September issue: Out with the Old — NCLB

Check out the September edition of Illinois Issues magazine.

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

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

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

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

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

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

Read more...

May issue: A break from the past

Read the latest Illinois Issues magazine to see how Senate President John Cullerton is "reigning in the Senate." The Democratic leader has revived a bipartisan spirit, but how long that lasts depends on upcoming polarizing votes.

Also read what's at stake when the federal government takes its census of Americans.

And learn how Illinois is waiting for the federal government's signal about whether "clean coal" technology is worth the risk.

Available in the print edition only are stories about Illinois' infrastructure needs and costs, as well as the push for legalization of medical marijuana.

Read more...

Alternative transportation

By Jamey Dunn
A transportation and business group is proposing what it says is a more specific plan than Gov. Pat Quinn’s proposal for major construction plans for roads, bridges and transit.

Sen. Martin Sandoval, a Cicero Democrat and chairman of the Senate Transportation Committee, came out in support of the Transportation for Illinois Coalition’s proposed capital plan today. The coalition claims the plan calls for more state money than Gov. Pat Quinn’s proposal for a capital plan, but almost $10 billion less than the coalition says the state should be investing in its infrastructure.



According to a 2006 study commissioned by the Transportation for Illinois Coalition, the unfunded need for Illinois transportation projects exceeds $23 billion. That number has not been adjusted for inflation. Linda Wheeler, a transportation consultant for the Transportation for Illinois Coalition, said the findings mirror the Illinois Department of Transportation’s estimates of the unmet needs.

In an attempt to be more realistic about the state’s budget restraints, the coalition has since pared that number down to a $13.5 billion “minimally adequate” plan. Michael Kleinik, Transportation for Illinois Coalition co-chair, said, “There is little money for expansion in this proposal, but it does bring us closer to where we need to be.”

Wheeler said that Quinn’s proposed budget is not specific enough about how much state money would go toward transportation and that it uses some creative accounting techniques. She said that some of the money that is listed as highway funding actually would go toward debt service on bonds.

Sandoval said he wants to fund the alternative plan with a motor-fuel tax increase, which he said has support in the Senate. However, he said he supports a higher increase than a version proposed in the House, which seeks an 8 cents per gallon increase. Sandoval said that he thinks there is little to no support for Quinn’s proposal to spend part of the money from an income tax increase to fund a capital plan.

While Sandoval had the backing of business groups, labor unions, transit officials and transportation experts, he was the only legislator making a pitch for the coalition’s proposal.

Sandoval urged swift action to hammer out a plan that could find enough votes to pass. “We are at a crossroads literally and figuratively here in Illinois, and if we don’t get it right today, I don’t know if we ever will.”

Many of the speakers who addressed the Senate committee this morning raised concerns that too much squabbling in Illinois over a capital plan could hurt the state’s image in Washington, D.C. and possibly damage its ability to seek increased federal funding in the future.

“It’s not lost on me, and I think it’s not lost on anyone in Washington who follows what’s going on in the states, that Illinois has struggled to come to terms with what it needs to do in the long term,” said Janet Kavinoky of the U.S. Chamber of Commerce. “But, the longer you debate and discuss and struggle with who’s going to invest in what, and who’s going to get credit for what, … it appears chaotic.”

Read more...

"Trifecta" heads to the governor

The House on Thursday night nearly unanimously approved the $9 billion plan for federal stimulus funds, transportation projects and supplemental spending for state operations. The Senate approved the package earlier in the day. The spending plans now head to Gov. Pat Quinn’s desk, satisfying the governor’s request for the General Assembly to approve a small version of a capital plan for roads and bridges before lawmakers left on a two-week spring break.



House Republicans early in the day weren’t on board because it wasn’t clear how the money would be spent, said House Minority Leader Tom Cross. However, working with Quinn’s office throughout the day, he said his caucus finally got a list. “The governor was very helpful, both himself personally and his staff, in trying to make this happen,” he said.

“Today’s actions are a great example of what we can accomplish when we come together with a common purpose,” Quinn said in a statement.

Senate President John Cullerton, however, foreshadowed the difficulty in securing the three-fifths majority needed to do a larger capital program based on tax and fee increases later.

