with Romney. I am not sure he will make that much difference.” Jackson said Illinois Democrats are in danger of their base not feeling pressured to get to the polls because they feel that Obama will have no trouble winning the state. “The Democrats need to guard against that. The need to work pretty hard, not because of Obama but because of the other races [on the ticket].”

Jackson said that the so-called coattail effect of a presidential race is often overestimated in the lead up to the election. “The president rarely has much by way of coattails. I don’t expect strong coattails except on the issue of get-out-the vote drives.” In his 2009 paper, Jackson wrote that Republican might have overestimated the power of Obama’s coattails in 2008. “The Republicans especially fretted publicly over a potential ‘coattail’ effect from the Obama campaign harming the down-ballot Republican candidates’ races. There were predictions of further Republican losses in the Illinois congressional delegation and in the Illinois House and Senate because of the feared Obama electoral tide. Most of that fear proved to be unfounded or at least exaggerated in the end.”

Redfield said that the new legislative districts, which were drawn by Democrats, and changes in demographics will play a much larger role in state legislative races. However, he pointed out that the general election is still a ways off, and the presidential race could end up being more of a factor than expected. “Clearly, we don’t know what things are going to look like two months from now,” he said. “If it’s highly competitive, or even if Romney is pulling ahead [nationally], that’s going to generate enthusiasm.”

 Redfield said Democrats drew districts with an eye toward protecting the downstate incumbents while carving out new districts in the suburbs. “I think the map is defensive downstate and aggressive in the suburbs.” He added: “You could end up with a Democratic majority in the House and the Senate with a smaller percentage of downstate members in the caucus. In fact, I think that’s likely that there will be fewer downstate Democrats after this race.” Redfield said downstate Democrats face tough races, and when they do leave their seats, be it through losses at the polls or retirement, voters would likely replace some of them with Republicans. “Downstate is a problem for Democrats. I mean, there’s absolutely no questions about that.”

He said the potential for fewer downstate Democrats and fewer suburban Republicans could lead to more regional conflicts in the future. “Any time Chicago and the suburbs agree on an issue, downstate [would be] in trouble.”

Jackson said his biggest concern about the results of the presidential election is whether the winner can be effective. If Obama wins, he faces the possibility of pitching his policy ideas to a Republican majority in the U.S. House and maybe a Republican-controlled Senate. Jackson predicts that the national struggle for control of the U.S. Senate will be a nail biter. “I think that is the question. I think it’s so close in so many of the races it kind of depends on who’s got the best ground game.” If Romney wins, he could face a Democrat-controlled Senate. Or if Republicans gain a slim majority in the Senate, they may get a taste of their own medicine if Democrats use the same procedural moves that Republicans have during Obama’s first term to freeze big votes in the chamber.

Jackson says he is “cautiously pessimistic” about the potential for either candidate to achieve much in the way of policy changes after he is sworn in. “I’m looking for gridlock being the most likely outcome again.”

Friday, September 07, 2012

Canada and U.S. renew pact to protect Great Lakes


Asian carp found near Lake Michigan in 2010
By Jamey Dunn

The United States and Canada have signed a renewed agreement to protect the Great Lakes. The new version of the pact, which was updated today for the first time in 25 years, focuses on prevention and addresses new subjects, such as invasive species.

According to the Environmental Protection Agency, the goal of the Great Lakes Water Quality Agreement is “to restore and maintain the chemical, physical and biological integrity of the waters.” The agreement was first signed in 1972 and updated in 1987. “Joint stewardship of the Great Lakes — a treasured natural resource, a critical source of drinking water, essential to transportation, and the foundation for billions of dollars in trade, agriculture, recreation and other sectors — is a cornerstone of the Canada-United States relationship,” Canada’s Minister of the Environment Peter Kent said in a prepared statement. “The Great Lakes Water Quality Agreement supports our shared responsibility to restore and protect this critical resource and builds on 40 years of binational success.”

The agreement focuses on areas that were not subjects of the previous pact, including invasive species, habitat protection and climate change. The deal sets timelines for several goals, including plans to reduce phosphorus, a chemical that is often associated with runoff from agriculture and lawn maintenance, in Lake Erie to combat algae growth. Under the plan, projections will be created to assess the potential effects of climate change on the Great Lakes. The agreement also calls for the development of a plan to quickly identify and respond to the threat of invasive species.

Fears over a mass invasion of Asian carp into the Great Lakes have sparked debate and litigation among Illinois and its neighboring states. Former Michigan Attorney General Mike Cox unsuccessfully appealed to the U.S. Supreme Court in 2010 to close Chicago’s navigational locks in an effort to stop the spread of the species. Those in favor of closing the locks say that the fish could do irreparable damage to lake ecosystems as well as the fishing and tourism industries. Opponents said that closing the locks would put an unnecessary burden on shipping and could cause flooding and sanitation concerns.

A recent search for Asian carp DNA conducted by the state of Wisconsin in Lake Michigan turned up no evidence of the fish. A search of Lake Erie by the Ohio and Michigan natural resources departments and the U.S. Fish and Wildlife Service did not turn up any Asian carp either, but carp DNA has been found in the lake before.

“I’m pleased that after 25 years, the Great Lakes Water Quality Agreement is being updated to better reflect our scientific understanding and focus resources on the most pressing threats to this natural treasure,” Michigan Democratic U.S. Sen. Carl Levin, who co-chairs the Senate Great Lakes Task Force along with Illinois Republican U.S. Sen. Mark Kirk, said in a prepared statement. “With its emphasis on prevention of environmental damage, the agreement reflects a more cost-effective use of resources, as preventing damage is generally less costly than cleaning up ruined ecosystems. I am also pleased the agreement focuses on invasive species which are a continuing threat.”

Kirk echoed Levin’s support of updating the agreement to include new concerns while continuing to focus on threats the lakes have faced for years, such as chemical pollution. “I am fully committed to preventing toxic chemicals from poisoning our food supply and invasive species from damaging our ecosystem.”

Tuesday, September 04, 2012

Judge issues order halting prison closures

An Alexander County judge has issued a restraining order to block Gov. Pat Quinn’s plans to close several state corrections facilities.

 According to the American Federation of State, County and Municipal Employees Council 31, Judge Charles Cavaness issued the order today in Alexander County Circuit Court.

Quinn had intended to shutter a super-maximum-security prison near Tamms, a women’s prison in Dwight, adult transition centers in Decatur, Carbondale and Chicago and youth prisons in Joliet and Murphysboro, but AFSCME sued to block the closures. The union argued that moving prisoners to other overcrowded facilities would create unsafe working conditions for its members. In his order, Cavaness wrote that the closures "have the potential to make the prisons that remain more dangerous for employees."

