Education cuts "rough" this year, worse next year

By Bethany Jaeger
Grant-funded education initiatives ranging from after-school programs to gifted education were “zeroed out” in a $7.2 billion budget adopted today by the Illinois State Board of Education.

The budget relies on about $362 million in cuts. It would have been worse without about $2 billion in federal stimulus funds, which won’t be available next fiscal year.

“This is a rough year. Next year could be a catastrophic year,” said Jesse Ruiz, chairman of the Illinois State Board of Education, which met in Springfield today for an emergency meeting to enact the fiscal year 2010 budget.


Next fiscal year, the board anticipates having to cut an additional $1 billion “just to tread water” and maintain this year’s funding levels, even with 25 percent to 100 percent reductions for education-related grants, said state superintendent Christopher Koch.

The cuts are the result of a $26 billion state operating budget enacted last week. The General Assembly relied on $3.5 billion in short-term borrowing. While much of that money is earmarked to helping prevent more severe reductions in grants to community-based services, none of it so far has been dedicated to education-related grants.

For instance, agricultural education was cut in half. Early childhood education programs were reduced by a third. Bilingual education lost funding by a quarter. And $3 million for homeless education programs was eliminated, but the board said federal stimulus dollars will cover some costs this fiscal year. As we wrote about in Illinois Issues magazine this spring, the number of homeless youth is increasing while funding has failed to keep pace for years.

When deciding how to spread the pain, the board chose to fully fund general state aid and so-called mandated categoricals, which cover special education and transportation costs. The minimum amount of state aid provided for each student increased by $160, bringing the so-called foundation level up to $6,119.

Board member Joyce Karon said fully funding general state aid and mandated categoricals accomplishes two goals: It spreads the money around to reach as many students as possible and grants the most flexibility to local school districts.

The board also avoided cutting programs or line items that would leverage significant amounts of federal matching funds. If the board decreased funding for certain programs, it would fail to satisfy federal requirements to maintain past funding levels, added Linda Mitchell, the board’s chief financial officer.

“The budget passed by the General Assembly gave the board a lot of discretion, and that means gave the board a lot of difficult choices — a lot of ‘Sophie’s Choices’ of which children and which programs,” Mitchell said.

Ruiz added that the General Assembly again is mandating that districts provide such services as bilingual education but it is not approving the necessary funding. “We are just in essence putting the burden on local districts to somehow find the means and putting more stress on them,” he said. “And we can’t, as regulators in that regard, let them off the hook. Yet, we’re kind of passing the buck.”

On multiple occasions he reminded more than two-dozen advocates in attendance that the new budget has a political context: Incumbents and candidates will be campaigning throughout the state as they prepare for the 2010 elections. He said this year’s budget process, while disheartening, should energize advocates to pressure politicians to explain why they rejected revenue increases.

“Before you give them a check and a dime, challenge them and ask them how they’d invest in education in the future,” he said. “And I don’t want platitudes. I want specific plans. And make sure how they’re going to balance it all.”

He continued: “We need to become very, very, very discriminating consumers of our public officials. And I for one would raise the benchmark in my level of scrutiny in that regard. Keep your dollars in your pocket. Give to a school before you give it to a candidate.”

One advocate was Linda Drust, Williamson County Early Childhood Cooperative executive director. She said the 33 percent reduction to early childhood block grants would mean that her organization, which serves five school districts in southern Illinois, would go from serving 600 at-risk children to 400. She said she did not have alternative funding sources.

One wild card is whether Gov. Pat Quinn will use some of his discretion in a limited amount of money left over to fund such grants as early childhood education. The short-term borrowing scheme approved as part of the fiscal year 2010 budget deal allotted $2.3 billion to community-based human services and left $1.3 billion for him to spend as he chooses.

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Ready, set, repeat

Reminiscent of last year, a whole host of state policy issues remain up in the air throughout the summer. Inaction mostly rests on the shoulders of Democrats, who are repeating history by agreeing on practically nothing. The main culprits are Gov. Rod Blagojevich and House Speaker Michael Madigan, each of whom blames the other for lack of action. Meanwhile, Illinois is in its ninth year without a capital construction plan, campaign funding reform remains dormant, many state services and agencies are operating with stagnant or decreased funding and long-term costs of health care and pensions continue to compound.

