Thursday, February 15, 2018
Chicago, IL – Yesterday, Bruce Rauner unveiled his fourth unbalanced budget proposal. While Rauner is already out with a new ad lying about his record to Illinois voters, the press coverage has been a little less friendly. Here’s what Illinoisans are reading in the news about Rauner’s unbalanced budget that hurts working families:
From State Journal-Register: Rauner’s Budget Gets Cool Reception From Lawmakers, Opponents:
Rauner’s proposal would shift downstate teacher pension costs from the state to local school districts, a move critics say would lead to property tax increases.
“His last three budgets haven’t been balanced, so I’m not surprised this one isn’t either,” said Treasurer Mike Frerichs, a Democrat. “But for someone who talked about rolling back property taxes, I was a little surprised to hear him advocate what will be the largest backdoor property tax increase in Illinois history.”
Even within Rauner’s own party, the cost shift proposal has caused some concern. For state Sen. Sam McCann, R-Plainview, who also believes the proposed budget is not balanced, the cost shift is a non-starter. […]
Democrat J.B. Pritzker, the billionaire gubernatorial candidate, was more blunt, saying the governor’s pension math doesn’t work.
“(Rauner) should learn the lesson that Dan Biss learned, which is that pensions are a promise and they need to be delivered to the people they’ve been promised to,” Pritzker said. “The Supreme Court overruled Dan Biss, and the governor should understand it’s time to stand up and pay the pensions.”
From Chicago Sun-Times: It’s Turnaround Time For Gov. Rauner – Using Old ‘Roadmap’ To Chart New Course:
The Turnaround Agenda is back.
Gov. Bruce Rauner doesn’t call it that any more, preferring to stress the individual parts over the label that became too closely associated with the state’s long budget impasse.
But as he polishes up his re-election pitch to Illinois voters, Rauner has made clear his ambitious 44-point prescription for curing Illinois’ ills is back on his plate in all its parts from his popular call for term limits to more controversial proposals to curtail the power and influence of labor unions. […]
Arguably, the Turnaround Agenda never really went away, only moved to the back seat as Rauner tried to maneuver through a rocky first term.
From Chicago Tribune: Rauner Budget Proposal At Odds With Re-Election Rhetoric:
As he asks voters for a second term, Republican Gov. Bruce Rauner delivered a budget address Wednesday that was often at odds with what he calls for on the campaign trail.
Candidate Rauner says he wants a freeze on local property taxes, touts changes to increase funding for poorer schools as a key accomplishment and derides the income tax hike lawmakers put in place last year over his veto. But Gov. Rauner, facing pressure to balance the state’s books and live up to his promise to bring savvy financial management to state government, offered a spending plan that undermines much of that platform.
His budget could force local property tax hikes by requiring school districts to pick up the cost of teacher pensions. That move also could wipe out much of the extra money that’s earmarked for schools. And instead of declining to spend the money from the tax hike, it’s integral to his plan.
From Chicago Sun-Times: Rauner Budget Relies On Pension Cuts, Tax Hike He Says He ‘Was Right’ To Veto:
Using funds from an income tax hike he vetoed, Gov. Bruce Rauner on Wednesday said he’d help balance the budget through a change in health insurance benefits for retired teachers and state employees — and a cut to Chicago Public Schools teacher pensions. […]
In his fourth budget proposal — just weeks before a primary election — Rauner is seeking to cut $228 million for Chicago teacher pensions, and $101 million from university pensions.
He’s also proposing the removal of group health insurance for state employees from collective bargaining — a move that will require legislative support that may prove difficult to get.
From Reuters: Illinois Governor Takes Aim At Pensions, Healthcare Costs in Budget:
Illinois Governor Bruce Rauner proposed a $75 billion fiscal 2019 budget on Wednesday that would be balanced if lawmakers agree to push some big-ticket costs onto local school districts and universities. […]
The budget envisions shifting certain education-related pension costs to schools and universities by 25 percent annually over a four-year period.
The shift would cost school districts $490 million in fiscal 2019, with a $228 million hit to the cash-strapped Chicago Public Schools. The Illinois Association of School Boards said this would revoke the promise of higher funding under a school financing law enacted last year.
“With the new pension burden, hundreds of school districts will be receiving a cut in education funding under the governor’s budget plan,” the group said in a statement.
From AP: Rauner: Pension, health overhaul needed to balance budget:
Republican Gov. Bruce Rauner said Wednesday he could balance the Illinois budget and cut taxes by $1 billion provided the Democratic-controlled General Assembly agrees to make massive changes to the pension system and health insurance benefits for state workers.