An arbitrator ruled Friday that the closures violate the union's contract with the state and ordered Quinn and AFSCME to resolve the issue through ongoing contract negotiations.

Last month, Quinn temporarily stopped layoffs and the transfer of inmates, saying he would hold off on implementing his plan while legal proceedings played out. However, Kelly Kraft, a Quinn spokeswoman, said the administration is not backing down from the closure plan. “We are examining options.” She said Quinn hopes to resolve the matter quickly.

Saturday, September 01, 2012

Arbitrator: Prison closures violate union contract

By Jamey Dunn 

An arbitrator ruled today that Gov. Pat Quinn’s plans to close several state corrections facilities violates union contracts.

The American Federation of State County and Municipal Employees sued earlier this month to block the closure of seven state facilities. Quinn had planned to shutter a super-maximum security prison near Tamms, a women’s prison in Dwight, adult transition centers in Decatur, Carbondale and Chicago and youth prisons in Joliet and Murphysboro. The union and the administration agreed to take the issue to an arbitrator.

Most of the facilities were scheduled to close August 31, but Quinn agreed to put a temporary hold on the closures while legal proceedings played out, and the Associated Press reported this week that Department of Corrections officials sent letters to employees telling them to continue reporting to work.

Arbitrator Steven Bierig wrote in his finding: “The state violated the contract when it moved to close Department of Corrections Facilities and Department of Juvenile Justice Facilities prior to the conclusion of impact bargaining with the Union. The matter is remanded to the parties to conclude bargaining prior to the closure of said Facilities. The parties are ordered to conclude impact bargaining within 30 days of the date of this Award, unless agreed upon otherwise.”

AFSCME, the state’s largest public employee union, and the Quinn administration are currently negotiating contracts because the union’s previous four-year contract expired in June. Both sides agreed to extend the terms of the previous contract and seek the assistance of a mediator for future negotiations.

Today's ruling move comes the day after Cook County Circuit Court Judge Richard Billik Jr. told Quinn to submit vouchers to the comptroller’s office for AFSCME pay raises, which are under dispute. The judge has yet to decide whether the state must pay the raises, but he ordered Quinn to set aside the money so it will be available if he rules in favor of the unions. Quinn refused to pay the raises, saying that the General Assembly did not include the money in last fiscal year’s budget.

“Today's decision is another important step forward," Henry Bayer, executive director of AFSCME Council 31 said in a written statement. "Gov. Quinn's reckless rush to close prisons despite the consequences has been halted for now, but our work to protect the public safety continues. There is no rationale for closing these facilities. They were fully funded by the legislature, which recognizes that closing them would destabilize the entire prison system, worsen dangerous overcrowding and put the safety of employees, inmates, youth and the public at risk. We urge Gov. Quinn to drop his push to close needed prisons, undermine communities and destroy good jobs.”

AFSCME has asked a judge to make the ruling binding and order the state to comply. However, the Quinn administration has filed an appeal and asked that the ruling be vacated. "As we work to move Illinois forward by closing tax payer funded facilities the state no longer needs that are empty, half full, outdated and expensive to operate--it is disappointing that progress to make Illinois a better place and to put its financial house in order continues to be halted," Kelly Kraft, a Quinn spokeswoman, said in a written statement. "We remain committed to our closure plans and are eager to resolve this matter as quickly as possible."

Wednesday, August 29, 2012

Quinn: Credit downgrade bolsters calls for pension reform

By Jamey Dunn

The rating agency Standard & Poor’s reduced Illinois’ credit rating today, citing the state’s underfunded pension systems and continued budget worries.

The agency moved Illinois from an “A+” to an “A” rating. The rating agency also gave the state a “negative” outlook for the future. “The downgrade reflects the state's weak pension funding levels and lack of action on reform measures intended to improve funding levels and diminish cost pressures associated with annual contributions,” Standard & Poor's credit analyst Robin Prunty said in a prepared statement. “The downgrade also reflects continued financial weakness despite significant measures in the past two years to improve structural budget performance.”

S&P said that the negative outlook was based upon the potential for growth in the state’s unfunded pension liability, which stands at $83 billion. The agency also noted that the 2015 phaseout of the recent income tax increase could weaken the state's fiscal standing. Illinois now has the second lowest bond rating from S&P in the country. The state with the lowest, California, received a “positive” outlook from the agency.

A lower bond rating can lead to a higher interest rate for Illinois when it looks to borrow, something it does regularly to fund capital projects. Higher rates means borrowing will cost more.

However, Moody’s rating agency in January gave Illinois its lowest credit rating of any state, and on a bond sale later that same month, the state got the best interest rates it had seen since the 1970s. Quinn brushed off the downgrade when questioned by reporters at the time, pointing to steady ratings from S&P and Fitch Ratings. “Positive feedback like we have seen today from investors demonstrates the strong confidence investors have in Illinois,” David Vaught, then-director of the Governor’s Office of Management and Budget, said in a written statement released by Quinn's budget office to tout the January bond sale. “These bond bids make clear that investors know we are taking steps to correct the decades of fiscal mismanagement in our state, and they understand we continue to take major steps to reform pensions and control skyrocketing Medicaid costs in an effort to return Illinois to sound financial footing.”

In recent months, Quinn has used the possibility of further downgrades as a call to action for lawmakers who have yet to produce a pension overhaul that has the needed backing to pass in both chambers. “Today’s action is no surprise. Over and over again this summer, I made clear that if we do not act on pension reform, the state of Illinois would suffer the consequences. Now it has. Eliminating our $83 billion unfunded pension liability is vital to getting our financial house in order. Today’s action by Standard & Poor’s is more evidence that we must act,” the governor said in a prepared statement.

After a recent special legislative session that Quinn called to address pension reform produced nothing of substance, negotiations appeared to be at a standstill. Quinn said today that he plans to invite the four legislative leaders to a meeting to discuss pensions in September.

Tuesday, August 28, 2012

Quinn vetoes gambling expansion, citing ethics concerns

By Jamey Dunn
Gov. Pat Quinn shot down a gambling expansion bill today, but supporters hope to revisit the issue after the general election.

The move from Quinn today came as no shock to the bill’s sponsor. Quinn has kept quiet on what he intended to do, but he has been publicly critical of the bill. “The actions of the governor are disappointing, but they’re certainly not surprising,” said Skokie Democratic Rep. Lou Lang.

Senate Bill 1849 would have created licenses for five new casinos statewide: in Chicago, Park City, Danville, Rockford and in the south suburbs of Chicago. The location of the fifth casino would have been up to Illinois Gaming Board. The bill includes slot machines at horse racing tracks and would allow individual casinos to increase their gaming positions from the current limit of 1,200 to 1,600.

