Rauner’s budget out of tune with reality

Bill Knight column for Thurs., Fri., or Sat., March 1, 2 or 3, 2018

Illinois’s Republican Gov. Bruce Rauner returned to a tired, failed refrain in his Feb. 14 budget address: attacking unions, retirees and schools.

It’s the same old song and dance.

His latest budget proposes that the state escape some of its pension obligations by shifting their responsibility to local school districts and colleges, and that lawmakers dramatically cut health care.

Seeking to spend $37.6 billion from projected revenues of $38 billion, Rauner contrives $1.3 billion in savings by abandoning pension contributions and leaving those to local schools. It’s mostly an accounting gimmick since taxpayers would still be underwriting the programs, but it’d be through local property taxes, not state taxes. So the ploy would take $1.3 billion off the state’s balance sheet, and then burden local schools with the spending.

“Gov. Bruce Rauner presented us with yet another budget built with fairy dust,” said Illinois Federation of Teachers president Dan Montgomery. “He claims to be investing more money in our public schools, yet last year’s funding still hasn’t reached our most vulnerable students. Rauner claims to value educators and senior citizens, but [he] suggests defunding health care for retired teachers, all while people are increasingly reluctant to enter this important profession.”

Concerning health insurance, Rauner asked the General Assembly to remove it as a bargaining subject for state employees and retired teachers – people who agreed to work for less than the private sector in exchange for good pensions and decent health insurance.

The scheme would save the state about $700 million, including $470 million by forcing state workers to pay more, $129.4 million by dumping state assistance for the Teachers’ Retirement Insurance Program and an insurance program for retired community college workers, and $105 million by shifting some group health-insurance costs to universities. Adding $700 million to local taxing bodies is idiocy on a colossal scale.

Of course, the legislature would have to approve it, and support from the General Assembly’s Democratic majority, which is often allied with organized labor, is doubtful.

Meanwhile, less than a year after several Republican lawmakers joined Democrats to override Rauner’s veto of a tax hike, the governor presented a budget both relying on the new revenue and also criticizing legislators for increasing the personal income-tax rate from 3.75 to 4.95 percent and the corporate rate from 5.25 to 7 percent.

“Rauner’s budget plan threatens to destabilize our school systems, undermine our public universities, and create the kind of conflict and confusion that can only further damage our state’s reputation,” said Roberta Lynch, director for Council 31 of the American Federation of State, County and Municipal Employees (AFSCME). “He’s recycling well-worn assaults on public-service workers and retirees, seeking to impose unaffordably high health-care costs, undermine retirement security, and weaken union rights.

“Once again, our billionaire governor wants working people to bear the brunt of a fiscal crisis he helped create,” she added. “Public-service workers are on the job every day, often in demanding and dangerous jobs. They jeopardize their own safety to protect kids from abuse and neglect. They risk their own health to care for veterans and people with disabilities. They keep order in a prison system that’s understaffed and riven by violence.”

Plus, Rauner’s health-care plan would face court challenges and probably be ruled unconstitutional since a court order previously prohibited him from making such changes. That likelihood makes his speech more political posturing for this year’s elections than a way to reach a workable budget.

Rauner’s Republican challenger in this month’s primary election, State Rep. Jeanne Ives of Wheaton, blasted him, saying, “Governor Rauner outlined a budget that relies on the same income tax hike that he promises to ‘immediately roll back’ on the stump, and his promised property tax freeze – as inadequate as it is – becomes a massive property tax hike once he pushes pensions back on local districts.”

One of the Democratic candidates for governor, State Sen. Daniel Biss of Evanston, said Rauner’s budget would “shift costs to those who can least afford it.”

AFSCME’s Lynch, commenting the morning after Rauner’s Springfield speech, said, “What we really need is a fair tax, with higher rates for people with higher incomes and lower rates for people with lower incomes. That's the fair way to raise enough revenue to pay the state's bills and invest in public services while finally getting rich people to pay their share. Illinois needs a budget that’s responsible, balanced and fair, but Rauner’s address made clear once again that we lack a governor committed to that cause.”

A new governor pledged to that approach would be music to our ears.