Budget

• General Assembly pay cut signed into law.  Last month, the Illinois House and Senate voted to cut lawmakers’ pay, saving taxpayers approximately $650,000.  For the fourth year in a row, General Assembly members will be required to take 12 furlough days and they will not receive a cost-of-living adjustment (COLA).  These provisions, contained in House Bill 3188, amount to a 5.5 percent pay cut for lawmakers.  The House concurred with Senate amendments to HB 3188 on a vote of 105-2-2.  The bill was signed into law on Friday, June 29 as P.A. 97-0718.

• Study shows some “earmarks” made their way through the General Assembly’s FY13 budget process.   A nonpartisan investigative study, published Monday, June 25 by the Associated Press, uncovered at least $4.25 million in taxpayer-funded State appropriations that had been quietly “earmarked” for specific recipients.  “We were scrambling to get votes to pass these bills,” explained Cook County Democratic lawmaker Fred Crespo.  The “earmarks” described by the Associated Press had not been seen in earlier budget documents negotiated between the four legislative caucuses on a bipartisan basis.  After the earmarks suddenly appeared in the final documents that were distributed to lawmakers hours before final passage, most House and Senate Republicans voted “no,” on May 30 and May 31, against the FY13 budget bills that contained the earmarks.

Children

• Representative Dwight Kay’s “Penn State” anti-child-abuse bill signed into law.  In a recent well-known criminal case, a former football coach connected with Penn State University was convicted of 45 separate counts of sexual assault and sexual abuse against children.  The ugly incident uncovered a serious loophole in the sex-abuse reporting laws followed in Illinois and many other states, because several of the Penn State incidents were witnessed but had not been reported to the police in a timely manner.  This non-reporting behavior allowed the coach to continue a pattern of predatory activities.  House Bill 3887 (Kay/McCarter) will require all personnel connected with an Illinois institution of higher education to report cases of child abuse that they witness or hear about, just as teachers and other personnel in elementary and secondary schools are required to do under current law.  Twenty-four House Republicans joined Representative Kay in sponsoring this measure. HB 3887 passed unanimously in both the Illinois House and Senate and was signed into law on Wednesday, June 27 as P.A. 97-0711.

Criminal law

• Governor signs controversial “early release” bill.  Despite a lack of support from most House and Senate Republicans, Democrats allied with Gov. Pat Quinn pushed a bill through the General Assembly to move up the release dates of prisoners already occupying bed space within the system.  The House vote on Senate Bill 2621, authorizing the Governor to work with the Department of Corrections to grant expanded sentence credits for “good conduct,” was 68-50-0.   After the Governor signed this bill on Friday, June 22, it became P.A. 97-0697.  Some nonviolent inmates could now be granted up to 180 days of good-conduct release credits after spending as little as 60 days in state prison.  While the new bill was touted by supporters as a pro-prisoner rehabilitation measure, the Department of Corrections told the Governor that several of their prisons are bursting at the seams.  The system as a whole has had 47,980 inmates sent to it to fill facilities that were designed to hold 34,000.  This, in turn, is leading to concerns that the Department will use the new law to simple release inmates early, whether they are rehabilitated or not, in order to free up desperately needed bed space.  Inmates released early will soon show up on Illinois streets, as the Governor is also taking steps to close down many of the “transition centers” that temporarily house inmates who are being moved from prison to post-prison parole.

Health Care

• Affordable Care Act/”Obamacare” decision raises stakes in Illinois’ insurance exchange fight.  The Affordable Care Act calls on the states to set up and operate key offices, called “health benefits exchanges,” that are expected by the law’s supporters to play a decisive role in implementation of the law by giving individuals a place to go to purchase the insurance policies that they will be required to buy under the Act.  The constitutionality of the “Obamacare” law was questioned, and the resulting U.S. Supreme Court decision on Thursday, June 28 explicitly upheld the rights of the states to refuse to implement some of their portions of this controversial federal law.  Under the high court decision, a case can be made that states like Illinois can refuse to set up a health benefits exchange.  House Democrats such as Rep. Frank Mautino have introduced legislation to set up an Illinois Health Benefits Exchange in compliance with the mandates created by the Obamacare law, but these proposals have not yet come up for a vote in the House and have not yet become law.  This decision is seen as raising the stakes for discussion of this issue in Springfield.

