Illinois Gov. Bruce Rauner lost an unprecedented battle with the “Springfield insiders” he once campaigned to dethrone when lawmakers approved a budget deal and $5 billion tax hike over his objections, and without the pro-business reforms the Republican promised for years.
Now the question is “whether the outcome of the more than two-year budget impasse will help or hurt the wealthy former businessman when he asks voters for a second term in 2018 ?”
Rauner, who last year deposited $50 million into his political fund, already was facing a particularly difficult re-election in a place where voters typically elect Democrats to statewide office. A growing list of Democratic contenders with access to equally massive campaign accounts have lined up to oppose him, and Democrats and other liberal groups nationally are spending money and calling him one of the country’s most vulnerable incumbent GOP governors.
Is it enough to say, ‘I worked hard for you. I couldn’t get it done, but keep me and I’ll keep working at it?’ Or does he look like an ineffectual bumbler that’s driven the state into the toilet?”
In my opinion the scenario that played out when lawmakers overrode his vetoes of the tax hike and spending plan could be a political gift for Rauner, who gets to take advantage of about $5 billion in new state revenue without having supported it.
Next week he’s expected to hold campaign-style events where he’ll portray himself as the defender of taxpayers and point blame for the stalemate and new tax hike at his chief political rival, longtime House Speaker Michael Madigan, who leads the Democratic Party of Illinois. Rauner also will have millions to do the same on television, and to link his rival to Madigan in campaign ads.
Mike Madigan is going to own the tax increase and it’s very difficult to win elections when your main accomplishment is you raised income taxes.
Rauner said throughout the impasse that he wouldn’t support an income tax increase to help balance the budget unless he got some changes to improve Illinois’ business climate and give other relief to taxpayers, such as a property tax freeze and reduced workers’ compensation insurance costs. Democrats resisted, saying his agenda items would hurt working people and that a property tax freeze would hurt school districts that rely on that revenue.
With the two sides unable to agree on a budget, the state continued to spend billions more than it was taking in, due to court orders and state law mandating some payments.
Illinois racked up about $15 billion in unpaid bills, college students left the state because of cuts to higher education and social service agencies were forced to cut programs and staff or close entirely. Illinois also saw its credit rating downgraded multiple times, and ratings agencies warned as the state entered its third fiscal year on July 1 without a budget that Illinois could be the first U.S. state to be lowered to “junk” status.
The mounting pressure prompted 15 Republicans in the House and one in the Senate to break ranks and vote with Democrats for a $36 billion spending plan that relies on a permanent income tax increase. Rauner vetoed the plan, but enough Republicans remained “yes” votes to help Democrats complete an override.
Among the more than half a dozen Democrats vying to challenger Rauner are billionaire businessman J.B. Pritzker, one of the country’s wealthiest men, and Chris Kennedy, the nephew of the late President John F. Kennedy.
On Friday, Pritzker’s campaign began automated phone calls to voters, which accuse Rauner of holding the state hostage for 736 days, causing “devastation” for Illinois families.
“It’s time Bruce Rauner was held accountable for the damage he’s inflicted on the people of Illinois,” says a woman in Pritzker’s recorded call who identifies herself as part of his campaign.
In my opinion the Illinois voters will not “buy” that argument.
What the voters will see in the next 18 months is a constant barrage from candidates spending millions of dollars to deliver their message with their own “spins” to the voters of Illinois.
Leyden and Norwood Park Townships Need To Seriously Consider School District Consolidation
One of the maddening aspects of the state’s ongoing financial crisis is that some obvious long-term solutions are rarely considered.
One solution to the massive tax collections by state and local government is to reduce the number of local governments. That includes school districts that have been slow to consolidate in ways that would save money and allow more money to flow into classrooms.
According to a recent research report by the Illinois Policy Institute, the state’s 859 school districts are ripe for consolidation. About 25 percent of them serve just one school. One-third of Illinois school districts serve fewer than 600 students.
Although the districts are small, that doesn’t mean there isn’t a layer of bureaucracy. Not only does every district have a superintendent, but many have assistant superintendents, transportation supervisors, human resource and business staffs and other positions that could be eliminated with more school consolidations.