Cigarette tax advances
By Jamey Dunn
A timely example of that difficulty in advancing any tax increase occurred early in the evening. After missing the mark by one vote the first time, a $1 sales tax increase on each pack of cigarettes advanced through the Senate Thursday when a second vote was taken.

Senate Bill 44, which would phase the tax increase in over two years, had 29 in favor, 28 opposed and one voting present. It took a last-minute, closed-door meeting between Cullerton and House Speaker Michael Madigan before the vote was retaken, resulting in the 30 votes needed to pass. Twenty-six members still voted against it.

Cullerton said that the bill has support from Madigan and Gov. Pat Quinn, but he added that the close vote indicates a difficult road ahead for future tax increases. “This was the first bill that required people to actually vote for a tax,” he said. “And you can see it’s not easy for people to do that. Unfortunately, we’re probably going to have to do a lot more.”

The bill heads to the House, which will reconvene Friday morning. The Senate finished its business and headed home for spring break.

Read more...

"Trifecta" spending plan on its way — UPDATED

By Bethany Jaeger
UPDATE: The Illinois Senate unanimously approved the $9 billion package to release federal stimulus funds, state bonds for road and transit repairs and supplemental spending for state operations. Senate Minority Leader Christine Radogno applauded the "true bipartisan cooperation" it took to get there. The package now heads to the House, which can either accept or reject it. It won't be able to change it.

ORIGINAL POST: The Illinois Senate this morning advanced a spending plan worth slightly more than $9 billion that is designed to jump start the flow of state and federal dollars for construction plans, state operations and federal stimulus programs.


Democrats and Republicans in a morning Senate committee applauded the plan as a “good first step” toward a bigger capital plan for road and school construction projects, but that’s tied to a string of potential and controversial funding sources, including tax and fee increases.

Before hopping on board, Republicans sought a provision to ensure that the money would flow based on an existing five-year transportation plan, not based on political preferences. Senate Minority Leader Christine Radogno said during a morning committee that given the distrust between the legislative and executive branches during the last few years of former Gov. Rod Blagojevich’s administration, Republicans wanted assurances. This really kind of puts a public face on the private conversations that have been going on,” she said, adding that the plan was a “very good, positive step forward” for Illinois.

Senate President John Cullerton said: “We let the engineers decide, not the politicians. It has nothing to do with Blagojevich or past scores to settle. We’re just trying to do it on the square.”

For instance, $150 million would be doled out based on a traditional formula, where Chicago-area districts get 45 percent of the funding and downstate districts get 55 percent of that funding. Another sum of $450 million would be distributed based on an existing five-year plan for construction projects, which Illinois Department of Transportation engineers rank by another formula.

Labor groups represented by the AFL-CIO and some operating engineers support the plan; however, one Springfield-based chapter of the operating engineers union opposes it because the state-funded capital plan would only designate $8 million to the central Illinois district that includes Sangamon County. But Cullerton pointed out that the central Illinois district would get $54 million of federal stimulus funds.

Federal stimulus funds will distribute money for everything from weatherization to education. However, the plan advanced by the Senate today would take some money out of the portion that would have gone to public education and use it for state operating expenses. Then the state would use incoming federal stimulus funds to eventually backfill the amount for education. According to Sen. Donne Trotter, chief budget negotiator for the Senate Democrats, education, in the end, would come out about even. That is, after all, the intent of the federal stimulus, he said.

“The stimulus package was never intended for us to grow anything. It was to ensure that we didn’t have to cut anything, and that’s what we’re utilizing those dollars for.”

The full package now heads to the full Senate, where a vote is expected this afternoon. If approved, it would head to the House later today or tomorrow.

Here are some more highlights of the “trifecta,” dubbed by Trotter:

Federal stimulus funds = $6.7 billion

• $1.7 billion to pay down the state’s Medicaid bills, including an enhanced federal reimbursement rate of about 61 percent for 27 months.
• $500 million for high-speed rail.
• $300 million for a Chicago-area project to reduce freight and vehicular traffic congestion.
• $285 for Amtrak improvements.
• $40 million for transit.

