The McDermed Dispatch for June 6th


Regularly scheduled spring session ended on May 31st, but the State of Illinois remains in an unprecedented financial situation. We return to Springfield this Wednesday. 

Still No Budget
        As I’m sure you know by now Speaker Madigan attempted to pass a spending plan that spent $40 billion dollars.  This is the largest spending plan or “budget” in Illinois history and, because it did have attached revenues, would have doubled the state’s backlog of unpaid bills which currently sits at around $7 billion. To pay for such a large increase in spending would have required us to raise the income tax to 5.5%. Legislators had to vote on the 500 page bill just a few hours after it was filed. It passed the House, but then the bill sat in the Senate for several days. On 10pm the night we were scheduled to end spring session it was finally brought to a vote and lost with only 17 of 59 senators supporting it. As a result, despite session going very late in to the night on May 31st, we finished without a budget.
         When it became clear that we could end session without a balanced budget, House Republicans filed a budget bill, HB6585, to cover both FY16 “stopgap” expenditures and some urgently-needed FY17 expenditure areas. The bill is fully funded from existing revenues. Governor Rauner said that Democratic leaders indicated to him that despite the progress of the bipartisan working groups on non-budget issues, neither the House nor the Senate would take them up for a vote before November elections.  As such, there were none of the Governor’s “Turnaround Agenda” items that the Speaker has refused to negotiate or compromise on attached to the legislation. Even so, Speaker Madigan did not let the bill come to a floor for a vote before Tuesday night’s adjournment.
         The House and Senate have both adjourned, but the chambers remain in continuous session, like last year. With regular session over, bills now require 71 votes in the House to pass.  It would be very difficult for any bill to pass without at least some bipartisanship or compromise involved. There is a framework for a temporary budget solution in HB6585 that would keep state government functioning, including universities and social services, through January. A deal could be reached as early as this week.  While not ideal, this would insure that more time is given to negotiate on reforms and a full budget. This would also remove the impediment of the November elections.

Republicans Move to Take Education Out of Budget Crosshairs
         House Republican Leader Jim Durkin has responded to the current impasse by filing a separate bill to fully fund K-12 education in Illinois for FY2017. This strategy follows the one adopted in 2015, where schools opened despite the absence of a state budget.
         HB6583 includes a $104.8 million “hold harmless” provision to ensure that no schools lose money over last year and all Illinois public school districts receive at least 100% of their gross prorated 2015-16 General State Aid school aid in FY17. This will be the first time in a decade that the state fully funds the school funding formula. Enacting HB6583 will mean that Illinois schoolchildren and their families can look forward with certainty to a school year starting in September.

Legislation Passes Both Chambers
        Of the thousands of bills filed since January, 446 total bills have been sent to the Governor, including:
SB 10 extends the medical cannabis pilot program from 2018 to 2020. The bill, among other changes, will also allow patients with post-traumatic stress disorder (PTSD), and patients with a terminal illness diagnosis of 6 months or less, to apply. 
SB 250 would automatically register to vote anyone older than 18 who applies for, or renews, a drivers’ license. The new voter’s name would be automatically sent to the State Board of Elections unless the applicant specifically asks not to be registered.
SB2157 will require community college trustees to undergo training on the financial, ethical, and legal obligations of their duties as trustees in the 1st, 3rd, and 5th years of their terms.  Similarly, SB2174 establishes leadership training for public university board members. Such training already exists for K-12 school board members.
SB2746 eliminates the 6.25% sales tax on tampons, menstrual cups, and menstrual pads.

General Assembly Overrides Governor on Chicago Pensions
          The House and Senate issued Governor Rauner the second veto override of his term this week.  The Governor vetoed SB777 over concerns that it was more of the same bad pension obligation practices that landed the state and the city of Chicago with such large unfunded pension liabilities.  The bill, now law, lowers the Chicago police and fire pension ramp payments for the city until 2020 and extends the ramp period to 90% funded by 15 years.  In addition, any future Chicago casino revenues would automatically be placed in the pension fund. 
          This override is proof that both Chicago and Springfield have not learned the lesson of how short term pension relief hurts taxpayers when the chickens come home to roost years later. Pension holidays and the lengthening of pension ramps merely delay the responsibilities of the government and cause unfunded liabilities to balloon. 

UnitedHealthcare Pulls Out of Affordable Care Act in Illinois
        UnitedHealthcare, one of America’s three largest health care insurers, blamed financial losses for the decision.  Existing patients will continue to be covered by UnitedHealthcare through the end of the calendar year.  For many Illinoisans, participation in the ACA insurance marketplace is required by law and nonparticipants are subject to fines and penalties. The State of Illinois operates a webpage, “Get Covered Illinois,” for persons who need to try to find new health insurance policies.  The next ACA open enrollment period will start on November 1, 2016, and will end on January 31, 2017. 
 
I will be in Springfield on Wednesday where I will continue to fight for a balanced, responsible budget. Have a good week!