When compared with other states that serve more than one million students, it’s clear the Illinois system is inefficient. Florida, which has taken school district consolidation to the extreme, has an average of more than 40,000 students per district. California and Texas have about 6,000 and 4,000 students per district, respectively. Illinois has 2,339 students per school district, on average.
The savings of district consolidation could be significant, in both administrative costs and future pension costs. The institute study looked closely at districts in the New Trier Township. This wealthy Chicago suburb is home to six elementary school districts that feed into a single high school district. Taxpayers pay for seven superintendents; the average salary of those seven is $280,000 per year. Taxpayers could save millions a year on superintendent salaries alone.
The savings would not be confined to just one district, however. Because taxpayers across the state pay into the educators’ pension system, reducing the number of administrators in this one district would save taxpayers $30 million over the next 30 years, said the study.
The institute estimates if the state cut the number of districts in half, putting the average district size still less than California, there would be district operating savings of between $130 million and $170 million annually. The costs in pensions would be between $3 billion and $4 billion over the next 30 years.
In other words, this is something that would save the state, and taxpayers, real money. There are obstacles to consolidation, including a concern about the loss of identity. However, in this case, consolidation is not a rural issue. In fact, some of the greatest targets for consolidation are in heavily-populated areas.
There is little doubt that consolidating school districts is politically difficult. But so is raising taxes and explaining to schools why they don’t receive the resources they expect from the state.
To escape from its current financial doldrums, Illinois government needs to fundamentally change and the size of government needs to be smaller. School district consolidation is one place where change is necessary.
Local Mayors and Village Presidents, along with School District Board Presidents and Township Supervisors in Leyden and Norwood Park Townships need to provide the leadership to begin a conversation about consolidation.
As the over levying, and the excessive funds accumulations by some Districts and other Districts operating in serious deficit conditions continue to spiral out of control, the municipal officials are facing serious impediments to economic development and redevelopment, further increasing the tax burdens upon its taxpayers.
Leyden SD212 has successfully over levied to the point where they have accumulated massive sums of surplus funds and now realize over $7,000,000 more in annual tax revenue than expenditures. Now coupled with their accumulated surplus they are selling debt certificates to finance a capital building program which is approaching $125,000,000. This entire expenditure of a publicly funded project has been pursued by the SD 212 Board of Education with no public input nor a voter referendum. SD 212 has exploited holes in Illinois law to circumvent the taxpayers and voters of the District.
Schiller Park School District 81 has pursued a similar course of actions on the Kennedy School project.
In both circumstances, the Boards of Education have denied the taxpayers a voice while committing them to millions of dollars of principal and interest repayments over the next decades. All of this debt retirement is designed around escalating and excessive levies; while the taxpayers are told they face no additional costs. As these elected bodies engage in a “smoke and mirrors” strategy.
At the same time, the school districts of Norwood Park Township (while raising school fees to epic proportions) are operating with deficits and eroding what reserves they may have, hoping when the financial crisis reaches epic proportions in each district the voter will cave and approve rate increases.
The paradigm of protectionism of turf by school districts needs to end so that the best educational interests of the students are preserved while guarding the reasonable interests of the taxpayers and making the business environment affordable.
Property taxes are outpacing residents’ ability to pay them. Over the past 50 years, whether measured in comparison to household income, economic growth, population or inflation, all classes of property taxes – residential, commercial, industrial, etc. – have placed an increasingly unaffordable burden on Illinoisans. Since 1963, Illinois property taxes have grown 2.5 times faster than inflation and 14 times faster than the state’s population.
And looking at residential property taxes alone since 1990 shows:
• Residential property taxes in Illinois have grown 3.3 times faster than median household incomes.
• Illinoisans’ residential property-tax burden – as a percentage of median household income – has risen 76 percent.
• If Illinois froze its residential property taxes today, it would take 28 years for residents’ property-tax burden to return to 1990 levels.
The myoptic conduct of the boards of education are strangling the taxpayers; this thirst by the multiplicity of boards to squeeze excessive amounts of revenue for their fiefdoms is making it unaffordable for property owners and renters to continue to reside in our communities.
Our elected leadership has to act and act now before the economies of our communities are destroyed.
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