By Jamey Dunn
The Illinois Department of Transportation’s new multi-year construction plan seeks to assess the state's infrastructure across all modes of transportation.
The proposal is for Fiscal Year 2013 through Fiscal Year 2018, and it considers not only roads and bridges but airports and rail routes, including transit and freight rail. “It provides more balance and growth to an already vibrant transportation network in Illinois,” said Illinois Transportation Secretary Ann Schneider. The plan calls for $9.2 billion in spending. The last of the capital bill funding, $1.2 billion would be pooled with $6.5 billion in federal funding, $2.2 billion in state funds and $454 million in local funds to pay for the program. In FY 2013, $1.8 billion would be spent. The plan calls for work to 2,302 miles of roads and replacement or repairs to 508 bridges. According to IDOT, the construction plant would create or sustain 120,000 jobs between FY 2013 and FY 2018.
IDOT's plan also focuses on sustainability and information technology. Under the plan, 1,000 miles of fiber optic cables would be installed and upgraded along state and local highways. According to the proposal, IDOT worked to install 3,100 miles of fiber optic cable between 2010 and 2012.
While releasing the construction plan, IDOT also made a pitch for Gov. Pat Quinn’s plans to revamp the state’s Medicaid and pension systems. “To ensure the continuation of the state's capital plan and projects like these, which are putting hundreds of thousands of Illinois residents back to work, Governor Quinn has proposed necessary changes to stabilize and restructure the state's pension and Medicaid programs after decades of fiscal mismanagement,” said an IDOT news release announcing the construction plan. “These changes will lead to greater certainty in Illinois' business climate and help respond to serious concerns from the ratings' agencies. The billions of dollars saved through these reforms are key to the state's ability to ensure that critical capital improvement and road safety projects in Illinois are able to move forward.”
Schneider said that savings from both proposals would free up money that could potentially be spent on capital projects. She said that failure to address the two issues could result in a drop to the state's credit rating. Capital construction projects are funded with borrowed money, so Schneider said a drop to the state's credit rating, which can lead to higher interest rates on borrowing, could cut into IDOT's plans. “So if the interest rates go higher and more of that money is dedicated to debt service, then that’s less for projects.”
Go to IDOT's website to see a map of projects planned across the state.
Monday, April 30, 2012
By Jamey Dunn
Sunday, April 29, 2012
Saturday, April 28, 2012
Friday, April 27, 2012
Thursday, April 26, 2012
By Ashley Griffin
As lawmakers look to cut the state budget, law enforcement officials warn that reductions to early childhood programs are false savings because they create a need for more spending in other areas.
A report released Thursday by a group called Fight Crime: Invest in Kids Illinois, a non-profit anti-crime organization led by more than 300 law enforcement officials, found that cuts to state preschool programs could cost the state more in the long run, in part because students who do not receive a preschool education are more likely to end up in the back of police car. The report states: “Fight Crime: Invest in Kids estimates that cutting preschool for 176,000 children will cost the Illinois taxpayers $200 million over the children’s lifetime due to increased criminal, educational and social services for at-risk children denied preschool. This future cost of $200 million from denying preschool for the 17,600 children who have been cut is more than three times greater than the $55 million we save now. Even in tight fiscal times, preschool is an excellent investment that must be preserved.”
According to the report, Illinois has over the last three years cut funding for preschool for all by $55 million and denied 17,600 children the chance to attend publicly funded preschool programs. “The data bears out that when children have good quality preschool programs, in the long run it improves their odds of succeeding in life and avoiding the criminal justice system,” said Tyler Edmonds, a state's attorney in Union County. “We want to make clear to our state legislators and our governor that the investment on the front end and in these programs is going to save the state and local governments time and money in the long run.”
Instead of cutting some early childhood education programs, the report recommends that lawmakers reject the proposed $85 million in programmatic cuts for the child care assistance program for working families, support the proposed Fiscal Year 2013 funding levels of $345 million for the Early Childhood Block Grant and provide all families access to early learning programs. “I can’t stand in the shoes of our legislators, and I know that they and the governor have a herculean task of trying to find places where cuts can come from,” said Thomas Gibbons, Madison County state's attorney. “What I can say is that when it comes to kids, kids should be safe. We need to do everything we can to protect them and provide for them and that they [legislators] are going to have to look elsewhere. I know there are going to be tough choices that have to be made, but I think children need to be off the table because we cannot leave our kids behind.”
Gov. Pat Quinn called for more spending on early childhood education programs this year, but he has called for cuts in the past. “I believe in the power of education to create opportunity for everyone in our society. This is why I have maintained our basic investment in education, despite extremely hard times,” Quinn told lawmakers in his budget address. “No state is going to out-educate Illinois. I believe in early childhood education, special education, bilingual education, kindergarten-to-12th-grade education, community college education and university education.”
While lawmakers are still weeks from making final spending decisions, education cuts are a distinct possibility. The House passed a resolution that calls for spending reductions in virtually all areas of government. Rep Will Davis, chair of the House budgeting committee for education, said all areas of spending would be up for consideration. Davis, a Homewood Democrat, urged the House to consider new revenue before cutting spending. When his pleas were shot down, he warned that the proposed cuts his committee will have to produce would be painful. “They’re not going to like what’s going to come out of my committee. It’s not going to be pretty. In my committee, everything will be on the table.”
By Jamey Dunn
A measure to regulate a drilling process commonly referred to as “fracking” passed in the Senate with no opposition today.
Hydraulic fracturing, also known as fracking, is a process used to extract oil and gas by pumping water, chemicals and sand into the ground. The water fractures a source rock, allowing gas or oil to escape and be collected. Sand is used to hold the cracks in the rock open. Chemicals are added to the water for a variety of reasons, such as disinfection, lubrication and making the water thicker to keep the sand from sinking.
The primary controversy over fracking has been issues of water pollution. In Dimock, Pa, residents near fracking sites say their water has been contaminated and has made them sick. Preliminary tests by the U.S. Environmental Protection Agency did find some chemicals in residents’ drinking water but did not find any at levels unsafe for human consumption and could not positively link any contaminants to fracking. Residents in other states near fracking sites have had similar complaints, but the EPA has yet to produce a conclusive link between fracking and toxic water pollution. Proponents of fracking claim that the water is pumped into the ground far below drinking water reservoirs and cannot come in contact with drinking water. Surface spills of water used in the process are also a concern.
Pennsylvania officials say that some methane released during the drilling of fracking wells did migrate to private water wells near Dimock. Methane is not toxic, but it does present a safety hazard because it is highly combustible. Multiple studies conducted by local governments have found elevated levels of air pollution near fracking wells.
Franking has been practiced on oil wells in Illinois for decades, but a new interest has grown around the potential for extracting natural gas in southern Illinois. Such fracking projects would likely be on a much larger scale than anything Illinois has seen to date. Sen. John Jones, a sponsor of Senate Bill 3280 who has worked in the oil industry, said that he has participated in the fracking more than 500 oil wells over the last 30 years. Jones, a Mt. Vernon Republican, noted that there has never been a fracking accident in Illinois.
Out-of-state energy companies have begun leasing mineral rights in southeastern Illinois, sometimes paying double or triple the historical prices for mineral rights in the area. So far, interest has been mainly focused in Wayne, Hamilton and Saline counties
The legislation would require drillers to met certain standards for protective casing built into fracking wells. They would also have to disclose the chemicals they use. Companies would be required to tell the state Department of Natural Resources how much water they use and how they plan to dispose of fracking waste water. The bill is backed by the industry, as well as environmental groups such as the Sierra Club. “This is the product of several months of negotiations,” said Champaign Democrat Sen. Michael Frerichs, a sponsor of SB 3280. Frerichs and Jones were the only two speakers during a floor debate of the bill today.
