The McDermed Dispatch for June 29th

The House is in Session Tuesday and Wednesday this week. The fiscal year ends on Tuesday, June 30th and a full budget has still not been signed or agreed to.

       The House held its third Committee of the Whole to discuss Governor Rauner’s proposal to create a public-private entity under the DCEO which would encourage growth and innovation. This is one of Governor Rauner’s initiatives to help spur job growth in the state. Director Schulz of the DCEO has said that red tape, mandates, and the bureaucracy that prevent the agency from doing a good job could be worked around in this new entity. Public-private partnerships have been successful on lower levels in other states and in Illinois in places like Lake, Will, and DuPage counties. Governor Rauner hopes to apply those models to the state level.
       The first panel of witnesses, including director Schulz, spoke about a need for a small and medium business program. That is where the most jobs are created and Illinois recently ranked as an F in small business friendliness. Schulz said the not-for-profit entity will be laser-focused on business development, small & minority business incubation, trade & investment, and tourism and film.
       The second panel to testify warned of potential problems with such an entity. They highlighted issues that had popped up in states like Ohio and Florida, which had in recent years created similar entities. Republican representatives pointed out that Governor Rauner’s proposal addressed the concerns raised by the panel and improved on the work of other states which the panel acknowledged. This new entity would be subject to appropriate oversight, FOIA, ethical constraints, and final approval on any projects is given to the head of the DCEO.
       This past Tuesday the House voted on the proposal from the Governor and eight additional amendments added by the Democrats. Republicans by and large voted present on the amendments and the entire bill because a universally agreed upon and much needed proposal was essentially hijacked by the subsequent amendments. Among the amendments was a sunset limitation on the entity of three years which is not enough time and would belie the commitment of the state to the program. The measure passed the House. 


       During session last Tuesday, the House voted on a bill to delay Chicago Public Schools’ payment to the teacher’s pension fund for 60 days. CPS’ finances are a mess. As a result of a deal made in the 1930’s, the state contributes very little to Chicago’s teacher pension fund. Chicago is left to handle its own school finances and years of mismanagement, borrowing, and underfunding have left them with a $634 million dollar payment to the pension system due on June 30th. Opponents to the pension holiday argued that this deadline has been known for a long time and there’s nothing that can be learned in the 60 extra days that couldn’t have been figured out 60 days ago. They say that Chicago needs to face the music and get its finances in order. Proponents said that this was only a 60 day holiday and cited an audit by Ernst and Young (an accounting firm) that said CPS will run out of cash as early as this summer without third party intervention. The bill was agreed to by the Governor and Mayor Emmanuel and appeared to be a rare opportunity for bipartisan compromise and agreement. However, the Speaker appears to have pulled his support and the vote failed to get the necessary 71 votes (as opposed to a simple majority vote).
       After the decision by the House, the Chicago Board of Education authorized $1.1 billion in new borrowing. CPS’ bond rating was just recently reduced to junk status, which means borrowing money is now much more expensive. Ernst and Young recommended that Chicago raise its property taxes to help climb out of the hole. Chicago pays some of the lowest rates in the state.

Education and the Budget

       The Governor signed HB3763 last Wednesday. This is the elementary and secondary education component of the Fiscal Year 2016 State budget. The move will fund K-12 education at over $300 million higher than the previous year, a number that closely resembles the level Governor Rauner recommended in his introduced budget. The state has underfunded its contribution to school districts for years now, but this move does increase the funding level from 89% to 92% which is a step in the right direction. Schools can now rest assured that they will open on time this year and our children’s education has effectively been removed from the crossfire in the budget battle happening in Springfield right now. I’m hoping the Democratic leaders see this as a measure of goodwill and another of the governor’s steps toward compromise and come back to the negotiating table to work through this stalemate.
       I, like all of my Republican colleagues, voted against this budget bill in the House. We acknowledged that increasing state spending on education was the right thing to do, but we voted no on all the budget bills that were put before us because they were sprung on us with little to no time to examine, quickly rammed through the House, and together they spend almost $4 billion dollars more than the state will take in this year. The entire budget as a whole is still irresponsible.
       Governor Rauner followed up by vetoing the remaining 19 budget bills on Thursday. He explained his decision in a Tribune op-ed which can be read here. The fact of the matter is that the Illinois constitution requires that the General Assembly pass a balanced budget and while other governors have let this slide in the past, Governor Rauner is committed to fiscal responsibility.

Government Shutdown Likely

       It seems increasingly likely that we will see a government shutdown. Many are asking what will happen. Much of state government will continue to operate:
• With the signing of the education component of the budget, Illinois schools will open on time.
• Prisons will stay open with correctional officers on duty.
• The State Police will stay on duty.
• Emergency Management personnel will keep working.
• A wide range of health and human services mandated by the federal government and federal courts will stay open.
• Funding transfers to local governments will continue automatically.
• The state will pay its debt obligations. If you’re waiting for a refund from the Department of Revenue, that refund is still coming.That said, there will be some problematic outcomes as well:
• Many non-essential state employees, while their benefits will continue, will see their checks stop.
• Funding for service providers will cease.
• Child care programs will stop.
• LIHEAP funding may cease.
• U of I Ag Extension, county fairs, and other programs will grind to a halt.
       I understand the serious consequences that will come with a government shutdown and I will continue, along with other legislators, to urge the legislative leaders to work together with the governor to resolve these issues as quickly as possible. 

Local News

       I recently toured the new Mokena ministry center of the My Joyful Heart Organization. This charity seeks to provide children in need with clothes, school supplies, and other necessities. They are having an open house at their new center on Saturday July 11th from 9:30am-1pm at 9981W. 190th Street, Suite I in Mokena. You can RSVP to 815-806-1700 or

        Congratulations to the New Lenox Park District on the opening of Walker Country Estates Park on June 25, and the Mokena Park District on the opening of Prairie Ridge Park, on June 27th. Parks are an important investment in our communities and enhance our quality of life. A survey found that 85% of Illinois residents visited a park in the past year and that 7 in 10 find that the property tax money spent on parks is a ‘good or excellent value’.
       Sharefest of New Lenox is sponsoring their 3rd Annual Job & Resource Fair Wednesday July 22 from 1pm-4pm at the Clarion Hotel Joliet Banquet & Convention Center. Participating are scores of local employers looking to hire local people to fill hundreds of job openings!
        I am honored to be on A Safe Haven’s Honorary Host Committee for their upcoming 5K Run to End Homelessness on July 12th in Douglas Park. Governor Rauner is Honorary Host Chair. A Safe Haven is a wonderful organization that provides the tools to homeless individuals to help them climb out of their situation.