Quinn threatened to veto a similar expansion, SB 744, last year, calling it a “massive" gambling expansion. Senate President John Cullerton used a procedural move to block the measure from making it to Quinn’s desk. Quinn has also voiced opposition to allowing slot machines at horse racing tracks. The governor said in today’s veto message that he saw some positive changes in SB 1849, such as reductions in the scale of the gambling expansion from what was proposed in SB 744. However, he said that the newer bill did not have strong enough ethical standards. “The most glaring deficiency of Senate Bill 1849 is the absence of strict ethical standards and comprehensive regulatory oversight. Illinois should never settle for a gaming bill that includes loopholes for mobsters,” he wrote.

 “We don’t have any corruption in Illinois gaming. Where is his evidence that there is any mafia in Illinois gaming today? There isn’t any,” Lang said.

Quinn made several suggestions in his veto message for improving the measure, such as banning campaign contributions from gaming licensees and casino managers. Lang said he was willing to include any of the governor’s requested ethics measures and asked Quinn to provide him any provisions he wanted included before the legislation was called for a floor vote. “He wouldn’t give me any language, and so we proceeded and passed a bill,” Lang said. He said that Quinn had another opportunity to add in the ethics measures he wanted with his veto pen but opted not to. “The fact that he vetoed the bill instead of amendatory vetoed the bill tells you everything you need to know.”

 Lang added, “I have to draw the conclusion that he was never interested in gaming.”

When asked why he did not make his own changes to the bill, Quinn said: “It just has too many defects. It’s one thing if you had to make some technical changes here and there, but this bill just falls way short of what the people of Illinois need when it comes to ethics in government.” He said he planned to work with lawmakers to craft “a better bill,” which he described as “one that can meet all the requirements of integrity and also make sure the money goes to schools and education.”

However, Lang said that he thinks it is possible to  rally enough support for an override in the legislature's November veto session, despite a comment from House Speaker Michael Madigan to the contrary. “Speaker Madigan was only making a prediction,” Lang said.

“I’m very saddened,” said Waukegan Democratic Sen. Terry Link, who also sponsored the bill. “This is just ridiculous. Again, we have done everything possible to make this work, and again, the goal line has changed.”

An override would have to start in the Senate, and Link said he has not yet made up his mind. He said he plans to decide in the time between the general election and veto session. “We’ve got a three-week window in there, and we’ll be doing a lot of phone calling then,” He said. “People will be either comfortable or happy or sad or whatever they are.”

Link admitted, “It will be in the back of my mind for the next two months.”

Quinn used his veto message to again urge lawmakers to take up the issue of pension reform. A recent special session on pensions produced no substantial results. “Illinois cannot gamble its way out of our fiscal challenges. Even a casino on every street corner cannot repair the state’s $83 billion unfunded pension liability. I urge the members of the Illinois House and Senate to address the most pressing issue of our time — comprehensive public pension reform.”

Monday, August 27, 2012

Quinn vetoes plastic bag recycling plan, leaving door open for local bans and taxes

By Jamey Dunn

Gov. Pat Quinn shot down a bill that would have created a statewide recycling pilot program for plastic bags, but supporters of the measure are skeptical about the issue being addressed on the local level.

Under Senate Bill 3442, plastic bag manufacturers would have been required to register with the state and pay fees that would have gone toward a statewide recycling program. Retailers would have been barred from buying bags from producers not registered with the state, and manufacturers would have had to offer recycling collection for plastic bags and plastic films in 90 percent of the state’s counties by 2014. The program would have sunset after four years.

“This is an industry-driven private approach to a public policy problem that could be solved without taxpayer financing,” says Crystal Lake Republican Rep. Michael Tryon, a sponsor of the bill. The U.S. Environmental Protection Agency estimates Americans use 380 billion plastic bags and wraps a year. Illinois generates 494,280 tons of plastic film annually. But the measure also would have closed off options to local municipalities, such as charging fees for bags or banning their use altogether. Champaign is one city that was recently considering levying a per-bag fee to try to get consumers to cut down on using the bags.

Quinn said in his veto message that he agrees with the intent of the bill, but that it went too far in limiting what local governments could do to address the problem. “This bill is more restrictive on municipalities than any other plastic bag regulation in the country, which creates a roadblock for locals to choose the policies that fit the needs of the area. Communities throughout the country experienced great success with different types of policies, as can be seen in the numerous municipalities in California that enacted an outright ban on plastic bags.”

Sen. Terry Link, a sponsor of the bill, said the plan was modeled after a pilot program in Lake County. He said the legislation was the result of five years of negotiations with manufacturers, retailers and other interested groups. “I’m kind of perturbed today — in plain words. I put a lot of work into this, and a lot of people put a lot of work into this.” Link, a Waukegan Democrat, said he is uncertain about whether he will push for an override of Quinn’s veto. The measure passed with bipartisan support in both legislative chambers and had more than enough supporters to override Quinn’s veto. However, three House members who voted in favor of the bill — including the recently ousted former Rep. Derrick Smith — have since left the body. Link said he will gauge the changes of a successful override when lawmakers return for their veto session, which is scheduled for November after the general election.

Critics of Link’s plan say it would have done little to keep bags off streets and out of landfills and waterways. They cite the low level of current recycling rates, even though several large retail chains already offer on site recycling collection. In Illinois, an estimated 1.5 percent of plastic bags are returned for recycling, .7 percent of commercial and industrial plastic films are returned for recycling and only .3 percent of other plastic films, such as those used in consumer packaging, are returned for recycling. “I share concerns that this program would not increase the rate of recycling beyond the natural growth. Local authorities and the environmental community strongly oppose this program because the metrics are simply not aggressive enough and home rule preemption prevents more stringent local regulation,” Quinn wrote.

While Link frames the measure as a compromise worked out to bring the industry on board, environmental groups say it is a preemptive strike by businesses and manufacturers to keep cities from banning bags or enacting fees. “Business groups want to prevent Illinois cities from doing the bag-use reduction programs that are happening in other states,” said Jennifer Walling, executive director of the Illinois Environmental Council. “That's the real goal of this legislation.” An analysis of the bill that a coalition of environmental groups sent to Quinn claims that many of the goals in the measure, such as the reach of recycling programs into 90 percent of counties, have "likely" already been met through voluntary recycling programs at large retail chains.

 Link said that local governments have had years to address the issue, and little has been done. “Where were all these cities who are, in the 12th hour, complaining about it? They had years to make ordinances and put them into effect.”

For more on what other state's and municipalities are doing to address plastic waste pollution, see Illinois Issues July/August 2010.