Terri Treacy, a conservation field representative for the Illinois chapter of the Sierra Club, said that chemical disclosure would give residents living near fracking wells a chance at recourse if their water became contaminated. She said her group did not push for a ban on fracking because it did not seem like a political reality. “Bluntly, we feel like legislation to make it safer at this stage is more likely than getting a ban,” she said. The National Farmers Union in Canada has called for a moratorium on fracking in Canada. Several New York municipalities have banned the practice, and New York State is considering a moratorium.
“The environmental groups that we have dealt with are not antidevelopment groups,” said Brad Richards, executive vice president of the Illinois Oil & Gas Association. “They just want to make sure that the ground water is protected.” Richards said that fracking has been done responsibly in the state for decades, and the industry as a whole has embraced disclosing the chemicals used.
Richards said that fracking could bring economic development and jobs to parts of the state that face high unemployment rates and have been hard hit by the recent economic downturn. But he said drillers will have to work to be good neighbors, and local communities should consider the cons, such as additional wear and tear on roads and other infrastructure. “We are sometimes kind of given an either/or: ‘Do you want economic development? Do you want oil and gas development, or do you want to protect the environment?’” Richards said. “It’s not an either/or. We can have both, and I just absolutely reject the notion that you can’t.”
But some in southern Illinois still hope to keep new fracking endeavors out of their area. Liz Patula, coordinator of Southern Illinoisans Against Fracturing Our Environment (SAFE), said that the potential risks of fracking are too big to consider for an uncertain economic payoff. She said she is worried about the long term impact if water or land becomes polluted during the process. “You’re talking about a few jobs, and the price for that is literally destroying the region and the land base.” Patula’s group is reaching out to farmers in southern Illinois and trying to rally a grassroots opposition to fracking.
Drilling is expected to begin in the next few months. For a comprehensive look at hydraulic fracturing and what it could mean for Illinois, see the upcoming May edition of Illinois Issues.
By Jamey Dunn
A committee tasked with determining whether there is cause to discipline a lawmaker accused of bribery has hit a wall in terms of evidence that is available for its investigation.
Rep. Derrick Smith, a Chicago Democrat, was arrested on bribery charges in March. Prosecutors allege that Smith accepted a $7,000 bribe for recommending a day care for a construction grant. Smith was the subject of a federal sting, so the day care was not actually seeking the grant. Smith has since been indicted on a bribery charge. The indictment said that $4,500 of the alleged bribe money has not been recovered.
A House Special Investigation Committee voted today to request Smith to testify before the panel under oath. The committee must decide whether the House should pursue disciplinary action against Smith. The move came after United States Attorney Patrick Fitzgerald told the committee that his office would not share evidence with the committee. Fitzgerald said the committee cannot seek information through subpoena or requests under the Freedom of Information Act without potentially causing harm to criminal investigations. “I can tell you that our investigation of Representative Smith is continuing, and it is our strongly held belief that any disclosure of the government’s evidence or active inquiry conducted by the committee into the allegations of the federal indictment will likely interfere with our pending case and ongoing investigations,” a letter from Fitzgerald to the committee stated.
Rep. Elaine Nekritz, the chair of committee, said Fitzgerald’s response was not entirely unexpected. “The committee's hands are, I think, significantly tied by the criminal proceeding. … I’m not surprised that they didn’t turn over evidence to us. I’m frankly not surprised that they would say, ‘Don’t do your own investigation.’ But that does really limit what we can do.”
Nekritz said one option left to the group would be to go directly to Smith. The committee opted to send Smith a letter requesting his testimony instead of issuing a subpoena, but Nekritz said that either option would have the same result. Even if subpoenaed, Smith could opt not to testify based on his Fifth Amendment rights, which protect against self-incrimination. However, Nekritz said that if Smith decides not to testify, the committee could take that into consideration when deciding if there is enough evidence to seek a disciplinary action against him. In criminal court, if a defendant invokes Fifth Amendment rights, it cannot be used against him or her.
Smith did not appear at today’s hearing or any of the previous meetings of the committee. He has returned to work in Springfield, but he has declined to answer questions from the press. A call to his lawyer was not returned.
Nekritz said Smith is expected to enter a plea next week, and the committee wants to see if any new information or documents come out of the court proceedings. “I think it behooves us as we go through this to get as much evidence as we can," Nekritz said. She said the committee does not have to wait until the end of criminal proceedings to make a recommendation to the House, but for now, she would like to wait and see if the committee can get more to go on in the coming weeks.
If the committee recommends disciplinary action, the full House could vote to censure or expel Smith. “In the short run, we would like to see what could become available through the court filings and what the U.S. attorney does through the [evidence] discovery process,’ Nekritz said. “Unfortunately, I have a very short-term view of this now, and it’s very hard to predict months out how that’s all going to play out because it could dramatically change next week.” She said she expects the group to hold another hearing in the next two weeks.
Wednesday, April 25, 2012
By Ashley Griffin
Advocacy groups have begun their push back against Gov. Quinn’s proposed Medicaid cuts.
A new report released by the Campaign for Better Health Care and Families USA — both nonprofit health care advocacy organizations — claims that the proposed cuts by Quinn would not only hurt some of Illinois’ most vulnerable citizens, but the cuts would also have a drastic impact on the state’s economy.
“If Medicaid is cut, it would not lessen the number of people who will be needing health care, and it would not lessen the number of people who will be utilizing health care,” said Jim Duffett, executive director the Campaign for Better Health Care.
Last week, Quinn proposed a plan to defer $2.7 billion in Medicaid growth. His proposal would cut $1.35 billion by eliminating or reducing services and finding efficiencies. Health care providers would also take a $675 million hit in rate reductions for the services they provide under the program.
The report states: “Cutting Medicaid can generate some short-term savings, but there is a cost. There is a cost in terms of unmet medical need and increased sickness for those who lose coverage. There is a cost to children who, lacking medical care, fall behind in school. There is an economic cost in terms of lost jobs and reduced business activity.”
The report found that an 18 percent cut, the total reduction in Medicaid spending the group says Quinn is proposing, would put more than 25,000 jobs at risk. The group said Quinn’s proposal would also result in $3.2 billion lost in business activity statewide.
“These are real people, real jobs, real patients, real communities that are tremendously facing harm. The cuts of the magnitude that are being proposed, we estimate roughly an 8 percent across the board [to providers], is really just way too far, what we are trying to do in filling up a $2.7 billion spending gap is unprecedented in its size and scale, and we really need to appreciate the type of impact that level of cuts is going to have, not only on the economy but on real people,” Maryjane Wurth, president & CEO of the Illinois Hospital Association, said at a news conference highlighting the report.
Instead of proposed cuts, such as the elimination of adult dental care and Illinois Care Rx, a prescription drug program that helps low-income seniors pay for their medicine, the groups advocate expanding coordinated care in the Medicaid program to improve access. The groups also support the idea of creating more programs that could possibly get matching dollars from the federal government.
“Hospitals are working very hard on moving to integrated care, care coordination, so that people get the right care at the right time with the right outcomes with the lowest cost. We should be investing — we need to be maximizing federal revenue to the state. Right now, for every dollar that is cut in Medicaid, we simply hand back a dollar to the federal government. This is a time when, in the Illinois challenge, that we should be maximizing every single legitimate dollar that this state can achieve,” said Wurth.
But Quinn believes the cuts are necessary for the state to catch up on its backlog of Medicaid bills. Quinn said the growing stack of unpaid Medicaid bills — which he says would reach $4.6 billion by the end of Fiscal Year 2013 if no action is taken — makes reductions in the program necessary. He said those in opposition to his proposals are ignoring that reality.
“We have to save the system in order to have a system. It is on the verge of collapse,” Quinn told the editorial board of the Springfield State Journal-Register today. Quinn said he is open to negotiating Medicaid changes as long as they would result in a $2.7 billion reduction in liability for next fiscal year.
However, Quinn said that the goal cannot be reached solely by removing Medicaid patients who are on the rolls but not eligible. Proposals from organizations representing hospitals have relied heavily on that tactic as a means to cut Medicaid costs, but Quinn said he thinks their savings estimates are off. “I think there’s a few numbers that are just drawn out of the air here,” Quinn said. “We don’t think they’re correct. We think they’re fanciful numbers.’