Other funds are earmarked for low-income housing, developmental disability and mental health services, programs for women and children, youth services, criminal justice and domestic violence grants, weatherization jobs and training, environmental protection, water treatment and education.

Read more in Illinois Issues this month.


$3 billion state bonding program for transportation projects

• $2 billion bonded from the dedicated Road Fund to repair roads and bridges.
• $1 billion bonded from the state’s general fund for transit maintenance projects.
• $150 million for emergency pothole repair on state and local roads.
• $40 million for Chicago-area transportation agencies to release funds that previously were suspended under a previous capital program.

Supplemental spending for FY09 operating budget = $109 million

• $363 million to reopen closed historic sites through June 30.
• $25 million for services for women and children, capturing more federal matching funds.
• $20 million for flood relief.
• $10 million for line-of-duty awards.
• $6.7 million for court reporters.

Read more...

Mini-capital plan coming Thursday

By Bethany Jaeger
State lawmakers are expected to vote tomorrow on a “mini-capital plan,” which would drive $2 billion into crumbling roads and bridges and $1 billion into mass transit as part of a five-year transportation program, relying on bonding and transfers from existing state funds. The plan is being framed as a precursor to a more robust capital plan that would rely on new revenues through driving-related fees and, potentially, tax increases. But some fear enacting a mini-capital plan now could slow the momentum for a larger plan later.




Illinois Department of Transportation Secretary Gary Hannig, former deputy leader for House Speaker Michael Madigan, said this afternoon in the Statehouse that the mini-capital plan would go toward maintaining and fixing existing roads and bridges, not paving new ones.

“Right now, the conditions of our roads as rated by the engineers is about 76 percent, which most people would say is not good,” he said. “Within the next five years, we want to take the conditions of the roads … and bring them up to 90 percent.”

Spending money on existing roads, however, would not tap into federal highway funds that have been waiting a long time for a state match. Hannig added that the proposal would include an emergency plan to fill potholes on some state and local roads.

While Sen. Martin Sandoval, a Chicago Democrat who chairs the Transportation Committee in his chamber, said he would vote to support the mini-capital plan, he said it would be a minimal investment that drastically undercuts the funding needed for mass transit.

There’s been a longstanding agreement that for every $1 spent on mass transit, the state would spend $2 on roads and bridges. Sandoval wants to change that so the state would spend an equal amount on each. He cited a five-year plan to dedicate about $5.5 billion for roads and bridges and another $5.5 billion for transit.

“Now is the time to do it right,” Sandoval said in a Statehouse news conference this afternoon. “Doing it in a half-step method today is the wrong way to go.”

To generate some more money that could shore up funds for mass transit, he supports the idea to increase the state’s motor fuel tax by at least 8 cents a gallon. That’s currently proposed in HB 1. Yet, Sandoval said that a motor fuel tax increase, alone, wouldn’t be enough. It would have to be coupled with Quinn’s proposed increases in driving-related fees, as well as federal funds.

Brian Imus, state director of the Illinois Public Interest Research Group, added that the Illinois Department of Transportation could use some of the $1.4 billion of federal stimulus funds for mass transit, but the department has not planned to do so. (We wrote about mass transit advocates last week.)

Transportation Department spokeswoman Marisa Kollias said the agency decided to put all federal “highway investment” funds into highways rather than into transit. “There are needs in both programs, and we chose to use the limited funds to address road and bridges,” she said in an e-mail.

Sandoval’s push for more mass transit money will come up again the week the legislature returns from its two-week spring break. He said he plans to schedule a public hearing in Springfield to discuss a $13.5 billion capital plan called for by labor and business officials of the Transportation for Illinois Coalition. That $13.5 billion, however, also doesn’t include a specific funding source. The coalition offers general ideas here. The coalition did send letters today to the governor and to lawmakers to say its members supported the mini-capital plan.

Read more...

Transit and taxpayers

By Bethany Jaeger
Mass transit advocates say Gov. Pat Quinn’s proposed capital program needs an overhaul and relies on “fuzzy math,” and they look to an increase in the state’s motor fuel tax to help pump more money into transportation projects.


Quinn said this week that he wants to see the start of a capital program approved by the legislature by April 3. “I think it should be for roads, bridges and public transit. We shouldn’t forget that one of the key things of reducing our reliance on petroleum and foreign oil is having good public transit, as well as improving our roads and bridges.”

