McConnaughay Reports

A missive from State Senator Karen McConnaughay:

Senator McConnaughay’s Legislative Update: January 25, 2016

Last week, Republican legislative leaders joined Gov. Bruce Rauner in endorsing a pension reform plan that would save taxpayers $1 billion each year. The plan is a refined version of pension reform legislation embraced in 2013 by many Republicans, Democrats and unions leaders—specifically written to comply with Illinois’ Constitution.

Karen McConnaughay

Karen McConnaughay

Another proposal introduced last week would give Chicago Public Schools the tools to fix its serious fiscal crisis—without bailing the system out at the expense of taxpayers in suburban and downstate communities.

On Jan. 20, Republican leaders outlined a plan that creates an independent authority to assume control over the school district that is calling on state taxpayers to pay for its $480 million shortfall.

Governor Rauner is expected to once again stress the need for economic recovery and comprehensive reform of state government during his second State of the State address on Jan. 27.

Such reform is particularly important according to a recent Chicagoland Small Business Economic Outlook Survey that shows a mixed response from Illinois’ business owners with it comes to the state’s economic stability.

The survey indicated that while most employers are planning to grow their business this year, they continue to lose confidence in local, state, and national economies.

As always, I hope you will contact me or my office with questions or concerns you may have. You can also visit my legislative website at www.senatormcconnaughay.com.

Sincerely

Karen McConnaughay
State Senator for the 33rd District

Republican leaders call for pension reform proposal that saves taxpayers $1 billion

Facing an unprecedented unfunded pension liability of $111 billion, the highest in the country, Gov. Rauner, Senate Republican Leader Christine Radogno and House Republican Leader Jim Durkin are calling for passage of a pension reform plan that the leaders said would save taxpayers $1 billion a year.

Click here to read more…

Republicans offer lifeline to Chicago Public Schools

Chicago Public Schools (CPS) are facing a $480 million budget shortfall, a fiscal crisis that the state’s leading Republicans say demands an overhaul of the current system—not a bailout of CPS at the expense of taxpayers in suburban and downstate communities. Republican legislative leaders introduced a proposal on Jan. 20 that allows for the creation of an independent authority to assume control over the school district that is calling on state taxpayers to pay for its $480 million shortfall.

Click here to read more…

CPS downgraded again

Just a short time after Republican legislative leaders announced a proposal on Jan. 20 to help Chicago Public Schools with their ongoing financial crisis, Fitch Ratings downgraded CPS’ credit rating to B-plus, moving CPS deeper into “junk” status.

It’s the latest mark against a school district facing a nearly $500 million budget shortfall, and which faces thousands of teacher layoffs and the potential for a massive strike.

Click here to read more…

Governor Rauner to deliver State of the State address next week

On Jan. 27, Gov. Rauner will deliver his second State of the State address. Like 2015, the Governor’s address is expected to focus on job creation, making Illinois more competitive, boosting the state’s economy, and stressing the need for a balanced budget and structural reforms to state government.

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Chicagoland survey shows most small businesses planning to grow

There is some good news for job seekers and local economies in the annual Chicagoland Small Business Economic Survey. According to the survey, 76 percent of respondents plan on growing their business in 2016.  In addition, 38 percent expect to hire more workers, and 52 percent plan on expanding within Illinois, up from 45 percent last year.

On the other hand, businesses are also losing confidence in local, state, and national economies. Just 28 percent of business owners think Chicagoland’s economy will strengthen over the next year, down from 42 percent the year before. Also, nearly half of respondents feel negatively impacted by local taxation.

Click here to read more…


Comments

McConnaughay Reports — 2 Comments

  1. Can we please have a legislator that will advocate real permanent sustainable pension reform.

    Repeal the pension sentence.

    That’s the best choice.

    The pension sentence was flawed.

    It bound taxpayers to unlimited legislative pension and retiree healthcare benefits while pensions and retiree healthcare were already underfunded.

    Go back to the inception of the pension and retiree healthcare funds.

    No benefits should have been hiked until funding was 100%.

    Arguably salaries also.

    That’s common sense.

    Fully fund, then hike.

    Don’t hike when funding is not 100%.

    That just creates a bigger taxpayer IOU.

    In other words, don’t charge the credit if you are carrying a credit card balance.

    The pension sentence added to the state constitution on December 15, 1970 was a scam against taxpayers.

    The unions should not have been lobbying for hiked benefits while pensions were underfunded.

    Actually benefit hikes to underfunded pensions predated the unions, so they don’t get all the blame.

    There is no taxpayer fairness in the pension sentence.

    None.

    No taxpayer protection in the pension sentence.

    None.

    The result of the pension sentence:

    A legislative pension benefit hike is a promise.

    A salary hike is a promise to hike pensions.

    Those are the promises that resulted from the pension sentence.

    Along with the union mantra, a pension is a promise, which should be, a hiked pension is a promise.

    Unlimited legislative pension benefit hikes to underfunded pensions is a promise.

    Etc.

    Here is the sentence that needs to be repealed.

    We’ll break the sentence up in parts so it’s easier to digest.

    “Membership in any pension or retirement system of the State,
    any unit of local government or school district,
    or any agency or instrumentality thereof,
    shall be an enforceable contractual relationship, t
    the benefits of which shall not be diminished or impaired.”

    That’s it.

    One sentence.

    Translated:

    Illinois public sector pension and retiree healthcare benefits,
    are contractual,
    the benefits cannot be reduced;
    but the benefits and salaries can be hiked,
    even if pensions are already underfunded,
    and the scheme is guaranteed by taxpayers.

    Result is $158 Billion unfunded pension liability in 17 Illinois public sector pension systems as of the end of FY 2014 (excluding CHA, CTA, RTA / Metra / Pace pension funds).

    The 17 funds in the $158B:
    – the five “state” pension funds (TRS, SERS, SURS, GARS, JRS)
    – the four “Chicago” pension funds (Chicago Fire, Chicago Police, Chicago Municipal aka MEABF, Chicago
    Chicago Laborers (LABF)
    – Chicago Park District
    – Chicago Public Schools
    – Cook County
    – Cook County Forest Preserve
    – MWRD (Metropolitan Water Reclamation District which is largely Cook County and Chicago)
    – IMRF (municipal outside of Chicago and county outside of Cook)
    – Downstate Police
    – Downstate Fire

    $158,000,000,000 taxpayer IOU to the pension funds as of the end of fiscal year 2014.

    No more Mickey Mouse pension reform.

    We need real meaningful pension reform.

  2. A Chicago property Taxpayer pays about 30% less than a collar county property taxpayer for a piece of property of the same market value.

    The first step is to raise the Chicago real estate owners to the level of property taxes that we pay, then consider bailouts.

    Unless the Democrats steal it all, we won’t need a state bailout for the failed Chicago Public Schools.

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