But the one thing Quinn and many advocates agree on is a $1-a-pack cigarette tax increase to avoid some cuts. Quinn estimates the proposed increase would bring in $337.5 million, plus another $337.5 million in federal matching funds.
“We didn’t get into this hole overnight. It took years to get here; it will take more than one year to get out. By considering such common sense revenue solutions, for example, such as a cigarette tax, we would be well on our way on beginning to raise the revenue that is needed to go against these cuts,” said William McNary, co-director of the Citizen Action Illinois, an advocacy group that joined social services organizations to protest Quinn’s proposal at the Statehouse today.
However, Republicans have come out hard against the cigarette tax plan. Quinn said he would work to lobby lawmakers on the idea.
“I would hope that both [chambers] don’t have some sort of caucus position against doing something that’s in the best interest for the people — for their health [and] for investing in Medicaid,” Quinn said. “We’ll be talking to member of the legislature and reminding people of how they voted [on cigarette tax increases] in the past.”
Tuesday, April 24, 2012
Monday, April 23, 2012
Sunday, April 22, 2012
Saturday, April 21, 2012
Friday, April 20, 2012
By Jamey Dunn
Under a plan Gov. Pat Quinn laid out today to reform the state pension system, workers would have to choose between retiring later and paying more for benefits or giving up state subsidized retiree health care coverage and not having any future pay increases figured into their pension benefits.
While Quinn acknowledged that the primary cause of the state’s $83 billion pension liability was governors and lawmakers failing to make the needed contributions in the past, he said today that benefits must be scaled back to ensure the future integrity of the state’s retirement systems. “I know I was put on Earth to get this done,” Quinn said at a Chicago news conference.
He added, “I really expect the legislature to rise to the occasion here.”
Under Quinn’s plan, employees of state government; public colleges, universities and local schools; and legislators would have to pay 3 percent more of their salaries into the pension systems. They also would not be eligible for full retirement benefits until age 67. Currently, contribution levels and retirement ages vary from system to system. Under Quinn’s plan, teachers would go from paying 9.4 percent of their salaries to 12.4 percent. University workers would see their contributions rise from 8 percent of their salary to 11 percent. Currently, many state employees can retire at age 60, but the number of years spent on the job also goes into determining retirement age and level of benefits. Quinn said the change in retirement age would be phased in but did not give details on how that would work. Quinn's plan would not affect judges, who also belong to a state retirement system, or currently retired state employees, according to Brooke Anderson, a spokeswoman for the governor.
Cost of living increases for future retirees also would be reduced. Retirees now receive an annual compounded 3 percent cost of living increase. Quinn’s plan calls for future retirees to get an annual increase of 3 percent or half of the federal Consumer Price Index, whichever is less. The cost of living increase also would not be compounded over time and would not kick in until a retiree reaches 67 or has been retired for five years, whichever comes first. Anderson said current retirees would not be affected by Quinn's proposed changes to the cost of living increases.
Quinn also said he supports shifting some costs to local school districts and state community colleges and universities, but he said that component of the plan is still a work in progress. “I think that this is a principle of accountability that everybody understands that those that are negotiating [employee contracts] should have skin in the game,” Quinn said.
He said his proposal would produce $65 billion to $85 billion in savings, not including savings produced by shifting some pension costs to local schools and state universities and colleges. He also said that by 2042, the state would commit to 100 percent funding for the pension systems, eliminating its current $83 billion pension liability. The target under current statute is for the pension systems to be 90 percent funded by 2045, meaning that they would have about 90 percent of the money needed to pay the projected future benefits of all employees in the systems. According to the United State Government Accountability Office, funding levels of 80 percent or more are considered “sound” for government pensions. The state pension systems overall are now about 43 percent funded. The funding formula, including a requirement that the state must fund the systems in the future, would be enacted into state law, Quinn said.
Quinn said individual state employees could choose not to go along with his proposal, but if they did, they would lose their state subsidized retirement health care, and any pay increases they earned after the plan was in place would not count toward their pension benefits. “Well, you can’t have both. You can’t have the current retirement plan and have the state of Illinois subsidize your health care in retirement,” Quinn said. “The state in the past has done both, and we can no longer afford to do both.”
Quinn added, “The other thing that employees will have is the assurance that the state will make the payments over the next 30 years.” He said he expects about two thirds of employees to opt for the benefit reductions over losing health care coverage.
It is this choice that Quinn and others say allows the plan to adhere to a state constitutional requirement that pension benefits cannot be unilaterally reduced. “I do believe it is constitutional. … There is an opportunity here for each person who is in the retirement system to make a choice. We are offering some consideration to them,” Quinn said. ‘We are not under a constitutional obligation to offer subsidies for those who are retired with respect to their health care.”
Senate President John Cullerton has argued that benefits could not be reduced unless workers agreed to the reductions and received something of value in return. “Pension benefit rights can be changed if the General Assembly offers public employees something of real value and public employees agree to accept that offer. Illinois cannot simply welsh on its pension promises to public servants,” Cullerton said during a recent speech to the City Club of Chicago. Cullerton added: “Employees must have a real opportunity to accept or reject the General Assembly’s offer in order to pass constitutional muster. With that said, the General Assembly may build incentives to encourage employees to accept the offer.”
A statement from Cullerton's office in reaction to Quinn’s proposal would indicate that he thinks Quinn’s plan does just that: “While the proposal will need to be resolved through further discussions with stakeholders, Cullerton is pleased that the governor's proposal embraces the legal framework that will allow the state to control pension costs in a constitutional way.”
But union officials do not see it that way. “We strongly disagree with the proposals made today. Considering that the subject at hand is the ability of hundreds of thousands of Illinoisans to support themselves in retirement, we believe the proposals are insensitive and irresponsible,” Illinois AFL-CIO president Michael Carrigan said in a written statement on behalf of the We Are One coalition of unions. “By appearing to endorse these unfair and unconstitutional cuts, the governor has made the process of finding common ground much more difficult. Forcing public servants to choose between two sharply diminished pension plans is no choice at all. It is a clearly illegal attempt to solve the problem caused by past governors and the legislature solely on the backs of teachers, caregivers and other public workers.”
Teachers unions argue that such reductions would hurt recruitment efforts and deter people from entering the profession. “Today, Gov. Quinn announced a proposal to address the Illinois pension problem that will adversely impact many active [Illinois Education Association] members and make education a less attractive career,” said a written statement by the Illinois Education Association. Education officials have argued that keeping teachers working longer would cost the state more than $1 billion because senior teachers earn higher salaries than newer teachers.
Republican leaders responded positively to Quinn’s plan. “I think there’s some real good components in this,” House Minority Leader Tom Cross said at a Chicago news conference. “This will get the attention of employees who are worried about their pensions.” However, the Republican leaders said they could not support pushing costs to local entities such as school districts because they believe it would result in property tax increases. “The cost shift is not something we’re supportive of at this time. We have been clear on that from the get-go,” said Senate Minority Leader Christine Radogno. Democratic leaders have argued that it is only fair to expect downstate school districts to cover a larger chunk of their pension costs since Chicago pays for almost all of its teacher’s retirement system. “There are a number of other inequities in the funding systems, particularly in education. We need to reevaluate all of the equity issues,” Radogno said. “I think who funds the pensions, local or state, is a separate issue.”
Quinn’s recommendations come after a legislative working group was unable to reach an agreement on a proposal. However, group members said they would keep working on a plan. The governor had set a deadline of April 17 for the group to present ideas and said today that he believes he has to move forward. “There has to be something put forward by the governor that is a plan that can be enacted by a bipartisan majority of each [chamber].”
Cross said he want to make sure that any plan that is signed into law would have the best chance of surviving an inevitable court challenge. “I think at the end of the day, regardless of what we do, it’s going to end up in court," he said.