Yet, his proposal to provide about $4.6 billion for mass transit systems over five years doesn’t satisfy Chicago-based civic organizations. They said that Quinn’s plan relies more on federal funds and matching grants, including only about $1.5 billion in new state spending for transit.

“It’s not even enough money to cover the basic maintenance and repair needs to keep the [Chicago] region’s transit network in its current condition, much less to upgrade the transit network,” said Brian Imus, state director of Illinois Public Interest Research Group. He joined leaders of Chicago Metropolis 2020 and the Metropolitan Planning Council today in a teleconference.

Given the economy, a business and labor-based group called the Transportation for Illinois Coalition recently reduced it’s request for transportation infrastructure from $23 billion over five years to $13.5 billion over five years, but that would only fund a “minimally adequate, maintenance- and safety-focused program.”

To reach the $13.5 billion, it would take about a 13-cent increase in the state’s motor fuel tax, said Chicago Metropolis 2020 Vice President Jim LaBelle. The motor fuel tax has been 19 cents a gallon since 1990. If it were adjusted for inflation, it would be about 32 cents, he said.

Quinn, however, opposes the motor fuel tax increase. The idea has support from Senate President John Cullerton, and the House currently is considering HB 1, which would increase the tax by 8 cents a gallon.

LaBelle said his organization would support a motor fuel tax increase if it were accompanied by reforms to the way the state prioritizes construction projects and distributes the money. The group supports HB 2359, Rep. Kathy Ryg’s bill that we wrote about earlier this week. It would create regional transportation policy groups to advise the Illinois Department of Transportation when ranking projects.

Peter Skosey, vice president at the Metropolitan Planning Council, agreed with the need for a new planning process. “We for too long have spent our dollars based upon arbitrary geographies and political clout and less upon strategic investments.”

Watch whether Ryg’s measure combines with Rep. John Bradley’s 8-cent increase in the motor fuel tax to create a new revenue source, as well as a new way of distributing that money to transportation projects.


The state's TAB
By Jamey Dunn
The state’s new Taxpayer Action Board, created by Gov. Pat Quinn by executive order, held its first meeting today. The board plans to explore only ways to reduce spending, not ways to find new revenue sources, according to Tom Johnson, chairman of the new board and president of the Taxpayers’ Federation of Illinois. (He’s also a former director of the Illinois Department of Revenue during Gov. Jim Thompson’s administration.)

The board is supposed to make recommendations by May 22, nine days before the state constitutional deadline for the General Assembly to adjourn for the summer.

The board is charged with proposing ways to streamline government operations to save money, particularly for Medicaid, education, human services, as well as pensions and health care benefits for state workers.

The board is comprised of former lawmakers, policy experts, educators, business leaders, tax experts and individuals from health care and human services. Organizations such as the Metropolitan Planning Council and the Illinois Farm Bureau also have members on the board.

Jerry Stermer, Quinn’s chief of staff, said at the meeting that the board was formed to get a new perspective on the state’s deficit from people who represent their communities. “Maybe we’ve asked some of these questions before, but let’s ask them again. Let’s ask them in a different way, and let’s see if there are some redesigns, some reshuffling of the deck,” he said.

The state Senate also formed a special Deficit Reduction Committee, which issued a bare bones report with pages of testimony but few recommendations after four weeks of public hearings. See more here.

Read more...

Countdown to capital begins

By Bethany Jaeger and Jamey Dunn
Gov. Pat Quinn wants at least a portion of his statewide plan for major construction projects approved by the General Assembly before April 3. That’s the last session day scheduled before legislators are supposed to head home for a two-week spring break, and Quinn reportedly said today that he thinks they should bypass spring break to work on a capital plan.


The $26 billion plan, called Illinois Jobs Now, eventually would fund infrastructure, mass transit, railroad improvements, new school buildings, housing, conservation projects, and water treatment projects. Two new projects also would include an airport near Chicago’s south suburbs and the construction of the first veterans’ home within Chicago.