Legislators and the governor will return to Springfield this week with lots to talk about, but little progress is anticipated. Here’s a chronological list of activities with some context.

Today: Comptroller Dan Hynes issued a statement that he would not cut the checks for pay raises for state legislators and officers if they are enacted because the General Assembly never gave him authority to spend the necessary money. “We cannot implement the pay raises without an appropriation. But more importantly, I am of the opinion that this is no time for pay raises,” he said in a release, citing budget cuts for social services and Medicaid providers. The House rejected the pay raises, but the Senate has yet to do so. In the larger scheme of things, the pay raises simply are a battle of public perception. While such state services as substance abuse treatment struggle to meet demand because of $43 million in budget cuts, it would look disingenuous if legislators received their annual 3 percent cost-of-living adjustments at the same time they receive significant pay raises, costing about $1.1 million just for constitutional officers, legislators and top state agency officials, according to the comptroller’s office. That doesn't count pay raises for judges.

Tuesday: Expect Gov. Rod Blagojevich’s idea to move about 140 state employee positions from Springfield three hours south to be rejected by a bipartisan legislative review panel. Expect that rejection to be followed by the governor’s statement that the move is going to go forward, anyway. Lots of union-backed employees will be up in arms again. Meanwhile, they’re still working under last year’s contract with the state while their union, the American Federation of State, County and Municipal Employees Council 31, remains gridlocked (click this link and scroll down) with the administration. Among the key sticking points are employee wages and employee contributions to health care and pension benefits.

Tuesday and Wednesday: Gov. Rod Blagojevich called legislators back to the Capitol to address two major issues: funding for education on Tuesday and funding for capital construction projects Wednesday. But neither session meets until late in the afternoon, giving legislators time throughout the day to attend various events at the annual State Fair in Springfield. Governor’s Day (a.k.a. Democrats’ Day) is Wednesday and Republican Day is Thursday. Watch for political fireworks off stage.

Ongoing: The governor says he’ll “rewrite to do right,” his slogan for changing agreed-upon bills to include his agenda. If the General Assembly rejects his changes, then the underlying bill dies. So far, he’s changed two bills. One would allow all adults up to age 26 to remain on their parents’ health insurance plans. The original intent was limited to college students who took a medical leave or who reduced their course loads to part time because of an illness or injury. They would have been covered for a year on their parents' plans. A second amendatory veto would extend property tax exemptions to all veterans with service-connected disabilities certified by the U. S. Department of Veterans’ Affairs. The original bill regarded a tax increment financing district in the Village of Downs. Blagojevich has said he will continue amending numerous bills in his Rewrite to Do Right campaign, “to take positive action on legislation that has been sent to him by the General Assembly,” according to a statement from Brian Williamsen, his spokesman.

August 29: Later this month marks the deadline for the governor to sign, change or reject ethics reforms sent to his desk in June. His office repeatedly has said he doesn’t think the ethics reforms go far enough. One potential amendment could include banning state contractors from donating to statewide political parties. The original legislation, which received unanimous approval by the General Assembly in May, only prevented state contractors holding contracts worth $50,000 or more from donating to statewide officeholders who sign the contracts.

Also coming up: One of the House Democrats’ point people on education, Rep. Mike Smith of Canton, announced that he’ll host a series of public hearings to consider a proposal to abolish property taxes for school funding by 2010. It’s been floated by Sen. James Meeks, a Chicago Democrat who previously threatened to run against Blagojevich for governor in the absence of education funding reforms. Meeks didn’t run, but he also didn’t get what he wanted. So here we go again. Add education funding reform to a huge pile of politically sensitive Statehouse issues that likely will grab some headlines but will remain stalled, at least before the November elections.

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Lincoln Bicentennial Special License Plates

Earlier this week, I wrote that House Minority Leader Tom Cross had indicated police groups have expressed concerns with special license plates and that there had been a general "move away" from the issuance of new special plates in Springfield. I also mentioned that Representative Cross, and several other legislators, subsequently voted for special "In God We Trust" plates.

Yesterday, the House adopted an amendment to another "In God We Trust" special plates bill, transforming it into a "Lincoln Bicentennial" special plates bill. The new special plates would cost an additional $25 initially and upon renewal. Upon issuance, $10 would go into a new Lincoln Legacy Scholarship Fund; and $15 would go into the Secretary of State Special License Plate Fund to help defray the administrative processing costs. With each renewal, $23 would go into the Lincoln Legacy Scholarship Fund; and $2 into the Secretary of State Special License Plate Fund.