Thursday, April 19, 2012
By Ashley Griffin
After a group of legislators failed to agree on a plan to reduce Medicaid costs, Gov. Pat Quinn released his own proposal today.
Quinn’s plan to defer $2.7 billion in Medicaid growth calls for $1.35 billion in savings and a $675 million rate cut to health care providers. He is also proposing a $1-dollar-a-pack cigarette tax increase, which he says would bring in $337.5 million. If spent on Medicaid costs, that money would result in a $337.5 million match in federal funds.
In an effort to help mend the “broken” system, Quinn pitched a plan with more than 50 individual proposals, including services that could be reduced or terminated. The proposed plan emphasizes changes to utilization controls, which would limit how many times a patient could use a certain service or cap the cost of treatment he or she could receive.
Some of these changes would include:
- Limiting eyeglasses to one pair every two years.
- Limiting prescriptions to five per month for adults and children.
- Limiting diapers for adults and children to 200 a month. The current limit is 300.
- Capping coverage for physical therapy, occupational therapy, speech, language and hearing therapy.
Some so-called optional services would be eliminated. Adult dental care and the Illinois Care RX, which is a prescription drug program that helps low-income seniors pay for their medicine, are on the chopping block to be terminated. Both cuts are controversial, and if Quinn gets his way, approximately 180,000 seniors would be affected by the loss of the Illinois Care RX program. Adult dental care would affect 172,000 Illinoisans. Some experts believe eliminating services such as dental care can push costs to other, more costly areas of the budget. Quinn is also calling for the elimination of group therapy in nursing homes, podiatry services for patients who do not have diabetes and chiropractic care for adults.
The push to reduce Medicaid costs comes in wake of Quinn’s “rendezvous with reality” budget address in February, when he told lawmakers they could not go home until they pass comprehensive Medicaid reform and called on a Medicaid working group to help solve a $2.7 billion crisis — an amount Quinn says would carry over into 2014 if lawmakers do not act now. “We just can’t afford to [put off paying bills]. The system would implode, and it would eat up everything in state government,” Quinn said in a news conference. He cited recent Civic Federation projections that Medicaid spending could reach $21 billion in unpaid bills by 2017.
But rate cuts for health care providers and the proposed cigarette tax increase were nonstarters with Republican members of the Medicaid working group.
“His plan that you see here today does not reduce the Medicaid program by $2.7 billion. In fact, half of his program relies on a tax increase that will simply be used to fuel more spending and a near $700 million cut to Medicaid providers like hospitals and nursing homes, who already suffer from some of the lowest rates and the longest payment delays in the entire nation,” said Mattoon Republican Sen. Dale Righter, a member of the Medicaid working group. “And what’s so ironic and sad about that is that if you cut rates by near the measure of what the governor is talking about, fewer providers … will take part in the Medicaid program. The fewer providers there are, the less access there is for health care.”
Hospitals argue that they would take too large of a hit under Quinn’s proposal. “The Illinois Hospital Association (IHA) and the hospital community are deeply concerned about the governor’s Medicaid proposal calling for a major rate cut to hospitals of about $350 million, or approximately 8 percent. This proposed rate cut is in addition to about $150 million in other proposed reductions directly targeted at hospitals,” Danny Chun, vice president for corporate communications and marketing for the Illinois Hospital Association, said in a prepared statement. “While we commend the governor for taking some positive steps — including incorporating several of IHA’s savings alternatives — the proposal is still too drastic and too rash to impose on the state’s already fragile health care system. Simply engaging in a math exercise to fill a budget gap is the wrong approach that will hurt patients.”
But Quinn said Medicaid patients should not be asked to bear all the pain of cuts. “We have to ask our providers, those who are involved in the health care system, to tighten their belts, and we are doing that by asking them to make economies of $675 million,” Quinn said.
A cigarette tax increase has failed to pass in both chambers despite many recent attempts at reviving the idea. The Senate did approve an increase in 2009, but it was shot down in the House. But Quinn argued that the increase would bring in money and deter smoking, which would save future health care costs. Senate President John Cullerton has been a longtime backer of a cigarette tax increase. “It's good fiscal and health policy and it should be part of our Medicaid stabilization plan,” Rikeesha Phelon, a spokeswoman for Cullerton, said in a written statement.
Righter challenged Quinn to put his plan into legislation to be called for floor votes as early as next week. “And then we’ll find out whether or not the working group’s work is done,’ Righter said. “I have not taken a poll of the members of the General Assembly, but I suspect the working group would go back to work.” For now, the legislative group plans to continue its work and has a meeting scheduled for Tuesday.
By Jamey Dunn
Gov. Pat Quinn tasked two legislative groups to recommend fundamental changes to the state’s Medicaid and pension systems. Neither of those groups has produced a final plan, but the governor is pushing ahead with his own recommendations.
Quinn released his plan for reducing growth in the state’s Medicaid budget by the $2.7 billion he said is needed. The working group charged with finding the reductions said they were only able to come up with about $1.4 billion in cuts. Quinn’s plan calls for almost that much in savings and then adds on a rate cut to providers and a $1-a-pack cigarette tax increase to reach the $2.7 billion goal. Sen. Dale Righter, a member of the Medicaid working group, said that Quinn has “surrendered” on reaching his own goal because he is proposing raising new revenues instead of making more cuts. “While were still six weeks out from the end of session, the governor is waving the white flag and saying, ‘You know we’re really not going to change the system that much, and we’re going to go ahead and raise taxes.’”
A $1-a-pack cigarette tax increase has been pitched in recent years as a place to find new revenue for construction or to avoid deep unpopular cuts to areas such as in health care and education. A cigarette tax increase passed in the Senate in 2009 but failed to get the needed support in the House. Senate President John Cullerton is a vocal supporter of a tax increase on cigarettes. “Like the governor, Cullerton recognizes the imperative of increasing revenue to stabilize the Medicaid system,” Rikeesha Phelon, a Cullerton spokeswoman, said in a prepared statement. “By raising the cigarette tax, we would benefit from federal matching dollars, we could cut costs associated with tobacco related illnesses, and we discourage young people from smoking.”
Righter, a Republican from Mattoon, said the legislative group plans to continue its work and will meet next week. “The working group’s not done. This is not the working group’s plan. This is the governor’s plan. And we don’t view the goal as the governor said of $2.7 billion in reductions as a goal. It’s a mandate,” said Mattoon Republican Sen. Dale Righter. “This is what you have to do to save the program for the people in the sate who need it the most. And so we’re ready to go back to work beginning Tuesday.”
Rep. Patty Bellock, another member of the group, said that making cuts while still preserving the integrity of the system will be difficult. “This is not an easy job. You’re talking about children on ventilators. You’re talking about seniors in wheelchairs. You’re talking about the most fragile population in Illinois,” Bellock, a Hinsdale Republican, said: “We want to do it right. But we also want to do it in a comprehensive caring way.”
But one thing that the governor and legislators on both sides seem to agree on is that the Medicaid liability must be drastically reduced to save the system from collapse.
Gov. Pat Quinn also called for a legislative working group to put forth proposals for reforming the state’s public employee retirement system by the beginning of this week, but that group was unable to reach an agreement.
“At my direction, this group is working with all interested stakeholders to solidify a framework for solving our pension challenges. I have set Tuesday, April 17, as the deadline for submitting their blueprint,” Quinn said during his February budget address. "I want to repeat: Everything is on the table for our pension working group. Historical funding practices, employer contributions, employee contributions, the retirement age, and the cost of living adjustment.”
Quinn is expected to unveil his own set of proposals tomorrow. “I think the governor is going to announce tomorrow what he thinks ought to be done,” said Sen. Bill Brady, a member of the group.
Brady, a Bloomington Republican, said that he expects Quinn’s proposal to contain some recommendations the group agreed upon and some they did not.