Wednesday, August 22, 2012

Quinn plans to act on gambling expansion bill next week

By Jamey Dunn

Gov. Pat Quinn said that he does not plan to make a decision on a gambling expansion bill until his final day to act, which is Tuesday.

“I’ve been really looking at that bill. I will look at it really through the weekend. I probably won’t have a final answer until Tuesday,” Quinn told reporters in Chicago today. “It is a complicated measure. It’s about as thick as the Chicago phone book. And we're going through it line by line, and we have to because we found some things that need close intention.” Quinn said his biggest concerns when looking at the bill are “ethics and integrity,” as well as “oversight of gamblers and gambling interests — casinos and casino owners.” The governor has called for a ban on campaign contributions from individuals with gaming interests, such as casino and racetrack owners.

The sponsor of Senate Bill 1849, Rep. Lou Lang, said he believes that such a ban would be unconstitutional. However, the Skokie Democrat said he would support legislation calling for such a ban if it would help to win Quinn’s support of his legislation.

SB 1849 would allow for five new casinos statewide: in Chicago, Park City, Danville, Rockford and in the south suburbs of Chicago. The location of the fifth casino would be decided by the Illinois Gaming Board. The bill includes slot machines at horse racing tracks but does not allow for slots at the Illinois State Fairgrounds or Chicago airports, which Quinn has spoken out against. The measure would also allow casinos to up their gaming positions from the current limit of 1,200 to 1,600. Quinn threatened to veto a similar expansion last year, calling it “massive." He has also voiced opposition to allowing slot machines at horse racing tracks.

Lang said that Quinn has never given him a clear description of the ethics measures he would like so see. “I’ve offered to meet with the governor anywhere, any time any place to discuss gaming issues and as of yet me offer has been ignored,” he said last week. “It’s impossible for me to draft legislation or make change in the bill to satisfy the governor, when the governor won’t tell me what those changes are. He’s made some vague references in the press about campaign donations and ethics.”

Quinn also said today,:“I always believe that the money should go to education. We have to make sure if we’re going to have any kind of gambling that the resources and revenues be used for important things that make a difference in our society.” SB 1849 would funnel money to other areas, such as agricultural programs and paying off some of the state’s billions in overdue bills owed to vendors, schools and providers.

 Lang said that if Quinn does choose to sign the bill next week, “I’ll be the most surprised person in the Capitol.” House Speaker Michael Madigan said last week that he does not think there will be an override if Quinn vetoes the measure. But Lang disagrees. “I’m prepared for any eventuality. I’m prepared for a signature, a veto or an amendatory veto, and I think we’ll be able to override.”

Tuesday, August 21, 2012

Thousands in Illinois likely eligible for deferred deportation program

By Jamey Dunn 

A new policy from President Barack Obama’s administration opens the door for thousand of undocumented young residents of the state to temporarily avoid the fear of deportation.

Since August 16, undocumented youths can apply for a program called Deferred Action for Childhood Arrivals, which offers two-year renewable reprieves from deportation. To qualify, applicants must be able to prove that they are 30 or younger, that they came to the country before they turned 16 and that they are students, graduates or have served in the military. Those applying must have must have clean criminal records.

Applicants may also be eligible for work permits. Fred Tsao, policy director for the Illinois Coalition for Immigrant and Refugee Rights (ICIRR), said an August 16 Chicago event to assist potential applicants, which the group helped organize,  had an estimated attendance of 13,000 people. He said that the crowd was so big that organizers had to turn some people away. Tsao said that about 7,500 people received advice, and 1,500 received assistance with processing their applications. Less than a week after the policy went into effect, Tsao says “The response has been powerful.”

ICIRR estimates that about 75,000 people in the state may be eligible for a deferment. “They may also be granted a work permit,” he said. “If you are granted a work permit, you can get a social security number, which means, of course, you can work legally.” In Illinois, it also means you can get a driver's license.

The Pew Hispanic Center estimates that up to 1.7 million of the approximately 4.4 million undocumented immigrants in the country who are 30 or younger could potentially qualify for the program. The application charge for the program is $465, which is the cost to apply for a work permit. Tsao cautions that, while many who receive the deferment may get a work permit, some will not. “It’s not automatic.” Work permits will be temporary and renewable.

Obama put the policy in place through his executive powers after years of fruitless efforts at passing the DREAM Act, which would have offered many young immigrants a path to citizenship. “Now, let's be clear — this is not amnesty, this is not immunity. This is not a path to citizenship. It's not a permanent fix. This is a temporary stopgap measure that lets us focus our resources wisely while giving a degree of relief and hope to talented, driven, patriotic young people. It is the right thing to do,” Obama said when he announced the program.

 “The initiative is an opening for undocumented immigrants to — on a trial basis — be here, study and work all under lawful auspices. It is an opportunity, as well, to challenge the perception of undocumented [immigrants] particularly of undocumented youth, who in nearly all cases are people who are eager to be Americans, in fact as well as in spirit,” Tsao said.

Critics call the policy a cynical attempt at pandering from a president in a close re-election race. “Congress has never said the president has he power to do what he’s doing, but states are apparently expected to cough up billions and billions of taxpayer dollars to provide one benefit after another to a group of people that are here illegally,” said Dan Stein, president of the Federation for American Immigration Reform. Nebraska Gov. Dave Heineman and Arizona Gov. Jan Brewer have announced that residents receiving deferrals in their states would not be eligible for any state benefits, such as driver's licenses.

Stein called the program “unconstitutional” and a “gross abuse” of the president’s power. “The big problem with this status is that it appears to be dependent on the president getting re-elected,” he said.

“It is a definite concern that the policy may change as a result of the election,” said Tsao. But he said that the program is a result of the grassroots advocacy lead by young people, who have been holding demonstrations, lobbying their elected officials and taking the risk of “coming out” as undocumented. “This intuitive was won largely as a result of young people coming forward, putting themselves at risk. ...It’s going to take just as much courage to keep this initiative won, regardless of who is president.”

Tsao recommends that those considering applying for the program seek out an immigration lawyer or advocacy group. “We are recommending that these young people consult with attorneys or authorized not-for-profit organizations that practice immigration law, if only because some of them may actually qualify for more permanent benefits. They may just not realize it,” he said.

 For more information on the program, see the ICIRR’s dedicated website, DreamRelief.org and the Chicago-based Heartland Alliance National Immigrant Justice Center’s website, dreamerjustice.org.

Friday, August 17, 2012

After having no luck with lawmakers, Quinn says he will take pension reform to the people

 By Jamey Dunn

A one-day special legislative session to address the state’s struggling pension systems produced plenty of finger pointing but no reforms.

