Friday, April 27, 2007

“Bingo-bango” legislative roundup

A lot of drama and legislation zipped through the Capitol this week, so Deanese and I compiled a quick list of interesting action in addition to the stuff we wrote about earlier this week:

Sen. Gary Forby’s proposed minimum one-year electricity rate freeze for Ameren Illinois customers won approval from a House committee, but it’s not expected to offer relief to customers anywhere in the state any time soon. At the wishes of House Speaker Michael Madigan, Democrats changed it to include Commonwealth Edison and effectively denied the wishes Senate President Emil Jones Jr. Republican Rep. Bill Black of Danville, the original House sponsor who was legislatively shoved aside by House Democrats, said he reached the limits of his frustration. “We’re tired of this tennis game between the president of the Senate and the speaker of the House, two intelligent and highly respected men in this process. The tennis ball that they’re using are my constituents’ heads, and I’m just a little tired of it,” he said after committee. “Who do these people think they’re fooling? They aren’t fooling my constituents. They know what’s going on: Bingo, bango, bingo, bango, and they don’t get any relief.” (SB 1592)

Rep. John Fritchey’s legislation banning some pay-to-play campaign contributions won House approval. It would prohibit state employees from getting perks from potential contractors. And people seeking state contracts worth more than $10,000 would have to report their campaign contribution history. Legal, banking and consulting fees also would be prohibited. (HB 1)

Rep. Lou Lang’s gaming measure to create four new casinos in the Chicago area and add slot machines at racetracks won approval from a House committee. It also would create 37,000 more gaming positions in the state and generate $1.3 billion to $3 billion a year. (HB 480)

Sen. Terry Link’s statewide smoking ban, already approved by the Senate, moved out of a House committee with no amendments. It could be called for a vote by the full chamber this afternoon. (SB 500)

Rep. Anazette Collins’ measure to lower the age nonviolent offenders can be tried as juveniles won House approval. While 18-year-olds would be still be tried as adults, 17 year-old nonviolent offenders would be tried as juveniles so, the sponsor said, they could reform themselves without having an adult criminal record and without serving in an adult prison. (HB 1517)

Rep. John Fritchey’s parental notification measure for minors seeking an abortion failed the House. It would have required minor women to talk to an adult, other than clergy or adult siblings, before terminating a pregnancy. During House floor debate, Fritchey said it was the hardest and most frustrating piece of legislation he’s had to do. (HB 317)

Rep. Harry Osterman and Rep. Deborah Graham’s gun control measures stalled in the House. One measure would require background checks at every level of sale, and the other would require licensing for people who wanted to sell their guns. (HB 758 and HB 796)

Thursday, April 26, 2007

Update on hospital assessments

A House committee approved a so-called supplemental budget Wednesday afternoon that would give the Illinois Department of Healthcare and Family Services the authority to distribute $2.4 billion in federal funds over two fiscal years to reimburse health care providers who care for Medicaid patients. (See page 63 of the bill.)

Along with the department’s spending authority for the “hospital assessment” program, the budget also includes more than $1.4 million for legislators’ 9.5 percent pay raises (page 36 of the bill) recommended by the Compensation Review Board’s 2006 report. There’s also $7.7 million for families of veterans who passed away in the line of duty in the Middle East (first page of the bill).

The supplemental budget bill still has to get approval by the full House and the full Senate before going to the governor.

UPDATE: More political maneuvering resulted in the House Democrats, as expected, reinserting Commonwealth Edison back into Sen. Gary Forby’s legislation aimed at offering one year of relief for Illinois’ electricity customers (see our April 20 blog below). The full House still has to vote on the measure before it goes back to the Senate, where it’s expected to either stall or fail.

NOTE: I’m still waiting for an official response from the Department of Healthcare and Family Services regarding the Medicaid bills and the hospital assessment program.

Wednesday, April 25, 2007

Missed opportunity

The Illinois comptroller’s office says the state missed the boat in early April to do three things at once: 1) reduce its backlogged Medicaid bills by half, 2) activate the second half of a program that distributes federal dollars to hospitals that care for Medicaid patients, and 3) repay a $900 million loan that kick-started that program. Statehouse reporter Doug Finke wrote about it in Wednesdays’ State Journal-Register. I talked to Carol Knowles, spokeswoman for Comptroller Dan Hynes, Wednesday morning.