“It’s 24 hours away, but that’s sort of what we’re anticipating right now,” said Rep. Elaine Nekritz, who is representing House Democrats on the working group. The group was still holding meetings this afternoon. She said that the proposals were delayed not because negotiations met an impasse but because of the logistics of trying to tackle the two major issues of Medicaid and pension reform in just a few months. “I think the delay is more due to interactions with Medicaid and some of the other things going on,” she says. “I think it has less to do with pension stabilization and more to do with all the really big issues that are swirling around here,’ said Nekrtiz, a Northbrook Democrat.
However, Brady said that the lack of a presence from public employee unions has slowed the process. “One of the biggest reasons is we’ve asked labor to come and discuss it with us,” Brady said. “They have not accepted our invitation.” Brady said the pension group also plans to continue its work and has a meeting scheduled for next week.
Union officials say they have pulled out of the talks because they are unsure whether the working group is engaging in earnest negotiations. They are concerned that the members may not have the authority to speak for Quinn and the legislative leadership, so the bargaining may not be backed by a real ability to get whatever deal is reached approved by the full General Assembly.
Nekritz balked at that idea. “There’s been a process put in place, and I have had no indication from my leader, [House Speaker Michael Madigan], that that’s not on the table,” she said. “My understanding is that this is where it’s happening. If they don’t believe that, I can’t help that.”
"Early in the process, we requested relevant data to analyze the impact of any proposal made by the working group. To this date, we have received no data. In addition, despite previous assurances that the working group was empowered to speak for the governor and all the legislative leaders, it is no longer clear that that is the case,” Michael Carrigan said in a written statement on behalf of the union coalition We Are One. “Our unions are firmly committed to negotiating a solution to the pension funding crisis. However, to go forward, we need both the data supporting any proposals and a commitment that the representatives with whom we engage are authorized to speak for the governor and the legislative leaders.” Carrigan said in the statement that the group met with legislators working on pension reform on three occasions but that he does not know what will be in their proposal.
When asked if the push to release a plan not agreed upon by the working group might confirm Carrigan’s suspicions, a spokeswomen for Quinn said that the governor is most concerned with “moving the ball down the field.”
Brooke Anderson, the Quinn spokeswomen, said, “The governor in his budget address set deadlines, and we gave the working groups even a few days after those deadlines.” Brooks said that the longer the programs -- especially Medicaid -- go without reform, the more urgent the situation becomes. “I think the concern here and the priority is that we save the Medicaid system and that we save the pension system.”
Wednesday, April 18, 2012
By Jamey Dunn
The Illinois House approved a measure today that would make it more difficult to increase pension benefits, but Republicans argue that the same threshold should be set for tax increases.
There was no opposition in the House to a proposed constitutional amendment that would require that any increase in pension benefits for public workers to receive a three-fifths majority vote to pass. Currently, such increases require a simple majority. “There’s a lot of tough medicine in this resolution. I think the tough medicine is needed,” said House Speaker Michael Madigan, who sponsored HJRCA 49.
Under the measure, an increase to salary or wages would not constitute a pension benefit increase, unless the raise was excessive. Madigan said that lawmakers could set the parameters for “excessive” pay increases.
The amendment would up the required support to override a veto of a bill containing pension benefits to two thirds of each chamber. Currently, only a three-fifths majority is required to override a veto. It also calls for increased benefits for municipal public workers to be approved by a three-fifths majority of a local board or council.
Union officials say that the state’s billions in unfunded pension liability was caused by lawmakers and governors opting to skip annual pension payments, not by increased benefits. “This change to the Constitution would not address the true crisis threatening Illinois public retirement systems, which is the habitual failure of politicians to adequately fund the modest pensions earned by public employees. We continue to believe that this funding crisis can only be solved by all parties working together in good faith, and our union remains committed to doing so,” said Anders Lindall, spokesman for the American Federation of State County and Municipal Employees Council 31.
A recent report from the Commission on Government Forecasting and Accountability found that the bulk of the shortfall is a result of underfunding.
Lindall also argued that the reduced pension benefits that went into effect last year do not meet federal requirements for employees, such as teachers, who will not receive Social Security benefits for the time they work for the state. “The lower pension tier forced on newly hired public employees must be fixed to avoid severe federal penalties. It is unwise to make such needed amendments more difficult to achieve,” Lindall said.
However, Madigan said that support for sweetening the benefits of those hired under the new pension benefits system is part of his motivation for supporting the amendment. “I’ve already been in conversations where people are saying that the tier two — that was created a few years ago and is in place for those hired to public jobs after Jan 1 of 2011 — is not sufficient. That it has to be improved. That we have to make it better,” Madigan said. “So that’s another reason to support this resolution and raise that vote count because those that even in the current crisis think that we ought to be improving pensions are here at the Capitol building already laying the seeds for what will be their efforts very shortly to again improve pension benefits.” Madigan said that the amendment is not meant to put a stop to benefit increases, but it would make it more difficult to pass them. “If you are an individual here, or if you are a member of a group in the legislature who wishes to work against these bills, this will advantage your position. … You’ll have a better chance.”
Rep. Darlene Senger, a Naperville Republican, said that the measure is “a step in the right direction” but does not solve the state’s pension problems. “I do want everyone to know that when you see this on the ballot in November, there’s a lot more work that has to be done before then in regards to reforming pensions,” she said. “This does not change anything in regards to the debt for the unfunded liabilities … and it does nothing currently to the crisis we have in regards to our state budget with trying to fund pensions and Medicaid.”
Springfield Republican Rep. Raymond Poe said that the amendment should also protect against lawmakers voting to skip pension payments by setting the threshold to skip a payment at a three-fifths majority. “We also need a safeguard in there that you can’t short those payments in the future,” Poe said. The measure contains no such provision. The issue of guaranteeing future payments into the pension system will likely play into the ongoing negotiations over other pension reforms that may include reductions in benefits for workers hired before lower benefits for new employees went into effect last year.
After Madigan’s amendment was approved, Republicans moved to have two constitutional amendments that are languishing in the rules committee called to the floor for a vote. The amendments would require the approval of a three-fifths majority to increase taxes in the state. “Let me commend Speaker [Madigan] for realizing that some votes in this chamber carry heavier consequences and deserve a little bit of extra scrutiny. He is right that decisions that have great impacts on the fiscal health of Illinois residents and the state as a whole should have to meet a higher standard and require a greater threshold,” said Arlington Heights Rep. David Harris, who is listed as a sponsor on both amendments. Harris argued that such a higher threshold should also apply to tax votes. “This is nothing significant or new. We already require a higher voting standard for borrowing, for laws that would preempt home rule and to overturn the governor’s veto. The next logical steep would be to require the very same threshold for bills that would make Illinois residents have to pay more taxes.” The Republicans’ efforts were blocked and the measures did not come up for a vote.
If the Senate approves HJRCA 49, it would appear on the ballot in the November general election. To be included in the state’s Constitution, it would require the support of either three-fifths of those who choose to vote on the question or the majority of those voting in the election .
Tuesday, April 17, 2012
As pension reform talks flounder in Illinois, a polarizing national figure drew union protests today in Springfield.
Wisconsin Gov. Scott Walker spoke to a gathering of business leaders today at their annual lobbying event in Springfield. Doug Whitley, president of the Illinois Chamber of Commerce, said the chamber’s decision to invite Walker was not meant to incite disagreement. Rather, the group wanted to contrast the ways that Wisconsin and Illinois have sought to address budget deficits. Whitley said Wisconsin avoided a tax increase and encouraged economic growth by implementing business friendly policies such as tax breaks and reducing regulation. He said Illinois lawmakers should be “conscious” of what is happening in neighboring states and concerned about keeping the state competitive. “There are economic consequences to bad public policies,” Whitley said.
