·
New report shows cumulative State
deficit of $47.8 billion. This cumulative deficit of almost $48 billion
(nearly $4,000 per Illinois resident) comes from the Comprehensive Annual Financial Report (CAFR) for FY 2013, released by
Comptroller Judy Baar Topinka and the Statewide Financial Statement Audit released by Auditor General Bill
Holland. The purpose of the figures
presented in the CAFR are to drill past the cash-flow situation of the State of
Illinois (which is what the “official” State budget looks at) and uncover the
gap between resources available and commitments made.
The majority of the gap consists of pension obligations and
commitments to pay health-care-related expenses to providers of services to
eligible patients, primarily Medicaid patients and State workers. This number is not a one-year deficit, but a
representation, on a balance-sheet basis, of the cumulative deficit that has
been building up over a multi-year period.
Almost two-thirds of the deficit has appeared during the past seven
years ($18.7 billion in FY06 to $47.8 billion in FY13), roughly coinciding with
the tenure of Gov. Pat Quinn.
Illinois’ unpaid bill backlog of $6 billion makes up a significant
chunk of the overall $48 billion deficit, but well more than half of the
deficit has not yet been billed to the State.
It represents the current cash value of the State’s promises to fulfill
future commitments. In some cases, such
as the December 2013 pension reform law now being tested in the courts, the
State may be able to retroactively alter the terms of these commitments and
thereby reduce the deficit.
Particularly concerning to hardworking taxpayers is the fact that
despite raising taxes by $26 billion, Illinois still has a $48 billion
long-term deficit and $6 billion in unpaid bills. With the “temporary” 67% income tax increase
set to partially roll back in 2015, will Gov. Quinn and Democrat legislators
raise taxes again or will they finally work with Republicans to cut wasteful
spending and put a stop to fraud and abuse?
Budget – State Debt Rating
·
Taxpayers paid estimated $80 million
more in interest due to poor credit rating. The finding, which covered
the five years from 2008 into 2013, came from the Institute of Government and
Public Affairs, an affiliate of the University of Illinois. The Institute tracked Illinois’ debt
issuances and the interest rates the State and its taxpayers were required to
pay by the marketplace.
General obligation debt, the debt sold by Illinois for most
capital infrastructure purposes, is currently ranked by Wall Street in the
lower half of investment-grade securities.
For example, Moody’s (the world’s largest credit-rating firm) currently
ranks Illinois as A3 with a negative outlook, four notches above non-investment-grade
level. The City of Chicago is currently
ranked by the same firm as Baa3, three notches above “junk bond” level.
Investors traditionally demand higher interest rate payments and
premiums from borrowers with subpar credit ratings. The $80 million difference tabbed by the Fiscal Futures Project of the Institute of Government and
Public Affairs represents the difference between the interest rates actually
paid by the State of Illinois and the collective interest rates paid by all 50
states.
Many of Illinois’ neighboring states have less debt, lower
structural deficits (or even fiscal surpluses), and much higher credit ratings
than Illinois. For example, Moody’s has
awarded Indiana its coveted “AAA” rating, the highest rank available.
Concealed Carry
·
Number of late-stage concealed carry
license (CCL) application approvals pass 25,000; applications pass 50,000.
These numbers reflects the applicants who have paid an application fee
and undergone required CCL training. The
Illinois State Police reported on Tuesday, March 11 that the number of
applications had reached 51,040, and the number of licenses approved had
reached 27,139 (more than half the total).
Of these applications, 26,000 (51%) came from the ninety-six counties
that make up Downstate Illinois, and 25,040 (49%) came from the six-county
Chicago area.
CCL applicants are required to pay a $150 application fee,
electronically submit personal identification information, and undergo
significant personal safety training (16 hours of training for most
applicants). The large number of
applications making their way through the system demonstrates the status of the
new State CCL law.
Of the more than 51,000 fully submitted applications, more than
half have been approved. Further
approvals are taking place daily.
Objections have been filed by local law enforcement to a small fraction
of total applicants; 946 of the completed applications, less than 2 percent of
the total, have been objected to. Under
current law some forms of criminal conviction, such as the violation of an
order of protection, may be sued as grounds to deny CCL licensure.
A link to the CCL application process, with answers to frequently-asked
questions about the application process, can be found here: https://ccl4illinois.com/ccw/public/home.aspx.
Heroin Epidemic
·
House Republican bill to increase
treatment options advances to House floor. While discussions
continued on the specific responses Illinois will make to the current epidemic
of heroin abuse and overdoses, HB 5766 (Reboletti) has advanced to the House
floor for further debate. The bill
authorizes the Illinois Department of Corrections (IDOC) and DuPage County to
enter into an intergovernmental agreement to set up a substance abuse treatment
center as a destination point for eligible people who have been sentenced to
imprisonment.
This substance abuse treatment center would provide intensive and
individualized evidence-based substance abuse treatment to eligible persons
diagnosed as potentially benefitting from this treatment. A House Task Force is looking into heroin and
other opiate-drug addiction issues this spring, and is gathering testimony on
the correct models to be looked at as the public sector moves forward with this
treatment option. It is believed that,
in some cases, mandatory treatment provided to some convicted offenders could
be part of a cost-effective punishment regimen and could provide a pathway to
rehabilitation for these individuals.
Illinois Jobs
·
Unemployment up in Illinois and its
metro areas. January unemployment numbers for
Illinois’ metropolitan areas, released on Thursday, showed an increase in
the jobless rate for every area. While
the Illinois and metro unemployment rates have mostly declined from a year ago,
the uptick in month-to-month unemployment continues to be a serious concern for
Illinois policymakers.