The proposed funding mechanisms, as usual, spark controversy. If Quinn’s budget plan were approved, vehicle-related fees would help fund road and bridge construction. (Driver’s license fees would increase from $10 to $20; license plate fees would go from $79 to $99; and vehicle registration fees would rise from $15 to $30.) Mass transit projects would be funded by title transfer fees, which would increase from $65 to $105.

Plans to build new schools, then, would be funded by shaving a portion of tax revenues typically given to local governments.

In addition to federal stimulus money, Quinn also proposes using about $150 million a year from the state’s dedicated Road Fund. That would allow the state to bond/borrow money to pay for projects specifically for roads and bridges.

That’s one portion of a capital plan that could be done by April 3. Senate President John Cullerton said it could be realistic for the legislature to approve increasing the amount the state may borrow for the purposes of kick-starting a road program and tapping into federal matching funds.

The part of the capital plan that will take the longest to negotiate is other sources of funding, especially if it's intertwined with an attempt to increase the state income tax rate or motor fuel tax rate. For instance, Cullerton said he still supports the idea of increasing the state’s 19-cent tax on each gallon of motor fuel, which hasn’t changed since 1990. He describes the motor fuel tax as a traditional way to pay for roads, and because it’s a so-called user fee, people could adjust their lifestyles if they didn’t want to pay more. (Senate Democrats are working on a plan that would increase the tax by about 16 cents, while the House is considering a bill to increase the tax by 8 cents.) According to Cullerton, an 8-cent increase could generate $500 million.

Sen. Martin Sandoval, a Chicago Democrat who chairs the Transportation Committee in his chamber, agreed that an increase in the gasoline tax has support in the legislature and would fund a “robust” capital plan. He’s sponsoring SB 200, which doesn’t have language, yet, but could be used to advance a motor fuel tax bill.

Sandoval is one critic of Quinn’s capital plan because, he said, he’s concerned it would be unfair to Chicago. “Mass transit takes a huge hit at a time when we’re preparing for the Olympics, at a time when we’re trying to protect the environment, at a time when we’re trying to put people back to work. Gov. Quinn is going in the wrong direction when it relates to mass transit.”

Under Quinn’s proposed budget, the Chicago-area Regional Transportation Authority would lose $32 million in grants for operating assistance. Public transportation also would lose about $42 million, but that’s based on decreased sales tax revenues. Downstate transportation districts, on the other hand, would see an increase of about $24 million.

Jennifer Morrison, managing director of the Transportation for Illinois Coalition, said that her organization was encouraged by Quinn's emphasis on a long-awaited capital plan but that the funding for mass transit, highways and local roads would be “way too small to make any meaningful impact.” She added that the budget plan is “more than a little unclear” about which revenue sources would be designated to which projects.

While neither Senate Minority Leader Christine Radogno nor House Minority Leader Tom Cross supports Quinn’s fee increases, they said last week that they do hope to meet with the governor to work out a compromise.

Another part of the plan that will take a long time to negotiate is how the money would be distributed throughout the state. Not only could it differ depending on the source of revenue approved by the legislature, but it also could change if Democratic Rep. Kathleen Ryg of Vernon Hills has her say.

She wants the planning process to empower local stakeholders through various metropolitan planning organizations. House Bill 2359 would create a new advisory committee to the Illinois Department of Transportation when prioritizing road projects. Ryg said the new committee would help assure taxpayers and state officials that the limited amount of money available would be spent on the best use, particularly as a capital bill is drafted and new revenue sources are generated.

The recent appointment of Transportation Secretary Gary Hannig, a former state representative and budget expert for House Democrats, actually could help the measure advance. Ryg said this afternoon that she changed her bill from its original form in response to concerns expressed by Hannig shortly after his transition from the legislature to the state agency. Now Ryg's bill would ensure more representation for all areas of the state, including those that don't have metropolitan planning organizations.

Her bill also would change the way projects would get funded. Currently, engineers distribute money based on such factors as the condition of roads, the traffic flow and the population served. Ryg said her bill would fund the greatest maintenance needs first, and then the regional groups would advise the Transportation Department on other local needs. All areas of the state would be evaluated under the same set of new criteria.