A plan that would only have affected members of the General Assembly Retirement System failed to get the support needed to pass. Senate Bill 3168 would have forced members of the General Assembly pension system, which includes lawmakers and constitutional officers, to choose between keeping their 3 percent compounded-interest cost-of-living increases or hanging onto their state-subsidized retiree health care. The bill also would have eliminated pensions for any new members of the system. The House voted to adopt an amendment containing the language of the bill, which required only the majority of those lawmakers present, but supporters did not get the 60 “yes” votes needed to pass the bill. The measure was not called for a final vote.

No new pension reform proposals emerged from the Senate, which adjourned before the House began debating SB 3168. During the spring session, the Senate approved House Bill 1447, which would apply to members of the General Assembly and state workers. Supporters pitched that bill as the last resort of the day because no agreement could be reached on any other proposals. “The pensions committee has passed out three very comprehensive bills over the last two years. None of them have been able to pass in this chamber,” said Northbrook Democratic Rep. Elaine Nekritz, who served on a pension working group that tried to come up with legislation that would pass during the regular session. “We need to do something to demonstrate that the General Assembly can do something to take action on this issue. ... We do need to be taking this step because of what it says to the public about our willingness to take action.”

Chicago Democratic Rep. Barbara Flynn Currie agreed. “Where have those proposals gone? Nowhere. They’ve gone to the dustbin. Because there is not consensus for comprehensive pension reform today.” Currie argued that lawmakers could take a small first step by reducing their own benefits. “This at least begins reform right here at home.” Republican opponents said that the vote was just meant to give Democrats a way to claim that they had taken action on pension reform. “This is a bill that provides cover in a political campaign. It’s a political vote,” said House Minority Leader Tom Cross.

The governor’s budget office estimates that the measure affecting lawmakers would save $111 million between its effective date next year and 2045. The total unfunded pension liability is estimated at $83 billion. Republicans argue that it might actually be more because they say the return on investment estimates for the systems are not realistic. Those opposed to the measure say that, when the savings are compared with the entire liability, it would make no real progress. “Frankly, I would be hard-pressed to look voters in the face and explain why I voted for this bill,” said Rep. Dwight Kay, a Glen Carbon Democrat.

“In the context of the overall problem, I think we all agree that this does absolutely nothing,” Cross said. He and many of his fellow Republicans called on Gov. Pat Quinn to keep lawmakers in special session until a pension plan passes. “We will stay here for as long as it takes.” Cross said. “But it needs to be done in a very very comprehensive manner. This doesn’t even come close.”

Quinn has other ideas.

“I was disappointed with the legislature today,” Quinn said after both chambers adjourned. He said that he does not plan to call lawmakers back for a special session in the immediate future. Instead, Quinn said he plans to launch a “grassroots” campaign to reach out to voters and business groups and urge them to put pressure on lawmakers. “I think there’s a lot of explaining to do to the voters and taxpayers back home if members of the Illinois House of Representatives are voting now on something as fundamental as reforming their own public pension system,” Quinn said. “It’s pretty clear to me that we’re not going to continue to engage with Republican leaders who are not sincere about voting for public pensions reform. We’re not going to let them just deny and delay. I think it’s time to get the people involved.” Quinn said that Republican legislative leaders rejected every proposal he pitched to them this morning.

But Republican leaders say that it is Democrats who are either not genuinely interested in passing reform or bungling the job. “You’ve got two Democrat[ic legislative] leaders who don’t want to really do it and a governor that really doesn’t know how to do it and so when you’ve got those two things going on, it’s pretty difficult to get to the goal line.”

 Quinn has always been a fan of grassroots movements, and the idea harks back to his time as a political organizer and gadfly before he served as state treasurer, lieutenant governor and governor. He has had success, such as a movement that culminated in “the cutback amendment,” which reduced the number of lawmakers in the House. However, he has not had much luck with rallying people to influence the legislature since he has taken office as governor. He appealed to citizens when he opposed smart-grid legislation that he said would result in unfair electric-rate increases for consumers. Quinn launched a website for public comment and encouraged people to contact their lawmakers, but legislators voted to override his veto of the bill. When asked how this campaign would be different than that one, Quinn just said, “You’ll see.” A Quinn spokesperson said the governor plans to reveal more details about his campaign next week.

House expels Smith, but he could return

By Jamey Dunn

The Illinois House expelled Derrick Smith today, but the embattled former representative could return to the ranks of the body if voters choose to vote him in this November.

The vote to expel Smith, who allegedly took a bribe in exchange for an official act, came as no surprise. The House disciplinary committee that recommended expulsion voted unanimously that Smith was at fault, and all but one member recommended expelling him. Smith was not present at the disciplinary hearing or during today’s vote. One hundred members voted in favor of kicking Smith out, while six voted against it. Three lawmakers voted “present.” The vote took effect immediately, and Smith’s name was removed from the House roll. It is the first time House members have expelled one of their own since 1905.

Smith was arrested in March and is accused of taking a $7,000 bribe in exchange for writing a letter of recommendation for a daycare center he believed was seeking a state grant. Smith was the subject of a federal sting, and the daycare was not actually seeking the grant. “Using one’s office for personal gain not for the public good is an affront to the core reputation of every legislator. To act in this way is to me a stunning violation of the oath of office each of us has promised to uphold. I can think of no greater breach of the public trust,” said Rep. Barbara Flynn Currie, who served on the committee that recommended expelling Smith. Several House members said that if Smith had gone under oath and denied that he had taken a bribe, today’s vote likely would have not occurred. Since the disciplinary committee had little evidence to work with other than the criminal complaint against Smith, Currie said it would have been difficult to refute the claims Smith could have made.

Elmhurst Republican Rep. Dennis Reboletti said that House members should take the information in the criminal complaint at “face value” because Smith never denied any of the allegations against him. “When you get down to the heart of the matter, Rep. Smith chose not to testify in front of us. He chose not to deny that those conversations [regarding the alleged bribe] in that affidavit ... ever took place. He had three opportunities in front of our special investigative committee to do so,” said Reboletti, who served on a preliminary committee that decided whether there was enough evidence to proceed with disciplinary action against Smith. Smith was allowed to plead the Fifth Amendment, which protects against self-incrimination, and choose not to testify in front of any of the House members. However, unlike in criminal court, House members were able to take his choice not to testify into consideration when decided whether to expel him from the chamber.

Those opposed to booting Smith did not defend his alleged actions, but they urged the lawmakers to wait until there was more evidence. They said that Smith had likely opted not to testify under oath because his lawyer advised him not to. Rep. Mary Flowers, a Chicago Democrat, called the proceedings “a dog and pony show.” She said that expelling somebody over unproven allegations sets a dangerous precedent. Flowers also noted that today’s vote means that lawmakers may have few options to get rid of Smith if he is elected to the House in November.

