SENATE REJECTS HOUSE BUDGET; OPPORTUNITY TO SIGN A+ ILLINOIS' PLEDGE OF SUPPORT

 

As we move into the fourth week of the overtime legislative session, elected officials in Springfield continue to debate the 2008 state budget, which is to begin on July 1 of this year.  (Read an article from last week's Weekly Review to learn more about the implications for Illinois if legislators fail to pass a budget agreement by July 1.)

 

Just before session adjourned on May 31, the House passed a budget that contained limited or no money for some of Illinoisans' top priorities, including school funding reform, healthcare, paying off the state's pension debt, and property tax relief.

 

Last week, the Senate passed a resolution (SR258), rejecting the House budget, claiming that it provides inadequate funding for top priority items in Illinois and is unconstitutional because it is not balanced (click here to see how your legislators voted on SR258).  Indeed, many legislators who voted for the House budget saw the bill as a starting point from which budgetary discussions could begin rather than an ending point at which budgetary discussions would stop.

 

Advocates continue to work around the clock, urging Senators and Representatives to pass a budget that contains money for comprehensive education and fiscal reform.

 

What you can do:

 

1. Continue to call your legislators and tell them to pass a comprehensive school funding and fiscal plan that:

• Increases school funding and quality so that every child has access to a quality education,

• Restores Illinois' fiscal health, and

• Ends Illinois' over reliance on property taxes to fund schools.

2. Sign your organization onto the A+ Illinois Pledge of Support, stating that:

• We oppose a "no-growth" or "limited-growth" state budget.

• We support a responsible budget that adequately funds schools and other vital state services.

• We support an income tax increase dedicated to education.

ILLINOIS' PENSION CRISIS: A MESSAGE FROM IRSI DIRECTOR, JOURLANDE GABRIEL

 

At 40.7 billion dollars, Illinois currently holds the greatest total unfunded pension liability in the nation.  Unfortunately, the seriousness of this situation has been clouded by inaccurate claims of overly generous retiree benefits being the source of Illinois' immense unfunded pension liability.  Reality tells a different story. 

 

Illinois' current average state and local government employment retirement benefit is $1,426 a month.  Seventy-eight percent of Illinois public employees and retirees do not participate in the federal Social Security System.  Their public pension is the only secure retirement program they have.  Considering that the average apartments for rent in Chicago go for just over a $1,000 a month, with utilities costing an average of $86 a month, $1,426 a month can hardly be labeled lavish by any stretch of the imagination. 

 

The principal cause of Illinois’ $40.7 billion unfunded liability is Illinois’ repeated failure to appropriate the full cost of employee retirement benefits each year, as those benefits are earned.  Why this failure?  Because we have an antiquated revenue system that does not generate sufficient revenue to fund public services, and that produces revenue growth below what is required to maintain services at current levels.  As a result, Illinois has historically opted to skirt its full funding of the pensions in order to maintain spending on services.  Unfortunately, the longer the state defers its obligations to pay its pensions, the worse the problem becomes.  When the state fails to pay its required contributions, the amount it must ultimately contribute grows substantially over time. 

 

To alleviate this problem, interest groups have begun suggesting a switch from the current defined benefit system to a defined contribution system.  Such a move would not only fail to address Illinois' growing pension debt, but would add additional costs.  Under the state constitution, present employees are guaranteed a set income under the defined benefit plan, a switch of benefit plans would have no effect on already accrued benefits.  Only new hires could be placed in the defined contribution system; the switch would do absolutely nothing to eliminate the already incurred $40.7 billion unfunded liability.  Additionally, when compared to a defined benefit system, defined contribution systems have double the administrative and investment costs while decreasing benefits by an average of 66 percent.  At current benefit levels, this could mean a monthly benefit as low as $500 a month.

 

It is time lawmakers acknowledge the seriousness of this situation and develop a rational approach to addressing Illinois' pension crisis.  Already minimal retiree benefits are not the source of the problem and cannot be looked to for a solution.  State leaders must face up to their responsibility to fix our antiquated revenue system so we can fund the right priorities for the 21^st century, including public education, law enforcement and critical human services, all while paying what the state owes toward public employee retiree benefits for the services they have already rendered to the people of Illinois.

 

RESOURCES

• For additional information regarding the pension crisis facing Illinois, please review the recent study issued by the Illinois Retirement Security Initiative, The Illinois Public Pension Funding Crisis: Is Moving from the Current Defined Benefit System to a Defined Contribution System an Option that Makes Sense?