• While the U.S. Supreme Court upheld the constitutionality of the Affordable Care Act, the Court also ruled that Congress cannot penalize states that choose not to participate in the new Medicaid expansion by taking away their existing Medicaid funding. A number of Illinois House Republicans, including Representatives Adam Brown and Bill Mitchell, believe the General Assembly should pass legislation to opt out of the Obamacare Medicaid expansion, which would add an estimated 700,000 individuals to the state’s Medicaid rolls.  According to Comptroller Judy Baar Topinka, the Obamacare Medicaid expansion could cost Illinois up to $2.4 billion over the next six years.

Pensions

• Report finds State of Illinois not only entity facing pension woes.  A Monday, June 25 report, released by the Chicago-based Civic Federation, analyzed 10 key local public-sector pension funds utilized by workers in Chicago, Cook County, and other units of Chicago-area local government.  Civic Federation actuaries believe that these 10 funds had a collective funding level of 56.2% in 2010.  Some pensions are worse-funded: the firefighters’ pension fund had a funding ratio of 32.4% in 2010, and the Chicago police officers’ fund posted 39.7%.  The asset shortfall equals $8,993 for each resident of Chicago.  In some cases, partial responsibility for the pension shortfalls posted by specific funds – such as the pension fund that supports the retirement income of Chicago firefighters – can be attributed to pension “sweeteners” enacted by the State of Illinois.  In other cases, changes in employment patterns mean that the number of retirees receiving a pension is now greater than the number of active employees.  This dysfunctional ratio can be found in the pension funds that cover City of Chicago laborers, the CTA, the Chicago Park District, the Cook Community Forest Preserve Districts, and the Metropolitan Water Reclamation District.   Due to this combination of factors, local government pension assets are expected to fall $27.4 billion short of promised benefits.  This number can be compared to the $83 billion anticipated deficit posted by the five pension funds currently managed by the State of Illinois.

Schools

• House Speaker says Downstate, suburban schools and their taxpayers are enjoying a “free lunch.”  In widely reported remarks that followed a governmental summit meeting held on Thursday, June 21, Illinois House Speaker Michael Madigan called for making changes to the State’s pension system for teachers and other educational personnel to ”eliminate the free lunch for school districts outside of Chicago.”  The Speaker has joined with other Democrats in calling for a “cost shift” of teacher pension expenses, for districts other than Chicago, from the State of Illinois to the school districts that employed the educators who are eligible for the pensions. The cost shift would be phased in over a 10-12-year period.  House and Senate Republicans responded to this demand by renewing attention to the many mandates imposed by the State upon local school districts throughout Illinois.  In many cases, State aid programs operated under the terms of current Illinois laws provide disproportionate help to Chicago and other urban school districts, but not suburban or Downstate districts, to help meet the costs of these mandates.    

• New law will streamline educational service system.  Senate Bill 2706, a result of the Streamlining Illinois’ Regional Offices of Education Commission, takes steps to reduce, over a two-year period, the number of educational service region (ESR) offices throughout Illinois from 45 to 35.  A series of triggers are created in this new law for the various steps necessary to consolidate ESR offices.  Many of these triggers encourage voluntary consolidation action among Downstate ESRs and school districts, but a non-voluntary portion of this new law will forbid ESRs from continuing to operate as stand-alone offices if they serve populations of less than 61,000 Illinois residents (the current “floor” is 43,000 residents).  The State Board of Education is directed to look at the 2010 census and issue consolidation orders prior to June 1, 2014.  Although ESRs serve important functions, the General Assembly decided this consolidation move was desirable; the House vote was 115-0-0.   On Monday, June 25, the Governor signed SB 2706 into law as P.A. 97-703.     

Seniors

• Low-and-middle-income seniors looking for new options as Illinois Cares Rx program ends.  The Illinois Cares Rx program, which is not funded in the FY13 budget, fills some (but not all) of the holes in Medicare Part D coverage, the pharmaceutical subsection of the federal Medicare law.  The state drug assistance program helps more than 180,000 Illinois senior citizens purchase needed prescription medications.  After June 30, replacement lifelines for many senior recipients could include switching to generic medications, applying to private-sector drug assistance programs, and being more aggressive in seeking benefits from any private-sector insurance coverage a senior may have.  

Suburbs

• Toll road board studies Lake County Corridor proposal.  On Thursday, June 28, the Illinois Toll Highway Authority met to discuss the current proposal to complete the extension of Illinois Route 53 (the “Lake County Corridor”) as a toll highway with a cost of 20 cents per mile.  The price required to successfully finance the multi-billion-dollar project would make the proposed toll road one of the most expensive in the U.S.; the Chicago Skyway, however, costs 45 cents per mile.  The proposed toll corridor would stretch northward through central Lake County from Arlington Heights to Grayslake, serving suburbs that right now have daily traffic jams.