About $747 million in federal Medicaid funds are sitting unused until the Department of Healthcare and Family Services gets legislative approval to spend that money, according to Keith Taylor, Hynes’ chief of staff. He said in an April 4 letter to the department director Barry Maram that the federal money could be tapped to pay $650 million of the state’s backlogged Medicaid bills due to health care providers. But the comptroller can’t pay those Medicaid bills without the department submitting the invoices to Hynes’ office. Taylor’s letter said the department was holding more than $1 billion in Medicaid obligations.

“We can’t pay bills that they haven’t sent to us,” Knowles said. “It’s difficult when you’re sitting on more than $1 billion worth of bills everyday and you can’t bring that down. And that, in the end, winds up costing the state more money in interest. Why would they want to do that?”

Department spokeswoman Amy Rosenband wasn’t able to call me back before this post and before I head off to committee meetings, so I’ll add her response once I get it.

In a follow-up letter April 24, Taylor said the comptroller’s office was “extremely disappointed” that the department didn’t respond to the request. The timing was sensitive given the June 7 deadline for the state to repay its $900 million loan. The General Assembly also still has time to approve the spending authority needed to start the second year of the hospital assessment program. In fact, I’ll be in a House committee this afternoon that is expected to discuss a supplemental budget, which would give the spending authority needed for the program.

Tuesday, April 24, 2007

The Golden Rule exemption

Deanese Williams-Harris offered the following observation:
On stage, Gov. Rod Blagojevich repeatedly campaigns for his health care initiatives as following the Biblical Golden Rule: Do unto others as you would have them do unto you. Behind the stage, however, the governor uses a different approach, particularly when in Springfield.

He took the stage at Springfield’s Prairie Capital Convention Center Tuesday afternoon, speaking to a crowd of Illinois’ nurses to promote his Illinois Covered health insurance plan for all adults. He said “powerful forces” attack the way he plans to fund the program and accused the opposition of “having friends in high places” and “wanting to keep the system as it is.”

Once off stage, the governor briefly stopped to take pictures with some supporters. But a scene erupted when reporters approached the governor to ask questions, and things escalated when two of the governor’s security detail grabbed a newspaper reporter by both of his arms. The reporter called out, “Governor, do you see what your goons are doing to me?” and demanded the guards take their arms off of him.

Blagojevich, who clearly had no intentions of addressing the media after the event, flashed a deer-in-the-headlights look as other reporters started shouting out questions. He was in such a hurry to get into his black SUV that he closed the car door in Sen. Carol Ronen’s face before the Chicago Democrat could hop in. She started knocking on the window. The governor’s entourage finally let her in before driving off, but not before another reporter prompted the governor to at least put on his seatbelt.

Chicago PEOPLE in the news
Ron Huberman is the new board president of the Chicago Transit Authority, as recommended by Chicago Mayor Richard Daley. Huberman replaces Frank Kruesi, who resigned after more than nine years as the agency’s chief executive officer and shortly after the agency asked the General Assembly for billions of dollars.

In a March report, Auditor General William Holland’s office said the Chicago Transit Authority joins the Regional Transportation Authority, Metra and Pace in “facing a serious financial shortfall,” and it doesn’t bring in enough revenue to cover current operations and replacement of aging buses and rail cars. The report also said the CTA’s retirement plan is “severely underfunded and its condition is worsening” and that the whole mass transit system needs an overhaul.

The Chicago Transit Authority wholeheartedly agreed and backed a campaign for the state legislature to help pay for a five-year plan needing $10 billion in new capital funding and $400 million more a year for operating costs.

Huberman served the past two years as Daley’s chief of staff, and he previously served as executive director of the city’s Office of Emergency Management and Communications. The mayor’s new chief of staff is Lori Healey, the city’s former planning and development coordinator. She previously chaired the Chicago Housing Authority and became the first deputy commissioner of the city’s tax increment financing program (see our Q&A with her in Illinois Issues, October 2006, p. 40).

Friday, April 20, 2007

This week at the state Capitol

This week’s events provided little evidence of how things will play out before the state legislature reaches its constitutional deadline of May 31, but some Statehouse scenes throughout the week could hint at the status of the governor’s policy proposals (education, health care and a tax overhaul) and high electricity rates.