If Smith wins his bid in the general election, the House cannot expel him again over the same offense. He won his primary election race in the 10th House District with 77 percent of the vote. “He’s still on the ballot. And it is ‘we the people’, the people of his district that will have the say. They will be the ones to say if Mr. Smith will come back to this House or not,” she said. “There’s nothing that we will do here today that will stop him from coming back. And then what?”

Rep. Jim Durkin, who helped argue the case against Smith in front of the disciplinary committee, said that since Smith is the subject of an ongoing investigation, there is a possibility that he might face other criminal charges in the future. Durkin, a Republican from Western Springs, said if that were to happen, Smith could be expelled over another charge. “My hunch is that this case is not completely done,” he said. “If that is not the case [and he wins the election,] then Rep. Smith will be sworn in and seated next January because we can’t remove him for the charges for which we removed him today. However, Durkin said that the charge against Smith is so serious that it was necessary to take action and not wait until after the election.

Smith told reporters at a Chicago news conference that he was “sad” about today's vote. But he said there is a silver lining. "I am happy because through this ordeal, I have been able to learn who my friends are," Smith said. He said he plans to remain on the ballot. Many Democrats, including Smith’s former political ally Secretary of State Jesse White, have thrown support behind his opponent, third-party candidate Lance Tyson.

Thursday, August 16, 2012

Senate Republicans split on 'partial' pension reform

By Jamey Dunn

Republican legislative leaders predict little will come of tomorrow’s special session on pension reform.

House Speaker Michael Madigan said yesterday that any hope that a bill will pass lies with a meeting scheduled tomorrow between House Minority Leader Tom Cross and Gov. Pat Quinn.

Cross called Madigan’s remarks “disingenuous” and said all four legislative leaders have been invited to the meeting. “Let’s quit the games. This is kind of the old Mike Madigan school [of thought] We’ve read the book. We’ve seen the movie. This a problem that we all need to solve, and everyone needs to be an adult. Everybody needs to get in a room and work it out. I think we should have been in a room working it out weeks ago. We didn’t. We’ll be there tomorrow. We’re willing to stay as long as it takes,” Cross said. “This is very serious. That approach that the speaker used is really one of the reasons we’re in this mess. It’s politics after politics after politics.”

Cross has said that Quinn should keep lawmakers in session until a solution can be reached. Cross does not support any of the pension proposals that are likely to be up for consideration tomorrow. Madigan yesterday said House Bill 1447, which the Senate approved, would be “progress.” That measure would only apply to state workers or members of the General Assembly. Under the proposal, employees and retirees would have to choose between keeping either a 3 percent annual cost-of-living increase based on compounded interest or state-subsidized health care benefits. Current employees who choose to keep the compounded cost-of-living adjustment would also not be able to factor any future raises into calculating their pension benefits. But Cross said he will not support a plan that leaves out teachers and university employees. “We believe that we need to do something substantive, and we need to do something real, and this nibbling around the edges and then claiming, ‘We have pension reform and that we fixed it’ again is an old playbook. We saw it with campaign finance [reform]. We saw it with workers' compensation. We want something real. I think we have one shot at it.”

Senate Minority Leader Christine Radogno originally voted in favor of HB1447 but backed away from the proposal today. “When it was passed, we were pretty clear that we thought that it was inadequate in terms of the fact that it only covered two of the five systems,” Radogno said. She cited concerns over estimates that could put the unfunded liability pension at a higher figure than the oft-cited $83 billion. “That bill clearly is not enough.” Radogno agreed with Cross that passage of the bill in the House could stall efforts at more comprehensive proposals. “The concern is that it will stop forward progress because a lawsuit will immediately be filed, in which case probably the party in power would say, ‘Well, we’ve got to wait until that unfolds and see what happens.’ So it’s just inadequate on too many fronts at this point.”

But not all of her GOP colleagues see it that way. Sen. Bill Brady, a Bloomington Republican, called HB1447 a “half measure,” but he said that if it is the only option that can gain enough backing to pass, he would support it. “Something’s got to be done,” Brady said. “This is the only solution on the table. Rome’s burning, and we need some incremental solution for this problem.” Brady does not share Cross’ and Radogno’s concerns that passing the bill would freeze efforts to reform the other systems. “I would argue that if we pass this, it will lead to passage [of reform] in the other systems.”

Sen. Matt Murphy agreed. “For those that say that it’s not enough and passing this doesn’t qualify as real reform, I agree wholeheartedly.” However, Murphy, a Palatine Republican, said he doesn’t think passing HB 1447 would hurt the reform process, and he said he would support it. “Personally, I don’t think the fact that we pass some pension reform means anybody thinks we’re done. I don’t think we’re done with just this bill, and I don’t think it takes the pressure off to solve the rest of the problem,” he said. “I think you can take what you can get now and then don’t slow the momentum. Use it as a springboard to finishing the job on the other systems.”

Wednesday, August 15, 2012

Madigan says there will be no override if Quinn vetoes gambling expansion

Jamey Dunn

House Speaker Michael Madigan said that if Gov. Pat Quinn vetoes a gaming expansion measure passed at the end of the spring legislative session, it may be the end of the line for the bill.

When asked whether he thought that there would be a successful override if Quinn rejects Senate Bill 1849, Madigan simply said, “No.”

Quinn has yet to act on the bill, but he has been publicly critical of it, saying it does not contain ethics  provisions that he thinks are necessary. He said earlier this week that he is still weighing his choice.

The expansion would mean five new casinos statewide, in Chicago, Park City, Danville, Rockford and in the south suburbs of Chicago. The exact location of the fifth casino would be up to the Illinois Gaming Board to decide. The bill includes slot machines at horse racing tracks, which Quinn has opposed, but does not allow for slots at the Illinois State Fairgrounds or Chicago airports, which Quinn was very vocal in opposing.

The governor has not been receptive to broad gaming expansions in the past. He proposed a drastic trim back of a gambling bill, which lawmakers approved last year. Supporters of the plan in the Senate used a parliamentary procedure to keep the bill from ever reaching Quinn's desk.

"I think the [House] speaker is wrong. I think we'll have votes in the House and in the Senate to override a gubernatorial veto," said Skokie Democrat Lou Lang, who sponsored both gambling expansion bills. "Now, [Quinn] hasn't vetoed the gaming bill yet. Maybe he'll surprise us and sign it. And if he does, I'll be the most surprised person in the Capitol. But I'm prepared for any eventuality."

Lang said the bill he sponsored has strong ethics provisions, but he also said he is open to the governor's suggestions. "I'm prepared to give the governor virtually anything he wants."