Regardless of which revenue sources the General Assembly ultimately agrees upon, the influx of money has some legislators nervous about whether their districts will benefit. So watch for the concept in Ryg’s bill to serve as a potential “accountability” measure, meant to assure legislators that, at the least, their areas would be represented in the decision-making process.

Read more...

Trust issues???

Crain's says that Mayor Daley wants to get any money for roads in his hands and not the governor's?

Mayor Richard M. Daley is lobbying to keep Gov. Rod Blagojevich's mitts off several hundred million dollars Chicago is poised to get through a proposed economic stimulus package under debate in Congress.

Historically, almost two-thirds of federal road funds go to metro areas, where locals decide how to spend them. But Mr. Daley and other U.S. mayors and local officials are worried that Congress will shift highway project decisions to the states in an attempt to simplify the process and create jobs more quickly.

"This is creating a great deal of heartburn," says Robert Fogel, senior legislative director for transportation at the Washington, D.C.-based National Assn. of Counties. "There's no guarantee that counties or cities will see one cent of the money for work on all of our many ready-to-go projects."

The impact on Chicago is potentially dramatic. Under a recent House-passed, $60.8-billion stimulus bill, Illinois would receive $436.8 million for highway projects, with no money set aside for Chicago.

Well this isn't a big surprise that officials in Illinois don't trust the governor to divy out public funds accordingly.

Read more...

Which way?

The first time a state legislative panel has gone this far in carrying out a statutory process for closing a state facility isn’t a pretty one. Whether intended or not, one Illinois town has been pitted against another after Gov. Rod Blagojevich in June proposed moving about 140 Illinois Department of Transportation positions from Springfield three hours south to Harrisburg.

It was easy to see the tension during a lengthy public hearing in the state Capitol building Thursday night. A packed committee room literally was divided. Harrisburg residents sat on one side in purple T-shirts encouraging people to visit the southern Illinois town. Springfield state employees sat on the other side in lime green T-shirts saying the move is the “wrong way.” More supporters and opponents overflowed to the floor below, where they sat in folding chairs lined up in two more hallways and watched the committee hearing on giant screens.

The dilemma facing the Commission on Government Forecasting and Accountability, the panel overseeing the process, is muddled. Facts have been complemented, and sometimes contradicted, by politics and emotions in the past few months.

Union-backed employees repeatedly have shared personal stories, including having to leave a grandmother with Alzheimer’s disease in a nursing home, forcing a teen-age son who lives between his mother’s and father’s homes to decide between the two and challenging people with disabilities who have support networks and medical experts in Springfield. The governor's office has said employees can choose to stay in Springfield and take jobs with equal pay and equal benefits, although the employees are skeptical.

Harrisburg officials said they feel left out and overshadowed by Springfield. “We’re depressed, not stupid,” said Harrisburg Mayor Valerie Mitchell.

They’re both victims, one set to lose either way. The motivation behind the move is the most contentious point, particularly whether the idea is rooted in economics or in politics.

GOP legislators representing the Springfield area allege the governor’s proposal was retribution for supporting a measure that would allow voters to recall elected officials, a measure perceived to be directed at the governor. Local officials list various state-owned facilities in Springfield that have space and could house the division. “We can move them a block or two and not 200 miles,” said Rep. Raymond Poe, a Springfield Republican, during the hearing.

The administration refutes the allegation and says the move is intended to give a boost to an economically depressed area of the state.

Sen. Christine Radogno, a Lemot Republican, said this proposal fails to consider economic development through private investment or tourism funding. Having spent the morning in Chicago at a leaders’ meeting about a statewide capital plan that would encourage such development, Radogno said during the hearing: “Guess what. It ain’t happening. It is so dysfunctional, the governance of this state, that we’re reduced to talking about economic development in terms of moving jobs around.”

“I want to help you,” she said to local Harrisburg officials, “but I’m not sure that, just again, moving government jobs around should satisfy us that we’re doing adequate economic development. That’s not economic development.”

Secretary of Transportation Milton Sees testified that it all started because of the need to replace old carpet nearly two years ago. Rather than continue to pay for an expensive lease to a California owner to house the Division of Traffic Safety, the department looked for ways to save money once the lease expired. Shortly after, Sees said the governor directed him to find a division that could serve in a stand-alone facility and relocate to an economically depressed area of the state. The focus shifted from finding space in Springfield to determining whether the Division of Traffic Safety could relocate to southern Illinois, eventually leading to Harrisburg. “They are starving for jobs, literally,” Sees said.

