Senate Week in Review: Chicago Mercantile Exchange, Gaming, Pensions and More

Please note:  The Week in Review is written by a staff member of the Illinois Senate Republican Caucus and approved by legislators. It is meant to provide constituents with information about legislative action and activities during the week.

Springfield, Ill. - Legislative leaders and Gov. Pat Quinn met this week hoping to make progress on pending issues before the second week of the fall veto session.
 
State Sen. Ron Sandack (R-21st, Downers Grove) said state leaders discussed business tax relief and other incentives for the Chicago Mercantile Exchange Group (CME) and Sears, as well as small and mid-sized businesses. CME has threatened to leave Illinois if lawmakers fail to address what the company says is a significant tax burden imposed by the Democrats’ January 2011 tax hike, while Sears is seeking an extension to an expiring multi-million dollar incentive package the state passed in 1989 to persuade the company to remain in Illinois.
 
“CME pays more state taxes in Illinois than anyone, period,” Sen. Sandack said.  “They pay roughly one-sixth of all corporate taxes collected in the state and the hike in January increased its taxes by $50 million more.  The fact is, CME and Sears and other corporations are in play and other states are actively courting them to move.  This is attributable to Illinois’ many issues, singularly.  So to me, the question becomes how do we develop a stable and level playing field in order to try and obtain an equitable taxing policy – for everyone; resident and corporate citizens.”

Gaming Bill

In other anticipated veto action, a gaming bill may still be on the table. Following a leaders meeting Nov. 3, the Senate president indicated a revised gaming bill could very well be considered next week. Reportedly, discussions between legislative sponsors and Quinn, coupled with reforms suggested by the gaming board, have led to progress on a gaming bill compromise.
 
However, Senator Sandack noted the controversial measure faces opposition from key stakeholders. Primarily at issue is a movement to allow slot machines at Illinois racetracks. Though Quinn announced his support for a scaled-down version of the gaming legislation, the governor has spoken out strongly against the “racinos.”  Supporters of the measure say that eliminating gaming at Illinois racetracks would strip away support from downstate lawmakers that is needed to pass any gaming bill, as assistance to the ailing horseracing industry is considered essential. Removing that support would likely doom any alternative.

Pension Reform

Uncertainty surrounds a major pension reform initiative targeting benefits for current state employees and retirees.  Although most legislators agree that something must be done to address the state’s woefully underfunded retirement systems before they reach insolvency, all attempts to curtail benefits for state employees—including teachers, labor union workers, and retirees—have been met with strong resistance. However, Sen. Sandack said less controversial pension reform measures targeting egregious abuses of the state’s retirement system have been introduced, and may be considered next week.
 
“I cannot say enough that the pension system is the number one issue facing this state,” Sen. Sandack said.  “Some of the issue is controversial, but that does not negate the fact that reform must happen in order for Illinois to gain an improved financial footing.  It will not solve everything, but it will be a major step.  For the pension abuse legislation by union leaders, there’s no question that it should be passed immediately without dissent.”

Budget for Results

In other news, the first “Budgeting for Results” report was released this week. The report outlined financial priorities, goals, and expectations that the Budgeting for Results (BFR) Commission says will help state government deliver the best value to taxpayers.
 
The bipartisan BFR Commission is composed of legislators, the Lt. Governor and members of executive staff, outside experts and other stakeholders. In order to issue the commission’s first report, members examined state expenditures and available revenue, while also exploring options for spending reductions and identifying budget goals for the state.
 
GOP Caucus members—who have consistently introduced legislation mandating the state outline long-term budget projections, and have forcefully advocated for Illinois to spend within its means—are supportive of any effort to bring order and restraint to Illinois’ budget process. However, while hopeful that the BFR findings will produce meaningful results, Senate Republicans point out they have consistently pursued legislation to impose common-sense budgetary limits, goals and expectations, which have been rebuffed by their Democrat counterparts.
 
The Nov. 2 article “Illinois’ Budget: From Worst to ‘Worster’” from RealClearMarkets, underscores what Senate Republicans have been cautioning for years: “Illinois’ state budget, filled with gimmicks, constructed for years on promises for which there were no revenues, and sustained by borrowing of the type that would make even a loan shark blush, is in serious meltdown mode.”
 
Calling Illinois “The Loophole State,” RealClearMarkets backed up Senate Republican criticism of the most current budget. The publication noted that, “One way the state balanced this year’s budget is via a loophole that lets the state forego paying some of this year’s Medicaid bills, about $1.7 billion, until next year. Of course without reform the state is very unlikely to have enough money next year to pay all of its Medicaid bills plus the additional $1.7 billion from this year.”

“The bottom line is, those in charge of the state of Illinois continue to make fiscally irresponsible decisions,” Sen. Sandack said.  “They’re disastrously bad decisions, really, and they continue to rapidly worsen our state’s future.  Here we have another example of a media outlet highlighting Illinois’ financial woes.  So many others recognize the problem Illinois has, and it’s time that our leaders do the same and enact true budget reform.”
 
In order to rectify Illinois’ serious budget problems, the BFR Commission identified eight priority areas that demand “action-oriented results.” These areas are considered to be major functions and responsibilities of state government and include:
 
•    Quality education and opportunities for growth and learning for all Illinois students
•    Enhanced economic well-being for Illinois residents
•    Adequate public safety mechanisms and infrastructure to protect citizens’ lives, safety and property
•    Maintenance of a quality of cultural and environmental resources for Illinois residents and visitors
•    Protection of the most vulnerable Illinois residents
•    Improved efficiency and stability of state government
•    Access to quality, affordable health care for all Illinois residents
 
The commission’s report emphasized the importance of further developing goals and sub-goals that will better help to determine which services should continue being funded, and at what level. However, the commission found until better performance data about state spending and programs is available it would be premature to recommend specific allocations of projected revenue.
 
The commission will continue to meet throughout the next year, paying close attention to Quinn’s Fiscal Year 2013 budget proposal, the legislative appropriations process, and to the implementation of Budgeting for Results suggestions.
 
In the middle of the last week of Veto Session on Wednesday, Nov. 9, Sen. Sandack will host a Tele-Townhall event at 7:10 p.m.  The event will give people the opportunity to ask questions directly to Sen. Sandack about the important issues currently occurring in the state. 

“This event is part of my continuing efforts to inform people about events transpiring in Springfield and hear what people have to say about the important issues affecting our state,” Sen. Sandack said.  “It is my hope that many will be able to participate and listen in on the discussion that will take place.”

For more information, please visit Sen. Sandack’s website at www.senatorsandack.com or click here.