Education committee: well organized
There was an obvious elephant in the room when a Senate committee held a hearing about the governor’s education plan. The Senate Democrats gave a nice advanced notice about the hearing with a printed list of witnesses to testify, printed testimonies available to the press and everything. All testified in support of the educational policy side, but the committee chair intended to keep discussions from bleeding into the more controversial funding source, the gross receipts tax. Meanwhile, most of the room was packed with people who opposed the new business tax, and they got rowdy when Senate President Emil Jones Jr. tried to say the gross receipts tax was the most fair way of actively doing something about education reform. However, as hard as the administration tries to portray a positive message about the tax and education plan, the fear of the unknown in the GRT really does create skeptics among legislative members of both parties.

Health care committee: We want details
Deanese Williams-Harris contributed this portion
Senators want to see the rules to the governor’s new subsidized insurance plan in writing.

“You’re asking us to raise $2.1 billion in taxes for a plan we can’t identify,” said Sen. Mike Jacobs, a Democrat from East Moline. “If I don't know the rules, I can’t vote for it.”

Larry Barry, president of the Illinois Life Insurance Council, agreed, calling the initiative generic in nature. “Put in the bill what you want done. That’s all I’m asking,” he said. He also voiced concern that insurance companies would have to wait for the state to reimburse them for insuring people who were subsidized by the state, but the legislators would have to approve money in the next state budget for those reimbursements to be possible.

The gross receipts tax also would be the main funding source for Illinois Covered. “What happens if [GRT] fails?” said Sen. Dale Righter, a Mattoon Republican.

“GRT is a comprehensive package,” responded Anne Marie Murphy, Medicaid director and the governor’s health care policy advisor. “We have to see all of these [proposals] as a package.” She also said the rules would be put in writing before the measure is called for a vote.

Tax overhaul: Jones vs. Meeks
President Emil Jones and Sen. James Meeks didn’t exactly whisper when they were going back and forth about the gross receipts tax as a Senate committee heard testimony. At one point, Jones leaned back in his chair towards Meeks, who was sitting behind him, and said, “We are for the gross receipts tax, not taxing individuals.” Meeks is sponsoring alternative tax reform that would raise income and sales taxes and is designed to relieve property taxes. The measure, House Bill and Senate Bill 750, has potential to take some Democratic and Republican votes away from the governor’s gross receipts tax supported by the Senate president. Considering Meeks played chicken with the governor this summer by threatening a gubernatorial run if Blagojevich didn’t promise significantly more money for education, it’s safe to say Meeks has used his political leverage before.

Electricity rates: Procedural maneuvering
The full Senate approved a one-year rate freeze for downstate Ameren Illinois electricity customers, but they excluded Commonwealth Edison that serves northern Illinois. Procedural maneuvering allowed Senate members to cast a vote to include ComEd knowing full well it wouldn’t make it into the final legislation. Sponsor Sen. Gary Forby got a political slap in the face. The Benton Democrat has gotten a lot of angry phone calls from his southern Illinois constituents who really can’t afford their electricity bills, but he worked hard to get ComEd’s northern Illinois customers in the freeze, too. After ComEd was stripped from the legislation, Forby said he was completely surprised and disappointed. In fact, as many angered Democrats and Republicans pointed out during floor debate, the bill is expected to go to the House, where Speaker Michael Madigan is likely to favor a freeze that includes ComEd. Adding an amendment to include ComEd also would give House members a chance to go on the record as supporting a comprehensive freeze. The amended measure would then be sent back to the Senate (because both chambers have to approve the exact same wording before it’s sent to the governor), but the Emil Jones is unlikely to allow a freeze to impact ComEd, a large supporter of the Senate president. Sen. Chris Lauzen, an Aurora Republican, called it a “premeditated, parliamentary scheme.” Sen. Dale Risinger of Peoria told the chamber he wanted to go home and shower.

Tuesday, April 17, 2007

GRT or nothing?

If Gov. Rod Blagojevich’s revenue idea to create a gross receipts tax fails to get legislative approval this spring (or summer), the governor is willing to consider other revenue sources, according to John Filan, Blagojevich’s former budget director and current chief operating officer.