The transportation department already signed a contract to purchase space in the Harrisburg facility for $812,000, using money from the state’s dedicated Road Fund. IDOT’s chief counsel Ellen Schanzle-Haskins added that the department could break that lease at any time with five day’s notice. She also said the purchase is frozen until after the Commission on Government Forecasting and Accountability issues a recommendation, due September 11. The recommendation, however, is not binding. The governor could move the positions, anyway.

Read more...

Are smaller bites easier to digest?

The waiting list of construction projects isn’t getting any shorter, and the cost of gas and materials isn’t getting any cheaper, so any talk of a statewide capital plan to fund those projects is important. But frustration can worsen when the Illinois House and Senate and the governor’s office seem so far away from making any kind of deal but continuously promote their own plans and try to make the others look bad.

Most recently, the House Democrats are taking this approach: If you can’t get a $34 billion capital plan for road and school construction projects done, then at least try to capture nearly $2 billion of the federal funds that are earmarked for Illinois but that are vulnerable if Illinois fails to act.

House Democrats this afternoon advanced measures that would attempt to capture $1.8 billion in federal funds designated for some Illinois infrastructure projects. (For those who like details: SB 1116 and SB 1460 would allow the state to issue $360 million in bonds to pay for the projects over many years. The state would have to repay the debt in increasing amounts every year, starting with about $2 million the first year and $20 million down the road.)

The governor’s office wasn’t too pleased with the plan, as indicated by this statement offered in an e-mail: “The House move puts us 1 percent closer to meeting our state’s infrastructure needs. Before the House starts pounding their chests and congratulating themselves, it’s our hope that they go back to work and pass the other 99 percent necessary to meet our infrastructure needs and create thousands of jobs.”

Proponents of the capital construction plan for Illinois compiled by former U.S. House Speaker Dennis Hastert and Southern Illinois University President Glenn Poshard often say the state could lose out on money sitting in Washington if Illinois doesn’t provide its share (the feds pay 80 percent; the state pays 20 percent).

The House Democrats are trying to send a signal to the feds that Illinois has the money ready to go to fund the projects most at-risk of losing the federal funds, said Rep. Gary Hannig, a Litchfield Democrat sponsoring the measure [emphasis added]. “This would allow us to make our 20 percent payment. In turn, we would expect the federal government to then come up with the 80 percent. But these are projects that our congressmen have determined and earmarked in a federal transportation bill.”

Steve Brown, Democratic spokesman, said the measure aims to bring in $1.2 billion for highway projects and $600 million for mass transit projects. He said House Democrats proposed those amounts in response to information from the Illinois Department of Transportation about the federal dollar amounts at risk without a state match. But IDOT couldn’t confirm that information or interpretation of the situation. Department spokesman Mike Claffey said IDOT didn’t have a comment but was looking into the legislation.

And as Hannig said, no one really knows when the federal earmarks will expire. “I think the view is that the sooner we try to access this money, the better, clearly.”

If the couple of measures won House approval, it still would need to pass the Senate. “If it passes, we’ll take a look at it when it gets here,” said Cindy Davidsmeyer, spokeswoman for the Senate Democratic leadership.

Read more...

The puzzle gets another piece

The Senate unleashed its $16 billion pension deal tonight in a tense but brief hearing. The House did not include a pension package in its series of budgets approved yesterday, indicating a rough road ahead for the plan that the governor has tried for two consecutive years.

The governor achieved a $10 billion pension deal in 2003, and higher than expected savings resulted. This time, market forces change the equation a bit.

Sen. Don Harmon, an Oak Park Democrat, said the deal would take care of the next payment and reset a payment cycle set in 1995 for state contributions. The goal is to knock down Illinois’ $42 billion pension liability 11 years earlier than scheduled.

It’s “similar but not identical” to the plan floated in 2003. Gov. Rod Blagojevich secured a lower interest rate and generated money that could pay down the ballooning liabilities. But the plan had a twist. While it still ramped up payments in future years, the General Assembly allowed the governor to pay the required amount that year and then skip $2.3 billion in state contributions in fiscal years ’06 and ’07.

