Illinois Issues blog: Education and = electricity

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Tuesday, March 20, 2007

Education=20 and electricity

Two juicy debates

In downtown Springfield, = the=20 Illinois Commerce Commission heard Ameren Illinois president Scott Cisel = defend=20 his recent decision to end some of the utility=E2=80=99s electricity = rate relief to=20 downstate customers. In the Capitol, Gov. Rod Blagojevich said = he=E2=80=99d veto any=20 proposal that would increase income and sales taxes, as stated in a press = release handed=20 out during a House committee. House Speaker Michael Madigan, on the = other hand,=20 signaled he=E2=80=99s willing to let the so-called tax swap proposal see = the light of=20 day by sending his general counsel to moderate debate on an education = funding=20 reform proposal.

That legislation has nine lives, but supporters = and=20 opponents of the revised version agree on two things: 1) no one at the = hearing=20 likes the governor=E2=80=99s revenue idea to replace the corporate = income tax with a new=20 tax on business inputs; and 2) there=E2=80=99s lots of room to tweak the = legislation.=20 The House committee is expected to vote on the measure when it = reconvenes, which=20 could be soon.

In general, HB/SB=20 750 would reform the way the state funds education by increasing = income=20 taxes, expanding sales taxes to apply to services and offering property = tax=20 relief.

Supporters of the bill include Ralph Martire of the = Center for=20 Tax and Budget Accountability. In committee, he said no schools would = lose, and=20 businesses would be =E2=80=9Cnet tax winners=E2=80=9D under the = legislation.

The=20 opposition includes J. Thomas Johnson of the Taxpayers=E2=80=99 = Federation of Illinois,=20 who said the legislation puts =E2=80=9Cthe cart before the = horse=E2=80=9D because it talks about=20 distributing new revenue before it spells out how the money would = improve=20 education (and stipulates that it wouldn't be diverted to other state or = local=20 operations). He added that legislators needed to have a clear = understanding of=20 the actual property tax relief offered by a tax swap. = =E2=80=9CWe=E2=80=99ll never meet the=20 taxpayers=E2=80=99 expectations,=E2=80=9D he said. =E2=80=9CRhetoric = will come back to haunt=20 us.=E2=80=9D

Johnson, along with the Civic Committee of the = Commercial Club of=20 Chicago, said the state should consider at least three ways to save $1 = billion=20 before asking taxpayers to pay more. He said Illinois could save by = reforming=20 the state=E2=80=99s public employee retirement benefits, such as the = retirement age and=20 cost of living adjustments, as well as by using more managed care for = state=20 employees and Medicaid enrollees.

Electricity=20 rates
The Illinois Commerce Commission cut off discussion = that was=20 leading to Ameren Illinois=E2=80=99 recent proposal to return to a = regulated system,=20 where the state sets electricity rates rather than the utilities buying = power on=20 the open market. The downstate utility used doom=E2=80=99s day rhetoric = in Tuesday=E2=80=99s=20 commission hearing to explain its recent decisions.

Ameren also = recently=20 decided to suspend programs that would provide rate relief to its = customers.=20 Commissioner Erin O=E2=80=99Connell-Diaz chastised the utility for = =E2=80=9Cnot keeping=20 customers in the loop.=E2=80=9D Ameren has yet to inform the 7,000 = customers enrolled in=20 a deferred payment plan that it has stopped the program.

The = utility=20 blamed its decision to halt these programs on the House, which approved = a=20 measure that would provide credits to customers and a three-year rate = freeze.=20 Soon after the House measure won approval, the company=E2=80=99s credit = rating was=20 downgraded to junk status.

According to the company's president = and CEO,=20 Scott Cisel, if the Senate approves a separate but similar measure, = Ameren=20 Illinois may be forced to lay off employees and contractors. = Furthermore, unless=20 the legislative leaders in both chambers ensured Ameren that the General = Assembly wouldn=E2=80=99t attempt to refreeze electricity rates, the = company would go=20 into survival mode.

=E2=80=9CThis is a who-blinks-first = game,=E2=80=9D says Illinois=20 Commerce Commission chairman Charles Box. =E2=80=9CBoth sides do not = want to give up=20 leverage, but whose suffering? It's the citizens that are suffering, = especially=20 the elderly and the people who have gigantic bills.=E2=80=9D

Blog Archive

=E2=96=BC 2007=20 (17)=20
- =E2=96=BC M= arch=20 (7)=20
  - Education=20 and electricity=20
  - Price=20 fixing?=20
  - ICC=20 calls Ameren to account=20
  - Reconsidering=20 rebate=20
  - Budget=20 reaction=20
  - The=20 governor's "moral imperative"=20
  - Budget=20 highlights
- =E2=96=BA F= ebruary=20 (6)=20
  - Utility=20 campaign contributions=20
  - TGIF=20
  - Obama=20 for president=20
  - = Moneymakers=20
  - = Budget=20 buzz=20
  - Blagoterminator=20
- =E2=96=BA J= anuary=20 (4)=20
  - Dream=20 job ends at IDOT=20
  - Mayday,=20 mayday=20
  - Illinois=20 buzz=20
  - = Now=20 we know

=E2=96=BA 2006=20 (52)=20
- =E2=96=BA D= ecember=20 (4)=20
  - Phases=20 of deregulation=20
  - Cr= ossfire=20
  - More=20 electrifying debate=20
  - Universal=20 health care?
- =E2=96=BA N= ovember=20 (10)=20
  - Waiting=20 games=20
  - What=20 this means=20
  - New=20 term, same quotes=20
  - Blame=20 it on the money=20
  - "That's=20 the way it goes"=20
  - Topinka's=20 coming=20
  - Birkett's=20 response=20
  - Topinka's=20 first response=20
  - Winner=20 already?=20
  - Election=20 night
- =E2=96=BA O= ctober=20 (5)=20
  - Brea= the=20
  - For=20 better or for worse=20
  - Obama=20 mania=20
  - Rezko=20 repercussions=20
  - P= ower=20 play
- =E2=96=BA S= eptember=20 (1)=20
  - Ag=20 wish list
- =E2=96=BA A= ugust=20 (2)=20
  - Pension=20 promises=20
  - Valuable=20 toll roads
- =E2=96=BA J= uly=20 (3)=20
  - F= OIA=20 facts=20
  - When=20 in Rome=20
  - Headlines=20 are good
- =E2=96=BA J= une=20 (3)=20
  - Going=20 private, or not?=20
  - Going=20 public=20
  - Horse=20 subsidy hurdle
- =E2=96=BA M= ay=20 (12)=20
  - Major=20 education proposal=20
  - More=20 background=20
  - More=20 stressors=20
  - Bu= ckle=20 up=20
  - Pick=20 your poison
- =E2=96=BA A= pril=20 (9)
- =E2=96=BA M= arch=20 (3)

=20

Illinois = Issues=20 blog

Tuesday, March 20, 2007

Education=20 and electricity

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