But Whitley also warned that unions should be prepared for change. “It appears that things are changing. Wisconsin made very bold action this past year. Indiana just passed right to work legislation just a few weeks ago. I think organized labor in the country recognizes that things that have been in the past are going to be subject to change,” Whitley said. “We cannot sustain the trajectory that we have been on. We’ve raised taxes, and we still have budget problems. The solutions to those budget problems are very similar to what Wisconsin did, which was to control cost and cut spending. When you control cost and cut spending, then that goes directly to influence the life-public-employee-union members. And so, yes, they are at risk.” While Whitley said the group did not invite Walker because of his push for laws that strip Wisconsin labor unions of collective bargaining rights, he would not say whether he supported such moves. “That is not the issue before the General Assembly.”
Walker, who is facing a recall election in June, gave what seemed much like an election stump speech, touting what he sees as accomplishments from his year in office. He cited the state’s balanced budget, which he says was achieved through fundamental reforms instead of slashing core services or increasing taxes. “I think at the time, there were a lot of people down here at the state Capitol who are proponents of these tax increases, who looked at what was happening last year in Wisconsin and kind of proudly said, 'Well, we’re not going to do what Wisconsin did. Well, clearly the state government in Illinois didn’t,” Walker said. “Obviously things haven’t gotten any better when it comes to the state budget down here.” Walker blamed his recall election on “union bosses” and national union organizations that see him as a threat to their power.
He also cracked wise about his revival of an old tourism slogan, “Escape to Wisconsin,” which Walker brought back as an attempt to appeal to businesses after Illinois increased its income tax rate last year.
“I’m not concerned about Gov. Walker trying to poach Illinois jobs," Whitley told those in attendance. "Illinois is the fifth largest state in the country. We have job growth going on.” He said he is encouraged that Illinois leaders are working to address some of the business community’s biggest concerns, such as growing pension and Medicaid costs. “Even our governor, who as most all of you know, has had very liberal tendencies, very socialist tendencies for years. Even some might say radical tendencies. A month ago [he] stood up and gave a budget message that was not too much different than what you and I and the Illinois chamber would like to hear our chief executive officer talk about.”
While Walker drew a group of attendees to the event that was comparable to previous years, he also brought out a large crowd of union protesters upset with his policies. Anders Lindall, spokesman for the American Federation of State, County and Municipal Employees Council 31, said that inviting Walker to speak “shows for one thing how out of touch from regular people those corporate lobbyists and corporate chieftains really are.” Lindall said protesters who turned out today from multiple unions, including private sector affiliations, represent the hard-working core of the state’s middle class. Protester Cary Quick said: “Myself and many of my brothers and sisters that are union members came out to give Scott Walker an unwelcome to Illinois and ask him to go back … and take back all his union-busting, corporate bolstering political ideas to Wisconsin with him — to where he can await his soon-to-come unemployment and allow Wisconsin to get themselves back on track.” Quick said he plans to travel to Wisconsin in the coming months to campaign against Walker.
Quick, who works as a mental health technician at the Choate Developmental Center in the southern Illinois city of Anna, says he came to Springfield to send a message to lawmakers that moves such as Walker’s attacks on public employee unions “would not be tolerated” in Illinois. Quick said he is worried about losing pension benefits, as well as Gov. Pat Quinn’s proposal to close several state facilities. While Choate is not on the list for potential closure, Quick said he is concerned that facility closures in the area would hurt his community. Union County, where Anna is located, had a 13.6 percent unemployment rate in February. Walker and Illinois public employee unions do agree on one thing: Both say that Quinn’s proposal to close several state facilities and layoff workers would be bad for Illinois’ economy. “All those things will have a negative impact on public employees in the state,” Walker said.
But Quinn insists that the closures have to take place to balance the state’s budget.
Quinn steered clear of Walker’s appearance, instead going to Chicago to announce that Lafarge North America, a concrete company, plans to relocate its Virginia headquarters to the Chicago area. The company says it will bring about 90 jobs. “Well, they’ve had some tough times up there since he got elected governor. They’ve lost jobs,” Quinn said at the Chicago event about Walker. “And we certainly don’t want to follow his prescriptions when it comes the economic growth.”
Quinn, who has been a vocal critic of Walker’s polices in the past, said neighboring states should work together to improve the region instead of nursing rivalries. “Our focus in not on any other state. We believe in cooperation with our Midwestern neighbors. …We think our approach of investing in important things and investing in human beings and their education is the best way to get job creation.”
Quinn’s hopes of reforming the state’s underfunded public pension systems seem to be struggling, as public employee unions have announced that they are not negotiating with the legislative working group. Michael Carrigan, Illinois AFL-CIO president, said the unions are asking for data that they have not been given, as well as assurances that the lawmakers in the group can negotiate on behalf of Quinn and the four legislative leaders. “Our unions are firmly committed to negotiating a solution to the pension funding crisis. However, to go forward, we need both the data supporting any proposals and a commitment that the representatives with whom we engage are authorized to speak for the governor and the legislative leaders,” Carrigan said in a written statement from the We Are One Coalition, which represents several unions in the state.
Quinn had set today as the deadline for the pension working group to present its ideas, but Brooke Anderson, a Quinn spokeswoman, said the group, as well as another working group that plans to propose Medicaid cuts, asked for more time. She said both sets of recommendations should be presented by the end of the week. “You should not worry about holding your breath too long because it will be very shortly,” Quinn told reporters in Chicago today.
By Ashley Griffin
A state panel of education experts has released a set of recommendations that does not include forced consolidation of districts — a move that Gov. Quinn has advocated for.
The Classrooms First Commission, a panel that, along with education experts, includes lawmakers from both parties, released recommendations that favor “voluntary” consolidation and shared services between schools. According to the report its suggestions could save the state up to $1 billion.
The recommendations come after Gov. Pat Quinn proposed consolidating many of the state’s school districts to save money. The group, known as the Classrooms First Commission, found that under current law, a move to consolidate Illinois’100 high-school-only districts with 377 elementary-only districts into 101 districts could cost the state nearly $4 billion. The $4 billion price tag comes from incentives the state must pay when combining districts. However, Quinn originally believed the plan would save more than $100 million.
The report found that a more cost effective approach would be to eliminate or modify some state laws that discourage school districts from voluntarily consolidation. According to the report, at least 40 school districts were considering this option.
“Forcing districts to merge is not realistic, but providing them the resources and tools to consolidate on a voluntary or virtual basis is well within reach,” state Rep. Linda Chapa LaVia, a member of the Classrooms First Commission said in a prepared statement.
Under the new recommendations, no school would be forced to consolidate, but sharing school services is emphasized and encouraged. According to Lt. Gov. Shelia Simon, who chairs the commission, “this is about voluntary consolidation where it works and virtual consolidation where it can help.”
“We already have in Illinois 12 countywide school districts for the smallest counties, and I don’t want to tell those school districts to consolidate even more, I want those school districts to have the opportunity to work with neighboring school districts to share an advanced biology professor, to share a contract on purchasing textbooks, so that even though we're not asking them to consolidate, we're encouraging them to get the benefits,” said Simon.
The draft report recommends a variety of changes such as: phasing in lower tax rates for new unit districts, piloting a new capital project list that targets school construction money at districts willing to consolidate and requiring counties with declining school-age populations to determine whether a countywide consolidation or sharing services would help struggling schools perform better.
“Shared services offer school districts the opportunity to provide more diverse curriculum options and expand educational opportunity, while streamlining delivery and saving money,” Jason Leahy, executive director of the Illinois Principals Association and a member of the Classrooms First Commission said in a prepared statement. “It is my hope that the Classrooms First Commission recommendations will point districts toward the tools and resources they need to accomplish this goal.”
Although for some schools, the idea of consolidation seems inevitable, Simon has acknowledge concerns that schools worry about losing identity and local control under consolidation.
“We held hearings across the state, and we definitely heard a lot of folks who talked about the importance of local control of schools. And what this set of draft recommendations does, it says we recognize that, we recognize the value of local control, but we also want to make sure that having a small locally controlled school district doesn’t mean you’re missing out on a higher level math course, or you’re missing out on the savings that can come from working together with another school district,” said Simon.