Subject to appropriation by the General Assembly, and approval by the Secretary, all money in the Lincoln Legacy Scholarship Fund would be paid as grants to the Illinois Community College System Foundation, to be used to fund the Lincoln Legacy Scholarship program, founded by the Illinois Abraham Lincoln Bicentennial Commission. The Illinois Community College System Foundation is a 501(c)(3) nonprofit; and the Illinois Abraham Lincoln Bicentennial Commission was created by Governor Rod Blagojevich, by executive order, back on February 14th of 2006. The Illinois commission is separate and distinct from the federal Abraham Lincoln Bicentennial Commission on which several Illinois representatives also serve.

The bill has been scheduled for a third reading and short debate; and if it passes, it will then go to the Senate for approval. I have three questions for readers to answer in their comments:

1. Considering the concerns allegedly expressed by police groups regarding special license plates, should the General Assembly be authorizing the creation of new special plates?

2. What do you think about the practice of creating a separate "special fund" within the State treasury for each of these special plates, as has been the common practice?

3. Do you think that this proposal would be a good use of the funds? (i.e. Would the funds be going to the right organizations and be earmarked for the best possible use?)

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Our underfunded colleges

From the Chicago Reader blog Chicagoland...

Due to persistent underfunding from Springfield, our state's 60 public colleges and universities have now deferred approximately $3 billion in maintenance costs.

If this is a serious problem then why is the governor talking about tearing down an academic hall at Northern Illinois University or mistaken donating money to a school not connected with a church who's landmark sanctuary was burned down?

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The new "tax swap"

Senate President Emil Jones Jr.’s name appears on the list of sponsors of a version of a “tax swap” that would reform the way Illinois pays for public education. His support is a reversal from the Democratic leaders’ alliance with the governor last year but consistent with Jones’ stances in years before that. Support from the chamber leader is a big boost for Sen. James Meeks and Sen. John Cullerton’s measure, but the bill has two main hurdles: 1) Gov. Rod Blagojevich’s expected veto of anything that increases state income taxes and 2) the curse of gaming legislation, or getting so weighed down by trying to please everyone that the bill implodes and goes nowhere.

The measure advanced today from the Senate Education Committee, the first of many public hearings planned for this legislation before it’s ready for a vote by the full Senate.

Senate Bill 2288 is the new Senate Bill 750, but it has major differences. (Some are mapped out by Senate Democrats here. The main difference is that the new version would raise a lot more revenue — $7.2 billion — to do a whole lot more, funding a statewide infrastructure program and paying down state debt. Specifically, highlights include $633 million for early childhood and primary education, $300 million for higher education, $2.9 billion for property tax relief adjusted for inflation each year, $600 million for a family tax credit adjusted for inflation each year, $1 billion for a road and school construction plan and more than $1 billion for state pension and Medicaid debt.

“The goal of this bill is to pay off our debts,” Cullerton said in the committee hearing. He later added, “Not one penny is going to the operations of state government.”

Some Republicans in the committee found that hard to believe, but Cullerton said the sponsors eagerly seek input from the GOP and the House to codify better language. The sponsors still have the same list of supporters and opponents as 750. Most education and labor groups support it. Opponents include business groups and the Illinois Department of Revenue. (One school board in Chicago’s northwest suburbs of Palatine and Schaumburg opposed the property tax relief portion and said schools across the state can’t trust Illinois government to deliver, but those witnesses also said they supported many funding reform ideas in the legislation.)

The way the measure would raise the money is by increasing the personal income tax rate from 3 percent to 5 percent and the corporate rate from 4.8 percent to 8 percent. It also could, although it doesn’t yet, take back $800 million from the portion of the state income tax revenue that local governments currently receive.

On the spending side, the measure lists general initiatives but doesn’t specify where the money would go. Also absent, so far, are “accountability” measures, or safeguards for how state and local governments spend the money as intended. That’s a necessary component for Democratic Sen. Susan Garrett of Lake Forest. She voted “present” in committee to symbolize her concerns. “There has to be oversight. It’s not going to happen with this magic wand. I could never support this, especially from my area, without some major, major reforms.”

Meeks said those reforms are going to be drafted after collecting ideas in a series of public hearings, which is particularly important when “nobody trusts us to do what we say we’re going to do.”

