Food assistance funding is now on the chopping block. In a state that is crippled by fiscal failures and a heavy pension crisis, the Supplemental Nutrition Assistance Program (SNAP) is facing a total of $20 billion in cuts over 10 years, harming soup kitchens, food pantries and needy families. Three democratic leaders took a stand this week urging Congress to rethink their actions. Tammy Duckworth (D-Illinois), Robin Kelly (D-Illinois) and Bill Foster (D-Illinois) who represent different districts opposed the plan citing two million families will be affected.
Those who oppose government assistance will be the first to accuse liberals of instituting government dependency not understanding how some families literally have nothing. There are children who are being bred in a life of poverty in the world's richest country. It's not just a matter of creating an enabling mentality but there are few employment opportunities in many neighborhoods, slim transportation options and various other factors that contribute to a family's financial demise. It's impractical to cut food assistance without providing alternatives such as a co-op, eliminating food deserts, constructing affordable farmer's markets and perhaps waiting until the recipient is employed or finds a higher-paying job.
Protesters blasted the plan for deep budget cuts that would put many schools in untenable situations. Demonstrators collected toilet paper donations as a nod to the fact that these budget cuts would leave many schools stretched so thin they'd be unable to pay for even the most basic of supplies--including janitorial supplies like toilet paper.
Roseland Community Hospital announced today it will keep it doors open with $350,000 in state emergency assistance until a more sustainable solution is reached. These actions come two weeks after 100 staff members were laid off due to a $600,000 shortfall to pay employees. Administrators and aid experts will review a financial plan to salvage the medical center.
This week it was revealed that the state owes Roseland Community Hospital $6 million for its children's behavioral health unit. Hospital administrators have reduced the deficit from $9 million to $5 million. Governor Quinn claims the hospital board has a history of monetary mismanagement which has led them to the current situation. President and CEO Dian Powell who resigned this morning disregarded financial irresponsibility led to the mess and said, "They owe us money." Powell's resignation comes after allegations of unfairly blaming missing payments from the state as a critical factor in the hospital's fiscal demise.
But while House Republican Leader Tom Cross (also a co-author of the bill, along with Rep. Elaine Nekritz) called it "the meat and potatoes of pension reform," it doesn't seem so clear that today's step is actually one in the right direction.
The Illinois pension problem has heated up in a major way over the past several weeks, with Standard & Poor downgrading the state's credit rating back in January and the SEC announcing charges against the state for misleading bond investors regarding the implications of unfunded pension obligations. Some lawmakers have even called for--gasp--skipping the upcoming break from session in order to settle the pension mess.
But while today's bill has the right idea (i.e. something has to happen), it doesn't seem likely that the bill will make it past (1) the Senate or (2) the Supreme Court. Yesterday, the Senate shot down a bill that was similarly far-reaching regarding pension reform. And even if the bill does pass the Senate, as CapitolFax guru Rich Miller put it on Monday, the Nekritz-Cross pension bill "makes almost no pretensions of being constitutional."
The Illinois General Assembly is considering legislation, known as SB3261, to require hospitals that receive property tax exemptions to provide more than stabilization care (already required by the federal Emergency Medical Treatment and Active Labor Act, or EMTALA) to people who earn 125% or less of the federal poverty level in rural areas, and 200% or less in urban areas. The amount of free and subsidized care provided by hospitals has been a hot button issue in Illinois, and across the country, at least since 2007, when the U.S. Senate began a series of hearings on charity care, and in Illinois since a high-profile case involving Provena health care put hospitals' tax exemptions in limbo. The legislation is an interesting approach to solving the problem of health care provisioning for low-income residents, given the immense shortfalls in Medicaid funding states have been facing since the freefall in tax revenue brought on by the Great Recession.
Governor Quinn, who cut a concession deal with AFSCME shortly before getting their endorsement, has since the election turned around and decided that due to budgetary reasons, the union's members should not get the raises specified in their contract.
It seems to me that in many ways, going back on a union contract with a union that endorsed you and worked hard to get you elected in a close election would be worse than having a governor who you knew was going after you from the start.
Suffice to say, AFSCME does not seem real happy about all this and I got to talk to AFSCME Council 31 Executive Director Henry Bayer about Governor Quinn's move and next steps.
Hey everybody! Thanks for stopping by Mechanics in between booking one-way tickets to Ottawa on Priceline in anticipation of the proto-fascist Republican takeover of the federal government or researching your upcoming blog post, "The Democratic Party is Toast (For Real This Time)."
I joined Lenny McAllister of WVON and Nenna Torres of UIC to talk about last night's election results with Alison Cuddy of WBEZ's 848. Highlights include me calling Pat Quinn "a tough dude." For the record, I was this/close to calling him "one tough motherflipper." You're welcome, BEZ. Check it out.