Questions or Comments? Please contact, Jourlande Gabriel, Director of the Illinois Retirement Security Initiative, (312) 332-1103 or jgabriel@ctbaonline.org.

 

ORGANIZATIONS VOICE CONCERN OVER THE STATE OF HEALTHCARE IN ILLINOIS

 

This Friday, June 29, Michael Moore’s newest documentary, Sicko, will hit theatres and comes out at a pivotal point in the debate over the nation's healthcare system.  The issue has come to dominate national, state and local policy agendas.  In Illinois, a couple of organizations have voiced concern over the issue in recent weeks.  Read on to learn more...

 

The Chicago Foundation for Women

CFW recently released the report, A Profile of Uninsured Women in Illinois, which looks at the various factors that affect the insurance status of women in Illinois. Among the factors studied were marital status, race, income, and age. According to the report, not only are women more likely than men to be uninsured; they are also more likely to avoid filling a prescription medicine due to cost. Among the findings are:

• 17% of women age 19-64 are uninsured in Illinois

• In Chicago, 24.3% of women are uninsured; this percentage is considerably higher than either downstate Illinois or the suburbs, (15.9% and 13.9% respectively)

• Of all ethnic/racial groups, Latinas are the most likely to be uninsured

• Uninsured women in Illinois are more likely be unemployed than uninsured men

Protestants for the Common Good 

In PCG's latest newsletter, Rev. Alexander Sharp, Executive Director of the PCG, released a letter to readers voicing his concern over Cook County's imploding healthcare system.  As a result of years of county mismanagement, Cook County Board President Todd Stroger entered office six months ago and was confronted with a $500 million budget deficit. President's Stroger's response to the deficit was a 17% across-the-board reduction to essential services such as healthcare, the public defenders office, and public safety.  Click here to read a Weekly Review articles on the Cook County budget cuts from January 23, 2007 and February 8, 2007.

 

Dr. Quentin Young of Todd Stroger’s Health Care Transition Committee says that in the next few months, “hospitals, many of them already in serious financial trouble, will be unable to absorb patients no longer served by the county. The problem will spiral out of control as county budget deficits—even with cuts already imposed—continue to mount.”

 

Coming soon...

• August 28 is the tentative date for the release of new U.S. Census data on income, poverty, and health insurance statistics. 

• Michael Moore's Sicko will hit theaters nationwide on June 29^th.  Reviews of the new documentary note that, unlike Moore’s previous movies, Sicko attempts to steer clear of confrontation, and instead focuses on the stories of real Americans who have suffered under poor or nonexistent healthcare system.  Click here to read Time magazine's full synopsis of the film.

SUPPORT TRANSIT FUNDING NOW!

 

Bring Illinois into the 21^st Century by supporting sustainable transit funding. The Northeast region has relied on a 24 year old funding formula that has not accommodated population growth or the loss of federal operating dollars eliminated over a decade ago. 

 

Call your legislators and Governor Blagojevich TODAY to urge them to support the funding and accountability reforms (SB 572, House Amendments 1 and 2) for the Regional Transportation Authority (RTA).   This is a good solution for the region and the state because it can reduce congestion and facilitate the movement of goods across the state and to the rest of the country.

 

These reforms will:

 

• Update the funding formula to restore fiscal health to the transit system and set it on a course for improvements and growth;

 

• Strengthen the RTA’s powers to ensure greater fiscal accountability from CTA, Pace and Metra and to evaluate performance and to improve coordination;

 

• Ensure 5-year strategic planning cycles that, among other objectives, take into consideration access to area jobs for low income communities, and;

 

• Create the Innovation, Coordination and Enhancement Fund as well as the Suburban Mobility Fund to furnish resources for demonstration projects and projects that address mobility for transit dependent populations.

 

(Legislation will eventually include reforms to the CTA pension so that expenditures are in-line with the new funding package.)

 

Every Vote Counts.  Since the legislature is now in an overtime session, every bill needs 3/5 majority in order to get passed out of its respective chamber.  That means that your support is more important than ever.

 

To contact your state Representative and Senator, click here.  To reach the Office of Governor Blagojevich, call (217) 782-0244 or (312) 814-2121.

 

RESOURCES:

• Hear from the Chair of the House Mass Transit Committee, Representative Julie Hamos (D-Evanston) about the legislation, go to www.juliehamos.org.

• Learn more about how transit is funded and planned, take a look at the primer, Transit Uncovered.

For more information, contact Dia Cirillo at 312-332-6522 or dcirillo@ctbaonline.org.