“He won’t support an income and sales tax increase, but there are other aspects of the budget, other revenues he’d take a look at,” Filan said Monday after a budget-related conference in Springfield. But the administration is determined to keep the gross receipts tax as its primary revenue source, with some flexibility in tweaking it. “We think the gross receipts tax is the kind of tax that can generate that kind of money without disrupting large parts of the economy with smaller tax bases like an income tax or, especially, a sales tax does.”

He and budget director Ginger Ostro joined a panel of policy experts on taxes, education funding and business at “A Budget on the Brink” conference at the Springfield Hilton Monday. (Find more information about “A Budget on the Brink” here.) There was a lot of back-and-forth and repeated allegations of people citing facts based on assumptions rather than on transparent numbers. But the panels also posed a few good questions: 1) Does the state truly need more money to spend? If so, then how can the state fairly restructure its tax code? And 2) If the state needs to control spending as business groups advise, then what can the state and state agencies cut out?

Blagojevich’s $10 billion investment in education over four years wouldn’t fly without a revenue source as big as the $7 billion expected from GRT. Because the governor already ruled out increases in income or sales taxes proposed in HB 750 (see our March 20 blog), what else is on the table that would generate as much revenue as the GRT?

  • Leasing the Illinois Lottery: at least $10 billion, but the governor already earmarked that for pension funding
  • Leasing the Illinois Tollway: anywhere from $1 billion to more than $20 billion, but that hasn’t gone anywhere this session
  • Selling a larger chunk of the state’s student loan portfolio: a $4 billion asset, but legislators urge that money only be used for higher education
  • Opening four new Chicago-area casinos with expanded gaming statewide: between $2 billion and $3.5 billion a year. HB 480, proposed by Rep. Lou Lang of Skokie, wasn’t mentioned by the governor and is stalled in negotiations
  • A combination of all of the above

And what about the near-universal health care plan that would cost about $2.1 billion annually by the time it’s fully implementation in 2010? The governor could still secure the $1.1 billion generated by a payroll tax on businesses that don’t offer comprehensive health benefits. But he’d also need some other form of revenue or federal funds.

Thursday, April 12, 2007

Ethical dilemmas

Deanese Williams-Harris wrote the following post.

The results of a recent state employee ethics survey paint a gloomy picture of the environment in state offices. The survey, conducted by the Illinois Executive Ethics Commission, surveyed 402 random employees.

Employees reported ethical concerns with leadership roles and with how ethics investigations are carried out. As it stands, investigator general reports are not made public.

"Because the Ethics Act requires complete secrecy about investigation into wrongdoing, employees are not convinced that wrongdoers face any consequences," says Chad Fornoff, executive director of the commission.

Furthermore, an overwhelming majority report ethic rules weren't being fairly enforced, and many say they're uneasy about reporting unethical behavior. "The bad news is many employees believe agency ethics programs are ineffectual and fear retaliation if they report unethical activity," he says.

Eighty-seven percent of those surveyed identified one or more elements in the workplace that lend themselves to an unhealthy climate. More than 45 percent of employees say senior officials in their departments are less likely to be disciplined for wrongdoing than other employees.

Fornoff says the lack of trust reported by employees shows the need for transparency in the investigation and disciplinary process. "We believe that a pending bill that we have been supporting, SB157, will alleviate this problem." If approved, the measure would make public all alleged violations, the history of those violations and recommended disciplinary action against the state employees.

Natural Selection
A report released by the Illinois auditor general says the state Department of Natural Resources showed favoritism to certain hunters in issuing administratively approved hunting permits. The department also exceeded hunting quotas stipulated by Illinois law.

More than 1,200 permits were given out by administrative approval. The special permits benefited Illinois Conservation Foundation donors, professional athletes, judges, politicians and five representatives of an ammunition company.

The process allows hunters to bypass the hunting permit lottery system. However, the process wasn't open to the public. According to the report, fewer permits were available to Illinois hunters because of the number of special permits issued before and after the lottery process.

More than 90 percent of the applications for the special permits were incomplete, and fees weren't paid for more than 20 percent of the permits.

As a result, the department was asked to establish policies and procedures for issuing administratively approved permits. The department agreed to the recommendations.

For a quick synopsis of the violations, log on to the auditor general's findings.