The commission also plans to hold four statewide hearings to get feedback from the public on the new draft recommendations. Those hearings are scheduled on:
• April 19th at Parkland College in Champaign.
• April 20th at Southern Illinois University in Carbondale.
• April 26th at Prairie State College in Chicago Heights.
• April 30th at Rock Valley College in Rockford.
The final report is scheduled to be completed by July 1, when it will be submitted to Quinn and the General Assembly.
Monday, April 16, 2012
By Ashley Griffin
The number of autism cases is on the rise, but funding for autism-related programs in the state has been dropping and could take another hit under the budget for next fiscal year.
A recent report from the Centers for Disease Control and Prevention (CDC) found that nationally, one in 88 children under 8 years old have been diagnosed with autism spectrum disorder, which can cause significant social, communication and behavioral challenges. The rate was determined with 2008 data, and the new figure represents an increase from one in 110 children living with autism in 2006. The report states: “Comparison of 2008 findings with those for earlier surveillance years indicated an increase in estimated ASD [autism spectrum disorder] prevalence of 23 percent when the 2008 data were compared with the data for 2006, and an estimated increase of 78 percent when the 2008 data were compared with the data for 2002.”
Experts believe that improved diagnostic methods and increased awareness of the disease has contributed to the increase. “Some of the increase is due to the way children are identified, diagnosed and served in their local communities, although exactly how much is due to these factors in unknown,” the report from the CDC said.
Minority children saw the largest increases. Between 2002 and 2008, The number of African-American children diagnosed with autism increased by 91 percent, and the number of Hispanic children diagnosed increased by 110 percent. Caucasian children saw a 70 percent increase over the same time frame. “We suspect that some of this increase is due to greater awareness and better identification among these [minority] groups. However, this finding explains only part of the increase over time, as more children are being identified in all groups,” the study from the CDC said.
According to The Autism Program of Illinois, 30,000 children between the ages of 5 and 19 are living with autism in the state. Mark Schmidt, a spokesman for the group, says the number of cases could possibly be as high as 39,000 because without proper screening, many children do not get the treatment they need. Schmidt said his organization is seeing the CDC’s findings play out in the state as more families are seeking services for children with autism. “We are definitely experiencing what the CDC is reporting.”
Although an autism diagnoses does not include tangible medical evidence such as blood test, it requires an observational test performed by a doctor who studies a child’s interaction. This can make it more difficult to diagnose than some other conditions. The CDC recommends if a parent notices some behavioral problems by the child’s first birthday, a screening maybe necessary. Autism is almost five times more likely in boys than in girls.
As the number of cases have increased both nationwide and in Illinois, funding for some autism programs in the state have been on the chopping block for several years in a row. Schmidt says funding has decreased about 14 percent over the last four years. “We are going to see a tremendous decrease in the amount of services.”
In fiscal year 2012, The Autism Program of Illinois received $4.6 million. Under Gov. Pat Quinn’s proposed budget for FY2012, the group would get $4.1 million. However, lawmakers are on course to pass even bigger cuts than Quinn called for, so the final funding level could be less. Schmidt said that the cuts would lead to less services being offered to families who have children with from autism. He said the cuts would also make it harder to keep staff numbers up and make sure that employees are properly trained. The cuts could also lead to fewer hours of direct treatment for patients with autism. According to Schmidt, the cuts would result in 1,800 children not receiving some of the services offered by TAP, such as speech therapy, group support and early intervention for families.
However, the Illinois Department of Human Services says the cuts are necessary to help the state regain control of its finances. “These are serious fiscal times, and tough cuts were made across all agencies. In order to move Illinois forward, we must reform and stabilize its Medicaid and pension systems ASAP. If we don’t tackle the task this spring, budget cuts will be much deeper and even more painful for programs and providers alike in FY 13,” Januari Smith, a spokeswoman for the Department of Human Services, said in a written statement.
Sunday, April 15, 2012
Saturday, April 14, 2012
Friday, April 13, 2012
Thursday, April 12, 2012
By Ashley Griffin
As the housing crisis continues to ravage many neighborhoods in the state, a study released today has identified a new breed of foreclosure that is on the rise.
The report found that conventional mortgages given by banks represent a growing percentage of new foreclosures in the Chicago and Cook County area. It also reported that nearly a quarter of new foreclosure filings in 2011 were on loans that originated before 2005. That indicates the foreclosure crisis has now hit homeowners who had been able to afford their monthly payments for six years or more.
In the past when borrowers lost their homes, experts pointed to subprime mortgages, which were marked by fluctuating interest rates and balloon payments. But the Chicago-based Woodstock Institute's report found that residents in the Chicago area are defaulting on more traditional loans, as well. “These new data show that even those buyers who took the less risky route of buying a home with a conventional mortgage are not immune from the impacts of the foreclosure crisis,” Spencer Cowan, vice president of the institute, said on the organization’s website. Cowan said the trend may have been brought on by the high employment rate. “People’s incomes have dropped; that’s why they cannot afford a mortgage anymore,” he said on a conference call today.
The report states: “The type of mortgages entering foreclosure has changed since 2008. At the beginning of the current downturn, mortgages of single-family homes entering foreclosure were almost equally divided between conventional fixed-rate, Federal Housing Administration (FHA) and Veteran’ Administration (VA) loans, at 50.1 percent of filings; and riskier mortgages, including Adjustable Rate Mortgages (ARMs) and balloon payment mortgages, at 49.2 percent of filings. By 2011, 68.2 percent of single-family home mortgages entering foreclosure were conventional, FHA, or VA loans, and only 29.4 percent were ARMs or balloon mortgages.”
The report also found the number of foreclosures in the Chicago region has declined, reaching about the same level as in the second half of 2008. There were 30,943 foreclosure filings in the six-county Chicago region during the second half of 2011, compared with 40,775 for the second half of 2010, a decrease of 24.1 percent. For the full year, foreclosure filings decreased by 18.9 percent, from 76,986 in 2010 to 64,877 in 2011.
Although the number of foreclosures has dropped, Cowan believes the reductions may be a product of recent delays in the clogged foreclosure system. (For more on the overburdened foreclosure system, see Illinois Issues March 2011.) In 2011, there were almost 31,000 foreclosure filings but only 11,766 auctions in the six-county region, which suggests that the backlog in the courts may have increased. “Without concerted effort to address the forces that drive foreclosure activity, such as negative equity and unemployment, foreclosures will continue to drain wealth from all corners of our society,” Cowan said.
Wednesday, April 11, 2012
By Jamey Dunn
If you do your reading on a Kindle, iPad, NOOK or other electronic reading device, state and federal officials say you could be getting gouged when you buy best-selling books.
Illinois joined 14 other states and Puerto Rico to sue Apple and book publishers Penguin Group, Macmillan and Simon & Schuster over allegations of price fixing and violating anti-trust laws. “By colluding to fix the price of e-books, publishers and Apple essentially forced consumers to pay millions more for e-books than they otherwise would have paid,” Illinois Attorney General Lisa Madigan said in a written statement. “Enforcing the state’s antitrust laws will ensure that consumers receive the full benefit of competitive pricing and choice in the marketplace.” Madigan is seeking refunds for Illinois customers who were overcharged under the scheme.
The U.S. Department of Justice is also suing Apple and book publishers Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster. The lawsuit alleges that the publishers and Apple colluded to prevent a drop in the costs of electronic books as competition grew. The DOJ and Madigan say that before Apple entered the marketplace in 2010, most bestsellers were $9.99, but after the company entered into agreements with publishers to raise the prices, the price tags went up to $12.99 and $14.99, and Apple received a 30 percent commission on the sales. Publishers then demanded the same prices from other booksellers. “Based on the commitments to Apple, the publishers imposed agency terms, over some objections, on all other e-book retailers,” said a written statement from the Justice Department.
