Bond Buyer: Rating Agencies Wait For Illinois Supreme Court Pension Review
A lower court ruling throwing out Illinois’ pension reforms isn’t expected to trigger any immediate legislation or negative credit action, as all eyes turn to the Illinois Supreme Court.
Sangamon County Circuit Court Judge John Belz on Friday voided the pension legislation saying the cuts violated the state constitution’s clause that protects pension benefits from impairment or diminishment, agreeing with the arguments laid out by unions and employees and retirees who filed lawsuits challenging Public Act 98-0599.
The state, knowing a legal challenge loomed, didn’t build any savings on pension contributions from the pension into its fiscal 2015 budget that runs through June 30, so there’s no immediate fiscal impact. It’s also long been clear that the state high court would have the final word on the reforms approved last December.
Chicago Tribune: Illinois lawmakers opened door to risky CPS bond deals
The legislation paving the way for Chicago Public Schools to issue $1 billion in risky debt arrived on the Senate floor with little explanation.
The sponsor, Sen. John Cullerton, told fellow lawmakers that his grasp of the bill was limited.
“I hope nobody has any questions,” said Cullerton, who is now the Senate president, when he presented the measure to his colleagues in March 2003.
Daily Herald: Hoffman Estates' property tax levy likely won't rise
Hoffman Estates’ costs and revenues are expected to rise next year, but its property tax levy likely won’t be a penny more than the $17.9 million sought last year.
“I’m very proud to say the proposed budget for 2015 has a 0 percent increase in the property tax,” Hoffman Estates Village Manager Jim Norris said at a budget workshop for the village board’s finance committee Monday.
More revenue coming from such consumer-driven sources as sales tax is a sign that the economy is continuing to improve, Norris said.
Public Sector Inc: A tale of four cities: pension reform in and out of bankruptcy
Filing for bankruptcy is not, by itself, a solution. Bankruptcy just creates time and breathing room to renegotiate obligations and enact reforms. It is this process of rearranging municipal balance sheets that, ultimately, restores solvency. But, if political interests such as the California pension system (CalPERS) or public employee union leaders browbeat a municipality into leaving pension reform off the renegotiating table, then bankruptcy becomes a feckless exercise.
Vallejo exemplifies this problem. After declaring bankruptcy in 2008, Vallejo reduced payments to bondholders; cut health-care benefits; laid off public-safety workers; and cut spending on public services – including cancelling and deferring investments in its degrading downtown area. Illustrating how deep its spending cuts were, Vallejo warned residents to be judicious with their use of the 911 system as a means of saving money, despite the fact that crime rates were higher than other comparable cities in California.
Then Vallejo hit a wall. CalPERS threatened extended litigation if Vallejo tried to address their unfunded pension system. Vallejo complied with CalPERS’ wishes. As a result, despite emerging from bankruptcy, Vallejo remains fiscally insolvent. Vallejo’s budget projects that, while revenues will grow 1.7 percent a year through the FY2019-20 budget, pension expenditures will grow 8.5 percent a year. Based on the city’s own projections, pension costs will grow to 21.3 percent of the total budget in FY2019-20 compared to 13.6 percent of the budget in FY2012-13.
Washington Times: The dreaded consequences of Obamanomics
What has been the price tag for the audacious Obamanomics experiment? How much has it all cost — the bailouts, the debt, the stimulus plans, the printing of cheap money, Obamacare and all the rest?
The answer to that question is just north of $10 trillion. That’s the sum of the $8.3 trillion added to the national debt since Sept. 15, 2008 (the day Lehman Brothers filed bankruptcy) for all the government spending, and the $3.5 trillion of easy money flushed into the economy by the Federal Reserve through the initial monetary expansion and three rounds of quantitative easing.
ChicagoNow: Chicago avoids property-tax hikes … for now
Fewer than four months out from the 2015 mayoral election, Chicago Mayor Rahm Emanuel managed to pass a budget that avoids dreaded property-tax hikes.
But the mayor’s budget does jack up the price of parking downtown. The city is hoping to bring in $10 million by raising the transportation tax collected for garage parking – weekday and weekend rates will jump to 22 percent and 20 percent of gross receipts, respectively. The budget claims the city will use this money to double the number of road-repair employees.
The parking tax marks the third time Emanuel has raised or changed parking rates to bring in more city revenue, NBC Chicago reported.
Built in Chicago: TurboAppeal raises $800K, launches service to simplify property tax appeal
CNBC:Publicly funded university spends $219K on custom table
Kean College, a publicly-funded university in New Jersey, is under criminal investigation for spending $219,000 on a custom-built conference table, reports the Daily Mail. And the school could shell out an extra $51,000 in additional fees before the table is finished.
Kean President Dawood Farahi defended the spending on the table and said, it is “small-minded” to focus so much on a school purchasing a table for $200,000, during a campus interview with a local news publication. Farahi earns about $300,00 a year and received a $200,000 bonus last year. Kean students pay more than $44,000 to earn a four-year degree.