We’ll have more details as they unfold. In the meantime, it’s safe to say this version isn’t going to advance for a while, maybe months.

The governor’s response is, according to an e-mail from spokeswoman Rebecca Rausch: “The push for an income tax increase isn’t new in Springfield. The governor’s position hasn’t changed. He thinks we should cut taxes, not raise them — especially at a time when families are already dealing with higher gas bills, higher prices for goods and stagnant wages.”

Jones’ spokeswoman, Cindy Davidsmeyer, said the Senate president has said and continues to say that he will not call this type of controversial measure for a vote on the Senate floor unless it has enough votes to pass — that’s 30 to pass and 36 to override a governor’s veto. Considering all the work that needs to be done to complete the legislation and all the GOP recruiting that needs to happen before the measure has a veto-proof majority, it’s optimistic to think that the bill could be called for a vote before May 31, as Meeks would like.

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The chips may fall, but ...

The Illinois House will convene in Springfield next Monday to debate a major gaming proposal announced in Chicago this morning. Two new casinos, one in Chicago and one elsewhere in the state, could unlock months of political stalemates, according to sponsors Reps. Lou Lang of Skokie and Bob Molaro of Chicago (I heard their press conference on the Internet through Capitol Fax). Or, that same plan could be a dud if it isn’t quickly followed up by separate but related plans to fund road and school construction projects and mass transit and education subsidies.

House Speaker Michael Madigan wrote a letter to legislators and labeled the gaming plan as a “compromise,” but even if all four legislative leaders and the governor agreed on the latest version, there’s a whole lot of back-and-forth that needs to happen before they agree on ways to distribute that money. It’s generally agreed that revenue will be split, with the largest chunk paying for road and school construction projects and the rest for increased education spending. However, Lang said they still have to decide whether the governor or the legislative leaders will have discretion in which projects get funded. And considering trust hasn’t been strong this year, that decision could take a while. In a phone conversation Monday, Lang said, “[The leaders] have yet to come to members and say, ‘Hey, we’re going to get a capital bill. You get X. Where’s your list?’ None of those things have happened yet.”

While Republicans will have this week to suggest tweaks to the gaming legislation, Lang said he’s “very confident” that this proposal or something like it will pass the House. Whether the Senate could support it is unknown. Cindy Davidsmeyer, spokeswoman for Senate President Emil Jones Jr., said in an e-mail that the leadership could support some issues but that it needs to see the actual language before moving forward. She also said session next week is possible, but nothing’s set in stone.

Major parts of the gaming plan include reissuing a legally challenged “10th license” that was previously marked for Rosemont. The plan also would create an 11th license. Chicago would get one of them to build a land-based casino owned by the city and operated by a private investor. All casinos in the state would be governed by a completely new, independent Gaming Board, Racing Board and Director of Gaming Enforcement. They’d work with ethics officers to oversee the bidding process for the two new licenses and manage the nine existing licenses.

Other details include:
- The owners of the two new licenses would have to open 25 percent of their ownership to minorities and women for as little as $5,000.
- The nine existing riverboats would gain a total of 3,500 new positions for a fee.
- The five racetracks would pay a fee to add slot machines.
- The Illinois Gaming Board would have to dedicate $5 million for compulsive gaming programs and kiosks.

If you’re curious about the pros and cons of legalized gambling and about what other states do with the money, check out the analysis provided by the National Conference of State Legislatures.

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Wait for it ... wait for it ...

The worries of Chicago-area mass transit riders, Illinois public schools and human service providers culminated at the state Capitol Thursday, but they were all put on hold for seven to 10 days. Gov. Rod Blagojevich said Thursday night outside of his Statehouse office that he would announce a short-term plan Friday that would save Chicago-area mass transit from severe cuts in services and in payroll.

In those seven to 10 days, Blagojevich said he and the legislative leaders — three of whom stood next to him Thursday night — would urge the Regional Transportation Authority to avoid cutting Chicagoland mass transit services November 4. He said that’s because he and the Illinois General Assembly could tie up major differences in the capital program for road and school construction financed by a gaming expansion. And tying that up would allow for Republicans and downstate lawmakers to approve a mass transit bill primarily for Chicago, he said.

He was joined by Senate President Emil Jones Jr. and the two Republican leaders, Tom Cross in the House and Frank Watson in the Senate.