Governor's Day at the fair turns into loud protest


By Jamey Dunn

Gov. Pat Quinn found few allies today in his push to reform the pension systems for retired state workers.

Quinn faced a wall of sound from union protesters as he spoke on Governor’s Day at the Illinois State Fair this afternoon. His speech was barely audible over loud booing and chants of “Respect Illinois workers.” Several protesters shouted out “Keep your promises” as the governor tried to make himself heard over the crowd. A plane circled overhead carrying a banner that read “Gov. Quinn — unfair to workers.”

The event, usually meant to be a sort of pep rally for the party holding the governor’s office, instead served to display deep divides among Illinois Democrats over pension reform, the closure of state facilities and budget cuts that Quinn has said necessitated  layoffs of state workers and a freeze on contractual raises.

Since lawmakers are scheduled to be in special session on Friday to debate pension reform, it was the issue of the day. House Speaker Michael Madigan laid the success or failure of pension reform in Friday’s special session at the feet of Quinn and House Minority Leader Tom Cross. He said the two are scheduled to meet Friday morning “So hopefully, we’ll get some resolve out of those discussions between Governor Quinn and Leader Cross,” Madigan said at a Democratic party breakfast this morning.

Quinn drew some protesters to the morning event, where union members handed out fliers and called out, “Act like a Democrat, Pat!” But it was little, compared to the pushback at the state fair, where protesters followed him on his way to the event booing and chanting and even crowded around him while he stopped for a snack.

“If you want to be governor of Illinois and you want to step into the arena, you’d better have a tough hide. I have a lot of people who may call me names, but I think there’s a lot of people in Illinois who agree with what I am trying to do, which is to make sure we invest in our children and have good education. And sometimes you have to make reforms like in the pension that are difficult but necessary for everyday people to have a good state,” Quinn said this morning. “We’re going to reform the pensions, and I know some of the state workers don’t like that, but they’re going to have accept what the voters — I think — at large want.”

Skokie Rep. Lou Lang, a member of Democratic leadership in the House, said that he applauds the union members for making their voices heard at the fair. However, Lang said: “I understand their concerns, and in many ways, I agree with them and may be voting with them. That still does not mean that we should not give the governor his due respect as the governor [and] as a person who has supported the things that matter to the men and women of organized labor for a very long time.”

Lang said he was disappointed that the party did not present more of a unified front today. But he also said that the scene was illustrative of the party’s history. “It was a bunch of Democrats getting together. And Democrats are pretty noisy when they get together, and we don’t always agree. I’m sure the Republican rally tomorrow will be a lot more homogenized, and I’m sure the Republican rally tomorrow will be a lot quieter. But having said all that, this is what the Democratic Party is. It’s what it’s about. It’s what it’s always been about. I’m proud of what happened today.”

Madigan, who is also the chair of the Democratic Party in Illinois, brushed off the acrimony over pension reform and other issues, saying he did not think it would do permanent damage to his party in the state. “We’re trying to balance the budget. We’re trying to improve the fiscal condition of the state of Illinois. People from organized labor are representing their people, and they ought to do that. ... It’s just a natural conflict that’s going to be there. I don’t think there’s any long-term adverse implications that are going to come out of it,” he said at the morning event. “Promises were made. But if you don’t have the money to pay the promise, I think you have to step back, bring everybody together, talk reality and look toward how we can restore some fiscal stability to the [pension] systems and to the state of Illinois.”

Madigan said that House Bill 1147, which would only apply to state workers and legislators and avoids the issue of shifting pension costs to local school systems and universities, would be progress. He said he presented a comprehensive reform plan during the regular session, but it was not approved by the House.

Quinn supports a plan from Rep. Elaine Nekritz, a Northbrook Democrat, that would apply to all state retirees. Nekritz’s bill would phase in a controversial cost shift to schools and universities more slowly than a plan that failed to gain Republican support at the end of regular session. “I really would like to see both leaders in the House of Representatives put 30 votes on a bill sponsored by Rep. Elaine Nekrtiz,” Quinn said. “It’s a good bill. It’s a reasonable bill. It will reform the pensions and do it once and for all in Illinois.”

Cross supports neither plan. He is opposed to proposals that would ask downstate and suburban schools and universities to assume the retirement costs for their workers. Cross said supporters claim that the cost would be 6 percent to 9 percent of payroll for most schools. However, he said that there are many factors that could make the numbers spike. “That’s a floor, and given the unfunded liability numbers out there, given the potential for market drops, given the potential for change in interest rates assumption, or [if] the General Assembly doesn’t make payments, that number climbs significantly,” Cross said at a Chicago news conference yesterday. Cross and other Republicans say a cost shift could result n increased property taxes and layoffs. Cross said he does not back a proposal that leaves out schools and universities. “If we do that bill, the day it becomes law, we’ll see litigation. It’s inevitable that we’re going to see litigation, and once that litigation starts, it’s our belief that we will cease the discussions on pension reform until the conclusion of a lawsuit.”

 Cross said Quinn should keep lawmakers in session until a deal can be reached. “This needs to happen. It doesn’t need to happen after the election. It needs to happen now. ... And so, call us back to special session. And people are going to yell and scream, and they’re going to complain, and it’ll be chaotic down there [in Springfield]. But my approach is.,you put us in a room, lock the key, and when we’re done, you let us out.”

Despite the lack of agreement, Quinn remains optimistic that things could still fall in line to pass a bill on Friday. “I think each of the leaders is waiting for the other to move forward. And I hope we can in the next couple of days get everybody to jump aboard at the same time. Hold hands and let’s go together.”

Monday, August 13, 2012

Unions pitch their own pension reform plan

By Jamey Dunn

Union officials laid out the broad strokes of their own pension reform plan today. 

Cinda Klickna, president of the Illinois Education Association, described the plan backed by We Are One Illinois—a coalition of public employee unions, which includes the Illinois AFL-CIO, the American Federation of State, Country and Municipal Employees, Service Employees International Union and unions representing teachers, police, firefighters and transportation workers. Klickna said that group seeks a guarantee that the state will make the required pension contribution. Under the proposal, the priority of the pension payment would only be second to the state’s creditors. Union officials argue that legislation that is currently up for consideration does not do enough to ensure that lawmakers make the annual pension payments. They point to skipped pension payments as the primary cause of the state’s more then $80 billion unfunded pension liability. “The pension crisis was caused by past governors and legislators that failed that people of the state,” Klickna said.