Harmon said this deal would only go into the state's five pension systems and would not include a “pension holiday.” Instead, he said it would ease the budget deficit. “It’s less money we don’t have.” He also said it would result in a $55 billion savings over the life of the bond issuance and allow a more manageable and regular payment schedule through 2038.

Senate Republicans on the committee, including Sen. Bill Brady of Bloomington, said the state still has the same unfunded obligation, $42 billion, and adds to its bond debt that it still has to repay. Counter to Harmon, Brady said the proposal would undercut the state’s payment by $500 million. If the state did nothing, the schedule calls for a $3.3 billion payment next fiscal year. Under the proposal, Illinois would contribute $2.8 billion, Harmon said.

Tension mounted as vice chair of the committee, Sen. Michael Noland, an Elgin Democrat, kept trying to cut off debate to avoid dramatics. It didn’t work, and Harmon invited more questions. In the end, Republicans walked out of the room to protest the 15-minute debate on a $16 billion proposal.

The Taxpayers’ Federation of Illinois opposes the new proposal because it lacks pension reforms that the group has called for for numerous years. The measure also pushes back the ramped up payments until later and sparks concern when playing with a significant amount of state dollars in the stock market, said David Eldridge, the group’s legislative director. In other words, there’s no guaranteed savings that the state achieved in the 2003 deal.

Some common ground
By Patrick O’Brien
Earlier Thursday, a Senate committee moved the budget proposals for 69 state agencies, including the Department of Natural Resources and each statewide executive office. According to Sen. Donne Trotter, a Chicago Democrat and point person on the budget, most agencies would receive little or no increase over last year’s funding.

One notable exception is higher education. The House and Senate proposals are almost identical. State universities would receive a 2.8 percent increase, which follows years of stagnant funding or decreases.

The Senate’s higher education budget was a “very optimistic sign,” said Rep. David Miller, a Chicago Democrat. “There’s going to be some changes at the end, but we’re not simply starting from scratch.”

IDOT: It’s that bad
By Bethany Jaeger
The Illinois Department of Transportation will spend a majority of $10.9 billion on fixing existing bridges and repairing old roads during the next six years. It’ll spend a fraction, $633 million, on building new roads. Milton Sees, transportation secretary, said in a Statehouse news conference Thursday that lower-than-expected motor fuel tax revenues and increased costs of materials means state dollars buy less than they did a few years ago.

He said, it is that bad. “We continue to struggle with deteriorating roads, urban congestion problems and [miss] rural economic growth opportunities as a result of the situation we find ourselves in.”

The department has felt the effects of higher gasoline prices as drivers find ways to reduce their consumption, whether it’s by buying hybrid vehicles or just not driving as much, Sees said. And because the motor fuel tax is a flat amount per gallon, it doesn’t increase with the price of gasoline. “So as consumption goes down, our revenues decline along with that.”

According to Dick Smith, IDOT’s director of the office of planning and programming, the motor fuel tax usually generates about $1.2 billion a year. So a 1 percent decrease expected for the current fiscal year translates to about $12 million. The department expects only about 1 percent growth in revenues during the next six years, as well.

The $30 billion infrastructure program announced by the governor’s capital coalition Tuesday, would help, and Sees called it “doable.” (The six-year plan released Thursday does not depend on the approval of a pending capital plan.)

Sees said there is a specific list of projects that would be funded under a capital plan, but it’s a “working document that’s not ready for release.” He did say the projects would include adding lanes to relieve traffic congestion and building new interchanges along the state highway system. It also would provide some much-needed money for resurfacing projects that otherwise wouldn’t get attention in the six-year plan.

‘Pay to play’ may be voted on Friday
By Patrick O'Brien
The ethics measure that seeks to divorce state contracts from political contributions to officeholders may see a vote on the Senate floor Friday, according to Harmon, who also is sponsoring the reform package. He said Thursday night that he believes the plan would pass the House if it makes it out of the Senate first. A last-second change to include nonprofit groups cleared a Senate committee today, and Harmon said the bill won’t be further altered.

Read more...