SEIU Health Care Illinois-Indiana, an SEIU "megalocal" that emerged after the fusion of Locals 4, 880, and 20, is taking to the airwaves to remind people of the costs of cutting programs like home care:
The ad's message portends just how grievous the cuts to social services will be if the public attitude towards public spending--vilified by anti-public zealots for generations--aren't improved. More than 50,000 senior citizens in Illinois are cared for by home care workers, allowing them to stay out of (expensive) retirement homes and maintain some of the dignity of living in their own home.
Probably the most difficult type of organizing is what's known as "coalition politics", pulling together existing organizations to move a grassroots program. The conflicting ideologies and tactics of different groups, differentials in resources, and often hard to manage personalities make coalition politics immensely frustrating. This makes the continued existence--and, in fact, progress--of the Responsible Budget Coalition particularly surprising.
It is also eye-opening. There is often a lazy false equivalence between left and right "special interest groups" when it comes to public spending; anti-tax zealots like to stoke resentment of "public employee unions" as a means to pressure legislators to slash public spending. Take a look at the RBC's roster of organizations and consider if these "special interests" are equivalent to large profit seeking firms that fund the "cut to the bone" think tanks and political funds:
Financially over the long haul increasing the age in which people can retire at full retirement benefits will reduce the overall financial impact of state pensions over time.
The big question is how is the state going to recognize the savings.
Under Governor Blagojevich, when changes were made in the financing of the state pension systems the legislature would recognize multiple years worth of "savings" in a single year and use that "savings" to shore up a current budget.
Back in 2005 they made some changes to pension financing and used the "savings" to avoid making payments into the system even though the savings would be realized until several years down the road.
Gov. Rod Blagojevich has a plan for reforming teacher pensions that he says will save millions -- millions the state can begin spending to balance next year's budget.
That idea, says the head of the Illinois Teachers' Retirement System, sounds more like it came from the mouth of a teenager.
"It's kind of like as if my 17-year-old daughter says to me, 'Dad, I might have a baby-sitting job a week from Tuesday, so could you give me 40 bucks now?'" TRS's Jon Bauman said. "It just never makes sense to spend money before you have it. And that, in effect, is what this is all about."
So it's a positive step in the right direction.
The question will be how the state legislature decides to handle the "savings" when it is budget crunch time.
Apparent gubernatorial candidate and poor black child Dan Proft faced off with Hank Scheff of the American Federation of State, County, and Municipal Employees (AFSCME) Council 31 to talk about Quinn's reform. While I agree with Scheff generally, both he and Proft are very smart guys and come from a sincere (non-partisan) place. That makes this very worth a watch:
GEO President Charles Moss delivers petitions to UIC Chancellor's office.
The Graduate Employees Organization of the University of Illinois at Chicago is a union for graduate student employees. GEO members have been working this school year without a contract and are facing a heated battle with UIC's administration.
GEO has been attempting to negotiate a contract with the administration, but has reached a stalemate over a number of issues including guaranteed assistantships. They began mediation with the university and a neutral mediator last week.
On March 10, the day before they began mediation, members of the Graduate Employee Organization of the University of Illinois at Chicago delivered petitions signed by UIC community members urging the university to bargain in good faith and to take the mediation process as serious as GEO does. The petition urged the chancellor to direct the universities bargaining team to negotiate fairly.
Charles Moss, the president of GEO said that GEO, "takes the mediation process seriously. We would rather settle the contract through mediation than go on strike." Moss added that GEO organizers have been putting in a lot of work to obtain a fair contract.
A group of GEO members went to the 28th floor of the University building hoping to give the petitions to Chancellor Paula Allen-Meares. Allen-Meares was at a trustees meeting and the GEO members gave the petition to Assistant Monica Rausa Williams.
When you borrow money it is reasonable that the folks who loaned you the money expect to be paid back, with interest. That is another issue that is now facing the state budget and it's another issue that did not appear overnight. The Civic Federation on Chicago has a report (PDF) that covers some of this in depth.
But like I pointed out in my last post about the budget, none of this is really a surprise.
Long Term Debt
In FY 2001 the state was spending about a billion dollars a year on long term debt service; in FY 2008 it had doubled to $2 billion; in FY 2011 it is projected to be $2.7 billion. So in the past seven years it has just about doubled.
In terms of the debt, in FY 2001 the state had about $8.4 billion in debt; FY 2008 it had $21.1 billion in debt and in FY 2011 it is estimated at $25.4 billion. These are state bonds that need to be paid, not the general underfunding of the state pension system.
Short Term Debt
Short-term debt is state debt that has to be paid back in a year. In FY 2007 it was $900 million, FY 2008 it was $2.4 billion, in FY 2009 $1.4 billion.
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