QUOTE OF THE DAY
Sun-Times: Chicago pension crisis balloons, underscoring calls for reform
Chicago’s unfunded pension obligations have ballooned to $37.3 billion — a more than three-fold increase since 2003 — because of inadequate employer contributions, declining investment income and a shrinking base of active employees, a taxpayers’ watchdog group has concluded.
The Civic Federation’s latest report on the sorry state of the Chicago area’s 10 public employee pension funds does not factor in a Chicago pension reform bill signed by Gov. Pat Quinn that saved the Municipal Employees and Laborers pension funds.
But Civic Federation President Laurence Msall said the report nevertheless underscores the need for Mayor Rahm Emanuel and police and fire union leaders to forge an agreement on pension reforms and for the Illinois General Assembly to approve it during the fall veto session.
Sun-Times: Federal appeals court rules against city retirees on health care
A federal appeals court has given Mayor Rahm Emanuel the green light to save $27 million in 2015 by forging ahead with a three-year phase-out of the city’s 55-percent city subsidy for retiree health care.
In July, the Illinois Supreme Court ruled that subsidized health care premiums for state employees are protected under the state Constitution and that the Illinois General Assembly was “precluded from diminishing or impairing” that benefit.
Attorneys representing the city’s 28,000 retirees and their dependents argued that the high court ruling “substantially increased” their chances of prevailing on the merits.
NBC Chicago: Rahm Hangs a ‘For Sale’ Sign on Chicago City Council
How much money would it take to buy the Chicago City Council?
Would $2 million do it? $5 million? $10 million?
Clearly, someone out there in the world thinks the City Council can be bought.
State Journal Register: Illinois universities competing for students
As public university enrollment declines or remains flat, Illinois schools are competing to recruit students from across the country and around the world.
Fewer students are graduating from the state’s high schools and many of them decide to attend college in another state, according to university officials. The combination of climbing college tuition and a struggling economy is also contributing to enrollment woes, they said.
“The recession certainly played a role at SIU and many other universities across the country,” said Rae Goldsmith, chief marketing and communications officer at Southern Illinois University at Carbondale.
Chicago Business Journal: Chicago a magnet for business travel in second quarter of 2014
Chicago has its problems. That’s been a known for a while about the so-called Second City.
But what has just become known is tha anAmerican Express Global Business Travel study of business travel-related spending in the second quarter of 2014 found Chicago to be the top domestic business travel destination in the nation for the quarter. The findings are based on bookings made through the American Express Global Business Travel unit. San Francisco was second on the list, and New York could do no better than third.
What’s more, the Chicago-New York city pairing ranked as the route for which the most domestic air tickets were issued in the second quarter of 2014.
WSJ: The New Bureaucratic Brazenness
We’re all used to a certain amount of doublespeak and bureaucratese in government hearings. That’s as old as forever. But in the past year of listening to testimony from government officials, there is something different about the boredom and indifference with which government testifiers skirt, dodge and withhold the truth. They don’t seem furtive or defensive; they are not in the least afraid. They speak always with a certain carefulness—they are lawyered up—but they have no evident fear of looking evasive. They really don’t care what you think of them. They’re running the show and if you don’t like it, too bad.
And all this is a new bureaucratic style on the national level. During Watergate those hauled in and grilled by Congress were nervous. In Iran-Contra, Olllie North was in turn stoic, defiant and unafraid to make an appeal to the public. But commissioners and department heads now—they really think they’re in charge. They don’t bother to fake anxiety about public opinion. They care only about personal legal exposure. They do not fear public wrath.
All this became apparent in the past year’s IRS hearings, and was pronounced in Tuesday’s Secret Service hearings.
Built in Chicago: 7 of the fastest growing Chicago tech companies that are hiring right now
Chicago has quite a few HR tech companies, but none like UrbanBound. UrbanBound doesn’t focus on the process of hiring employees, rather it focuses on helping hires move to their new city once they have signed on the dotted line.
The startup saw a lot of companies wasting money on relocation stipends. Something that was like “throwing money at the problem, but not solving the problem,” CEO and co-founded Michael Krasman previously said to Built in Chicago. “Employees will still show up on the first day of work with a lot of personal business unsettled.”