The group also is proposing that lawmakers reevaluate corporate tax breaks, such as the package of tax cuts recently passed to benefit Sears and the CME group. The collation is focusing on a group of tax breaks, the elimination of which they say could save the $80.7 billion over the next 34 years. On the list are tax exemptions for paper and ink given to news outlets, a tax exemption for foreign dividends and a tax break given to retailers for collecting the state’s sales tax. “We cannot longer afford to let these big corporations off the hook will vital services continue to be slashed,” said Henry Bayer, executive director of AFSCME Council 31. “We need to reform our tax system. It’s long, long overdue. ... We need to focus on where the money is -- what we can afford and what’s fair.”

All of the tax breaks have the backing of relatively powerful lobbying groups and could be a tough sell to legislators who are concerned about giving the appearance of being pro jobs and business friendly in the wake of the economic downturn.

The union coalition is also asking that any changes would not affect current retirees. In exchange for those three considerations, the group says that current workers would pay more toward the cost of retirement. Klickna said that such an increase would need to be negotiated, but she said the amount would likely vary across the different pension systems. “The employees didn’t cause the crisis, but we’re going on record today to say our members are willing to help fix it if the state will guarantee that the politicians will never again divert our pension money to other expenses,” Michael Carrigan, president of the Illinois AFL-CIO, said in a prepared statement.

The move comes as lawmakers are scheduled to return to Springfield this Friday to take up the pensions issue during a special session called by Gov. Pat Quinn. However, Quinn’s camp does not seem responsive to the plan. “This is nothing new, and all has been discussed before,” Brooke Anderson, a spokeswoman for Quinn, said in an emailed response to Illinois Issues. “This proposal would not solve the state's pension challenges, nor is it feasible.”

 House Speaker Michael Madigan reportedly plans to call House Bill 1447, which the Senate approved on the last day of the spring legislative session. The measure would require employees and retirees to choose between keeping either a cost-of-living increase based on compounded interest or state-subsidized health care benefits. Current employees who chose to keep the compounded cost-of-living adjustment would also not be able to factor any future raises into calculating their pension benefits.

Unions maintain that the pension reform plan is unconstitutional and presents workers and retirees with a false choice between two bad outcomes. “If I had to chose between my [COLA] and my insurance, it would be like asking me to cut off my right hand or my left hand,” said Barbara Gilhaus, a retired teacher. Gilhaus said she gets about $28,000 annually from her pension.

Supporters of the plan to offer employees a choice between health care and compounded COLAs say it passes constitutional muster because it allows employees to decide what benefits that may want to trade off to keep others. Quinn also recently signed Senate Bill 1313, which will result in retirees paying more for their health care coverage. While the state still plans to kick in to cover some of the health care costs for retirees, some retirees will have to start being premiums under the plan.

HB 1477 only applies to state workers and members of the General Assembly. Democrats and Republicans cannot agree on whether universities, community colleges and downstate and suburban schools should have to pick up the cost of their employees' retirement. There are multiple bills on the table that would sift the costs to schools over several years. But so far, Republicans have staunchly opposed them, and Democrats have been unwilling to back off the issue. Leaving the retirement benefits of teachers and university employees out of any pension vote that may happen on Friday would allow lawmakers to revisit the issue of the cost shift after the general election.

Friday, August 10, 2012

Quinn's veto could snuff out plans for coal-to-gas plant

By Jamey Dunn

Gov. Pat Quinn rejected legislation that would have cleared the way for a coal and petroleum coke gasification plant on the southeast side of Chicago.

Last summer, Quinn approved a plan to build the plant, which would be owned by Leucadia National Corp. Construction and built on a polluted brownfield site on the southeast side of Chicago. The project was scheduled to begin in 2015, but Quinn’s veto of Senate Bill 3766 puts the future of the plant in question.

Two utility companies that originally signed onto the project, Peoples Gas and North Shore Gas, bowed out. The two remaining utilities, Ameren and Nicor Gas, have argued that they would be stuck with too large of a share of the cost of construction. Both utilities would be required to buy gas from the plant, but they do not want to cover the construction expenses that the two utilities that left the project would have paid. The Illinois Commerce Commission sided with Ameren and Nicor and rejected contracts that would have locked the utilities into a 30-year deal with the Leucadia plant, which has been dubbed the Chicago Clean Energy project. Senate Bill 3766 would have overridden the ICC’s ruling, but Quinn vetoed the bill this afternoon. Leucadia representatives have said that the project would not move forward without approval of the bill.

Business organizations and consumer advocates argued that the project would increase natural gas rates for customers across the state. ‘We’re not universally opposed to projects like these. However, Leucadia forced suburban and downstate to pay more than their fair share, and that’s unacceptable for consumers,” Bryan McDaniel, director of government affairs for Citizens Utility Board, said in a written statement. “CUB applauds Gov. Quinn’s continued leadership on behalf of consumers across Illinois.”

 The controversy put Quinn in an awkward position. He supported the plant and the jobs it would bring to an economically depressed area of the state. However, he founded CUB and has presented himself as a consumer advocate for decades.

 In his veto message, Quinn said he still supports the project but that it must be revamped. “In September of 2011, two of the gas utilities opted out of procuring the synthetic gas, leaving the remaining two utilities with far greater purchase obligations. In response, the developers argued before the Illinois Commerce Commission that Ameren and Nicor customers should be paying for 95 percent of the costs of the facility, while only receiving 84 percent of its output. That is not a fair deal for ratepayers. We can do better,” Quinn’s message stated. “In addition, our country is in the midst of a natural gas boom, which is coupled with dramatically decreasing demand. As a result, current natural gas prices are at historic lows, and many indicators suggest prices will remain low for years to come. These new facts require further scrutiny, and a revisiting of the economics of this 30-year project. I support the Chicago Clean Energy project, but it must be implemented in a way that protects the consumers of Illinois.”

Proponents say there are no guarantees that natural gas prices will stay as low as they are now. They say having a consistent source of natural gas in the state for the next 30 years would help protect customers from volatility. “Prices fluctuate — gas station prices — and so do natural gas prices, as well,” Chicago Democratic Sen. Donne Trotter, who sponsored the legislation enabling the project, said in July. Hoyt Hudson, project manager of Chicago Clean Energy, wrote in guest column published in the State Journal-Register, “The Chicago Clean Energy project guarantees a predictable price in one of the nation’s most volatile commodity markets — natural gas — while creating thousands of jobs and providing consumers with clean energy.”

“After earning strong, bi-partisan support for this bill from the Illinois House and Senate, and having enjoyed support from communities throughout Illinois, we are deeply disappointed in the governor's decision,” said a prepared statement from Chicago Clean Energy. “We know that this $3 billion investment in Illinois was good for the state's economy, its environment, its workers and its consumers. While we find the governor's decision unfortunate, we look forward to continuing our work at our other facilities throughout the country."

 Trotter and Hudson could not be reached for comment.