Quote Blagojevich: “There’s broad consensus among Senate President Jones, Republican Leader Watson, Republican Leader Cross and myself that the practical reality is that in order to solve the mass transit problem long-term for the Chicagoland area, we need an infrastructure, capital construction program to get the downstate members to vote for a Chicago issue and to get the Republican members to support a Chicago issue.”

The missing force was House Speaker Michael Madigan, who arrived late and left early from the leaders’ meeting. Afterwards, Madigan said little other than that the House would wait to hear the governor’s announcement before voting on the mass transit proposal that would increase the regional sales tax and real estate transfer tax in Cook County and restructure the governance of the Chicago Transit Authority.

“We’re going to wait to hear from the governor to see if he has produced more money for another short-term, one-week to 10-day bailout,” Madigan said before walking away.

Downstairs from the leaders’ meeting, Chicago Transit Authority executive director Ron Huberman told a House committee that the agency can’t risk accepting another short-term solution. But that depends on whether he, as well as the mass transit riders and other service providers waiting for state money, believe the governor’s promise that everything will fall into place within seven to 10 days.

Jones said the RTA and the CTA officials will testify to a Senate committee Friday.

Schools held hostage?
One more issue tangled in this mess is state aid payments for public schools.

School districts across the state are still waiting for increases in state aid payments promised to them when the legislature approved a state budget in August. (They’ve been getting their fiscal year 2007 levels since August.) The piece of legislation needed for the state to distribute the new money — including an increase in per-student spending and an increase in reimbursements for special education teachers — is another victim of the political standoff on capital and mass transit funding.

“Enough is enough.” That was the message delivered by state Rep. Roger Eddy, a Hutsonville Republican, on behalf of fellow House Republicans and school superintendents earlier Thursday in a Statehouse news conference.

Without the legislation to release the new money, Eddy said not only will schools miss out on the promised increased funding, but some districts actually will lose money. The Illinois State Board of Education would have to recalculate general state aid payments using last year’s numbers.

“In fact, 726 school districts, as of today, when the calculation is recalculated, will actually receive less money in state aid payments beginning with the November 10 payment,” Eddy said.

For instance, Jeff Patchett, superintendent of Oblong Community Unit School District 4 in east central Illinois, said that his district, which is already on the federal financial warning list, would lose out on $8,571 in state aid per month without legislative action. If the legislation to implement the payments were approved, then the district’s state aid payments would increase by more than $21,000 per month.

Logistically, the House could vote on one ”budget implementation bill” (a.k.a. BIMP) already approved by the Senate. Instead, the House advanced a new, more comprehensive BIMP bill that Democratic budget negotiator Rep. Gary Hannig of Litchfield said is more in sync with the approved budget than the one approved by the Senate month’s ago.

The House and Senate are back in session Friday, and the leaders are expected to meet again. Jones said the leaders could continue to meet in Springfield and Chicago over the next seven to 10 days. Mass transit riders, school officials and service providers will be holding their breath in the meantime.

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Ex-School Board Pres Wants Tax Hike

I really had a hard time believing this comment from former Carpentersville School District 300 Board President Mary Fioretti, which I found posted under a letter to the editor from the Huntley teachers union president in the Northwest Herald:

mary fioretti wrote on May 25, 2007 6:35 AM:

" The legislature, as it always does, tears apart a bill to "fit" their desires. So it's a big guess on what they would glean out of HB750. If it's a 2% increase in income tax multiply that by what you make each year. An income tax credit is available in the legislation for certain income levels."

Let’s see.

We have a three percent income tax on individuals right now.

A 2% increase would make the rate 3.06%.

Think that’s what Fioretti really means?

Or might she mean a two-percentage point income tax increase, which would, of course, be almost a 67% increase in income tax.

The comment above was right below this one:

mary fioretti wrote on May 25, 2007 6:33 AM:

"Dave, to your statements. This is not at all difficult to understand. Just like in any profession or owning a home, you have to acquire basic understanding. Don't let people make you crazy it's about the forumula. Look at the dollar portion of your school tax bill. Multiply that by 20% then do another calculation of 25%. That will be your potential abatement. Remember, not everyone owns a home."

Too bad that Fioretti and her allies at Advance 300 don't understand how to do a cost-benefit study. If the state income tax is increased, this area will not be among the "winners."

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