UNEMPLOYMENT
RATES FOR THE STATE, METRO AREAS, COUNTIES, AND CITIES
|
|||||
NOT
SEASONALLY ADJUSTED
|
|||||
Change
Over
|
Change Over
|
||||
STATE,
U.S. AND METROPOLITAN AREAS
|
Jan-14
|
Dec-13
|
Jan-13
|
the
Month
|
the
Year
|
ILLINOIS
|
9.1
|
8.6
|
10.2
|
0.5
|
-1.1
|
UNITED
STATES
|
7.0
|
6.5
|
8.5
|
0.5
|
-1.5
|
BLOOMINGTON-NORMAL
MSA
|
7.7
|
7.2
|
7.8
|
0.5
|
-0.1
|
CHAMPAIGN-URBANA
MSA
|
8.5
|
8.0
|
9.1
|
0.5
|
-0.6
|
CHICAGO-JOLIET-NAPERVILLE,
IL METROPOLITAN DIVISION
|
8.6
|
8.3
|
10.0
|
0.3
|
-1.4
|
LAKE
COUNTY-KENOSHA COUNTY IL-WI METROPOLITAN DIVISION
|
9.2
|
8.5
|
10.1
|
0.7
|
-0.9
|
CHICAGO-JOLIET-NAPERVILLE,
IL-IN-WI MSA
|
8.6
|
8.3
|
10.0
|
0.3
|
-1.4
|
DANVILLE
MSA
|
12.5
|
12.4
|
11.9
|
0.1
|
0.6
|
DAVENPORT-MOLINE-ROCK
ISLAND, IA-IL MSA, IL PART
|
9.1
|
7.8
|
9.1
|
1.3
|
0.0
|
DAVENPORT-MOLINE-ROCK
ISLAND, IA-IL MSA
|
8.0
|
6.9
|
8.2
|
1.1
|
-0.2
|
DECATUR
MSA
|
12.9
|
12.4
|
13.9
|
0.5
|
-1.0
|
KANKAKEE-BRADLEY
MSA
|
11.9
|
11.2
|
12.9
|
0.7
|
-1.0
|
PEORIA
MSA
|
9.8
|
9.4
|
10.1
|
0.4
|
-0.3
|
ROCKFORD
MSA
|
12.9
|
11.7
|
13.0
|
1.2
|
-0.1
|
SPRINGFIELD
MSA
|
8.2
|
7.7
|
8.8
|
0.5
|
-0.6
|
ST.
LOUIS, MO-IL MSA, IL PART
|
9.1
|
8.5
|
10.0
|
0.6
|
-0.9
|
·
Job creation legislation for high
unemployment counties. Rep. Bill Mitchell (R-Forsyth) is
sponsoring job creation legislation to address the chronically high
unemployment in Decatur/Macon County.
“My
legislation creates tax incentives for employers in high unemployment counties
such as Macon County, which consistently has a jobless rate well above the
state and national averages,” Mitchell said. “Decatur had the second-worst economic decline
in all of America last year. This is a
crisis that can no longer be ignored by the powers-that-be in Springfield.
House Bill 6013 would provide two tax incentives for
employers in high unemployment counties:
1. Employers located in the county would
receive a tax deduction for a portion of the costs associated with providing
workers’ compensation insurance.
2. Businesses that employ at least 5 new
employees in the county would be eligible for an Economic Development for a
Growing Economy (EDGE) tax credit. The EDGE program provides tax credits to
qualifying companies equal to the amount of state income taxes withheld from
the salaries of employees in the newly created jobs.
HB 6013 would apply to high unemployment counties across Illinois,
including Macon, Vermilion and Winnebago counties. For more information, please click here.
Motor Fuel Prices
·
Price of gas approaching $4.00/gallon.
Many Illinoisans have become accustomed to paying record-high gas prices
to commute to work, shopping, and places of worship. Growing demand for crude oil from China,
India, and other fast-growing countries has led to the world price of crude
rising above $100/barrel, which all by itself represents more than $2.00 per
gallon of gasoline or gasohol. However,
additional tax policies and environmental policies imposed on Illinoisans further
increase the price of the essential commodity.
Illinois is one of only 9 states that charge both motor fuel
excise taxes (20.1 cents per gallon on gasohol, and 22.6 cents per gallon on
diesel fuel) and a separate state sales tax on motor fuel. Further sales taxes are charged by local governments
and, in the six-county Chicago area, by the Regional Transportation Authority
(RTA) to provide funding for area mass transit.
In addition, federal environmental motor fuel regulations applied
to so-called “nonattainment areas,” such as St. Louis and Chicago, further add
to the cost of motor fuel sold in these areas because the motor fuel must be
refined differently from standard gasoline.
The effect of these federal regulations becomes especially intense
during the summer when demand for motor fuel is at its height.
Potholes
·
Thawing, cracked asphalt and concrete
drive eruption of potholes throughout Illinois.
Aging concrete, which lies under the asphalt, is likely to develop
cracks due to changes in temperature and stress from heavy motor vehicles. With Illinois’ substandard infrastructure and
massive Road Fund motor fuel tax diversions, much of Illinois’ 145,342 miles of
road and highway surface needs repairs.
Weather conditions in the winter of 2013-14 have speeded up this process
of road life-cycling and made an unprecedented quantity of major maintenance
repairs necessary.
This mileage is maintained by the State, the counties, the
municipalities, and the townships. A
complex Road Fund distribution formula governs how the inadequate sums of money
raised from motor fuel taxes, and not diverted to other uses, are doled out to
the road departments of these units of government. The General Assembly is likely to be asked in
the near future for supplemental funds from the severely stretched FY14 budget
to cover the cost of spring 2014 emergency road repairs throughout the State.