“Beginning in the summer of 2009, we allege that executives at the highest levels of the companies included in today’s lawsuit — concerned that e-book sellers had reduced prices — worked together to eliminate competition among stores selling e-books, ultimately increasing prices for consumers,” Attorney General Eric Holder said today at a Washington, D.C., news conference. “As a result of this alleged conspiracy, we believe that consumers paid millions of dollars more for some of the most popular titles.”
Some publishers have argued that their agreements with Apple prevent Amazon.com from holding a monopoly over the e-book marketplace.
Hachette, HarperCollins and Simon & Schuster agreed to settle with the Department of Justice. Under the terms of the settlement, they must end their agreements with Apple and allow retailers to sell their e-books at discounted prices. Amazon said in a written statement that as a result of the settlement, it plans to drop the cost of some of the e-books it sells.
Tuesday, April 10, 2012
By Jamey Dunn
The state’s safety net hospitals say Illinois should crack down on Medicaid eligibility instead of cutting rates paid to health care providers or services to those who truly need the program.
“Every day, I see people in my office, and I can’t imagine why in the world they are on the Medicaid roles. They have income, they have the means to obtain insurance,” Mark Newton, president and chief executive officer of Swedish Covenant Hospital in Chicago, said at a recent Illinois House committee hearing in Chicago. “We have employees who elect not to take the coverage and go on Medicaid,” Newton said. “If an employer is offering health insurance today, why is somebody allowed to go on Medicaid?”
Newton said his workers also see indications of potential fraud. He said patients with pacemakers come in with their pacemaker registered under one name and their Medicaid coverage under another name. “Now how does that happen?” he asked.
Newton joined a group of the so-called safety net hospitals, which are located in low-income and medically underserved areas of the state, that put forth a list of suggestions as the state looks to cut $2.7 billion in Medicaid growth. Administrators of hospitals in the association say that without the care they provide, many Illinoisans would find themselves in health care deserts with no other options nearby. Many of the hospitals are also the largest employer in the areas they serve.
One of the key components of the proposal from the Illinois Association of Safety-Net Hospitals is tightening they way the state checks eligibility. The group estimates that100,000 to 300,000 patients currently on the Medicaid rolls earn too much to qualify for the program and that $400 million to $1.2 billion could be saved if Illinois took more steps to ensure that all who are receiving Medicaid benefits actually qualify for them. “The system is not being administered effectively to put those dollars where they’re going to have the most impact,” Newton said.
But the state has already hit roadblocks on efforts to determine eligibility. It took a year for the federal government to approve a plan to check state records to ensure that applicants are residents of the state. The feds have yet to make a decision about another provision that would require applicants to regularly provide proof of income. The association also says Illinois should capture more federal matching dollars and determine if some patients or services may be covered by alternative options, such as the federal Medicare program. The plan also calls for charging a $10 copay to patients who go to the emergency room for nonemergency care. A federal waiver would be required for such a move. Overall, the group says the proposal could save about $1.4 billion. The hospitals are calling on lawmakers to consider the proposal before cutting provider rates or care to patients.
Administrators from the safety net hospitals said that reductions to provider rates and services covered by Medicaid could leave the already fragile institutions “near or at complete breakdown.” Dennis Ryan, vice president of external affairs at the Holy Cross Hospital, said his institution on the south side of Chicago already came “perilously close to closure” four years ago. “Lives and well beings can be at stake, and undue cost cutting risks are both unethical and immoral,” Ryan said. “You cannot fly an airplane without a wing.” Providers said that the looming $2.7 billion in cuts is already affecting their operations by making it difficult to borrow money to cover budget shortfalls. “A number of banks are now telling us that they will not extend letters of credit because Illinois is not the place that they want to do business,” Newton said.
Monday, April 09, 2012
Sunday, April 08, 2012
Saturday, April 07, 2012
Friday, April 06, 2012
Thursday, April 05, 2012
By Jamey Dunn
According to a state audit released today, the state’s Firearm Owner Identification system is flawed and may be a risk to public safety.
Auditor General William Holland found that the vast majority of counties are not submitting court orders to the state that would disqualify card holders from gun ownership. “The effectiveness of the Illinois FOID card program operated by the [Illinois State Police] is limited in promoting and protecting the safety of the public. There are significant deficiencies in the reporting of individuals with potentially disqualifying mental health conditions to the Illinois State Police. Consequently, in most counties, if the court finds individuals to be a “mental defective” or “intellectually disabled” (terms used by the Act), ISP is not receiving the information needed from the circuit court clerks to revoke or deny FOID cards for individuals from those counties. Unless reported by another source (such as a state-operated mental health facility, hospital, etc.), individuals from those counties could receive or continue to hold a valid FOID card and could use it to purchase firearms and ammunition,” the audit said.
According to the state police, there were 1,316,508 individuals with active FOID cards in Illinois as of January 2011. The Illinois State Police’s Firearms Services Bureau received 903,139 FOID applications from 2008 to 2010. Of those, 879,906 were approved and 20,152 were denied. Auditors found that only three of the state’s 102 circuit clerks had submitted mental health rulings to the state, and the court orders that were submitted were lacking important information, such as the ages and genders of subjects.
Holland’s report also notes that the mental health information that should be passed on to the federal government was not being shared. “In addition, because many of these disqualifying conditions are also required to be reported to the Federal Bureau of Investigation’s (FBI) National Instant Criminal Background Check System (NICS), which is used by other states when individuals purchase firearms, the safety of the general public as a whole is at risk.”
Monique Bond, a spokeswoman for the Illinois State Police, said in a written statement: “The department has already been in contact with the Illinois Administrative Office of the Courts for assistance in communicating with the courts and clerks and is partnering with the attorney general’s office in drafting a letter to the clerks explaining the requirement and how best to communicate with the department.”
But clerks argue that they cannot submit the information unless ordered to by a judge. “The role of the clerk is ministerial in nature. The court must make the determination that an individual is mentally defective, and as such, direct the clerk to notify the state police of that status. Without that direction from the judge and court, the clerk would be in the position of making determinations regarding who is entitled to a FOID card. Such a situation would not only create potential liability for the clerk’s office but usurp the authority of the court,” Gina Noe, president of the Illinois Association of Court Clerks and a circuit clerk in Marshall County, said in a written statement. “The Illinois Association of Court Clerks has been communicating with the Illinois State Police on this issue and will continue to do so.”
Bond said the Illinois Department of State Police is backing House Bill 4456, which would clarify the clerk’s role in the process and require them to submit such rulings with or without direct orders from a judge.
The audit found other problems with the system beyond the lack of mental health records. Thousands of cards were not being delivered to applicants. The State Police told auditors that many of these cards were returned by the post office as undeliverable. Auditors estimated that 6,200 cards had come back to the State Police. The department did not have enough people to answer phone calls related to the FOID program. During the last quarter of 2010, 85 percent of calls went unanswered.
“On some days during peak times, more than 1,000 calls per day are received. Like government agencies across the country, we are doing more with less and are in the process of looking at ways to manage these expectations. If an employee calls in sick, in order to maintain a steady flow in processing applications, we have to rely on the employees that are available, resulting in overtime,” Bond said. She said that the department is considering a more automated phone system.
The state police also spent hundreds of thousands of dollars on overtime costs associated with processing FOID applications. Between July 1, 2009, and June 30, 2011, the state police spent $526,919 on overtime for the FOID program. Almost $240,000 of that went to three employees.
The department was unable to process FOID card applications by the 30-day deadline for approval or denial of applications. “In 2008, only 40 percent of cards were approved within the required 30 days. The processing times improved to 80 percent in 2009 and decreased to 70 percent in 2010,” the report said. “In 2008, 67 percent of FOID cards were denied within 30 days. The percentage increased to 78 percent in 2009 and decreased to 67 percent in 2010.”
Bond said that rushing the application process could compromise public safety. “More than 50 percent of the applications without criminal issues are processed and mailed within one week of being received. The backlog is a result of those applications that require more scrutiny.”