Besides again advocating for a constitutionally questionable overhaul of employee pensions, Rauner told lawmakers during a budget address that he wants to shift retirement costs to local school districts and dictate health insurance benefits for state workers. […]
Reassigning responsibility for the employer portion of teacher pensions to school districts would reverse a yearslong practice of the state picking up the tab for all districts outside Chicago and was even extended to that city as a matter of fairness in last summer’s education-funding package. […]
The group health insurance changes would mean union employees would no longer be able to bargain for health care, which Democratic lawmakers are almost certain to oppose.
From Decatur Herald & Review: Rauner Budget Proposal May Add To Decatur Deficit Trouble:
City governments across Illinois, including Decatur, won’t get the relief they were hoping for in Republican Gov. Bruce Rauner’s 2019 budget proposal introduced Wednesday, which calls for keeping local shares of state income tax revenue at lower levels for another year. […]
The reason: When lawmakers finally passed a budget last summer after two years of gridlock, cities across the state took a hit. The budget cut their share of state income tax by 10 percent, which amounted to about $1 million in revenue for Decatur. It’s a major component of Decatur’s current $3.2 million deficit.
State law calls for returning those shares to prior levels next year. City officials had hoped that provision would limit bigger deficit troubles.
Instead, Rauner’s recommended budget proposal would create a similar-sized loss to city revenue in 2019.
From DeKalb Daily Chronicle: Superintendents React To Proposed Pension Obligations In Rauner’s Budget Address:
But with DeKalb owing a little more than $3 million annually in Teacher Retirement System payments and the district yet to see the extra funds it was supposed to get from the revised funding formula, things might get tough after the first year.
In a budget address delivered Wednesday in Springfield, Rauner said the shifts will come in 25 percent increments a year. He also promised schools and local governments would have the tools they need to offset the costs, including increased education funding, the power to dissolve or consolidate units of local government and more flexibility in contracting, bidding and sharing services.
Rauner’s plan also calls for state universities, including Northern Illinois University, to cover their own pension and health care costs under a phase-in plan, which would be offset with an additional $205 million for fiscal 2019. Rauner estimates these cost shifts could save state government $696 million in the next fiscal year.
From McHenry County Northwest Herald: Some McHenry County Education Officials Concerned About Gov. Bruce Rauner’s Pension Plan:
Leslie Schermerhorn, McHenry County’s regional superintendent of schools, said it’s questionable that there would be any advantage to the plan to pass pension costs to local school districts.
“We can’t eliminate the pensions. So far, the courts have upheld that,” she said. “By passing down pension costs, we are affecting the budgets of the schools, and this will probably end up being passed down to the taxpayers.”
Former Huntley School District 158 Superintendent John Burkey, who now is executive director of the Large Unit District Association, said the proposal to shift pension costs to local schools is alarming.
“I agree that it’s critical that we get our fiscal house in order, and I think what Rauner said about us [needing to be] more competitive compared to surrounding states is true,” he said. “But a part I am very concerned about is the pension shift.”
Not many local school districts will be able to absorb the pension costs without cutting programming or raising property taxes, Burkey said.
“Pension laws were made, and benefits are given by the state of Illinois,” he said. “I believe the state of Illinois needs to bear the responsibility for them.”
From NPR Illinois: On Income Tax, Rauner’s Budget Plan Doesn’t Match Campaign Rhetoric:
When out campaigning, Governor Bruce Rauner has been making big claims about lowering taxes. But there was little follow-through in Wednesday’s budget proposal.
Just last week, Rauner told Sangamon County Republicans not only would he work to block a progressive income tax, but he’d try to get taxes “down lower from where they are today, and bring them back down to 3 percent over the next two years.”
The budget proposal made no mention of 3 percent and no mention of two years.
From State Journal-Register: Reactions to Gov. Rauner’s Budget Address:
A collection of reactions to Gov. Bruce Rauner’s budget address on Wednesday.
“After three years of crisis and destruction, Bruce Rauner’s proposed budget will continue to devastate Illinois’ working families. Today, we saw a failed governor propose another unbalanced budget as he doubles down on his all-out assault on workers and the social services they need to build better lives. Bruce Rauner desperately ripped a page from Daniel Biss’ playbook, attempting to balance the budget on the backs of public servants by slashing their hard-earned benefits in a potentially unconstitutional scheme. At the same time, Rauner’s budget would have a devastating impact on childcare services, programs for the developmentally disabled, and mental health services, further decimating a social safety net Rauner has relentlessly attacked. As governor, I will provide real leadership and vision to bring our state together and clean up the damage Bruce Rauner has done.” — J.B. Pritzker, Democratic candidate for governor
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