To solve that problem, UrbanBound lines up all the resources future employees need to move. The website includes services to help find movers, apartments, new dentists, information to calculate relocation tax deductions, and tools help manage and track moving expenses. The company has doubled its employee base in the past year to over 30 employees and will likely do so again this year said Krasman. UrbanBound is looking for developers, business development specialists and customer service representatives.
Chicago Tribune: Few red light camera refunds, spikes unexplained
City Hall has promised 126 refunds to drivers tagged for $100 fines during suspicious spikes in red light camera tickets discovered by a Tribune investigation but upheld thousands of other tickets issued at the same times — all without explaining what caused the sudden surges.
The refund letters dated last week are the first public acknowledgment by the city that some drivers were targeted in error by a camera system prone to ticket spikes — some lasting weeks — that the city says it never noticed.
Mayor Rahm Emanuel’s administration offered to review nearly 16,000 tickets issued during spikes exposed by the Tribune in July, and about 3,300 responses came back. A Tribune review of who got those letters and the way the appeals are being conducted raises new questions about the city’s effort to restore confidence in Chicago’s beleaguered camera program.
Chicago Tribune: Emanuel borrows to make Michael Reese payments after failed Olympic bid
Mayor Rahm Emanuel has borrowed more than $21 million to start paying for the former Michael Reese hospital site that was bought as part of former Mayor Richard M. Daley’s failed bid for the 2016 summer Olympics.
City Hall must now find the money to pay off both those loans and the $14.2 million or so due next year for principal and interest on the South Side property. Taxpayers will be on the hook for as much as $134 million during the next decade — the $91 million purchase price plus about $43 million in net interest and development costs — unless the city can find a company to start developing the land.
Costs could go even higher because Emanuel has borrowed money to make the initial Reese payments and is thinking about borrowing more for future payments. So far, the city’s payments have only covered interest costs on the complex deal, meaning the city has borrowed to pay interest and not principal.
Chicago Tribune: Emanuel won’t rule out fee hikes in 2015 budget
Mayor Rahm Emanuel said Wednesday he will balance the 2015 city budget without increasing property, sales or fuel taxes, but did not rule out raising other fees.
With his new spending plan a few weeks away, the mayor pointed out he has stayed away from making the politically dangerous decision to hike any of those three taxes in his prior budgets. Ahead of the city election in late February, Emanuel promised to do so again, following a similar pledge by his budget director during the summer.
“We balanced three budgets in a row (while) holding the line on property, sales and gas tax, and finding efficiencies and reforms in the system,” the mayor said at an unrelated news conference. “On my fourth budget, we will hold the line on property, sales and gas tax, and put money back in the rainy day fund, and continue to look at the system as a whole to find efficiencies and reforms and things that were duplicative where you can do better.”
Crain’s: ‘Real’ Chicago home property taxes climb 50 percent — in five years
If you think the property tax bill on your house has been become increasingly painful, it has, a revealing new study shows. But it’s even worse for those who own commercial property, especially in Chicago.
The new study comes from the Civic Federation, a fiscal watchdog group that takes an annual look at effective property tax rates in Chicago and nearby suburbs. (I’ll explain in a minute what the federation means by “effective tax rate.”)
With property values only now beginning to tick up after the great subprime recession and governments asking for more tax revenue every year, the result is pain, big pain, with an average Chicago homeowner paying 50 percent more than five years ago as the federation counts. Homeowners in communities such as Arlington Heights, Oak Park and Orland Park have been whacked nearly as badly or even worse. Commercial property owners in Chicago proper have been hit with bills twice what they were.
WSJ: U.S. Job Growth Rebounds in September
U.S. job growth rebounded in September and the jobless rate fell below 6% for the first time since mid-2008, suggesting the labor market is improving faster than previously thought.
Nonfarm payrolls grew a seasonally adjusted 248,000 last month, the fastest pace since June, the Labor Department said Friday.
Revisions showed stronger job growth in prior months than previously estimated. The economy added 180,000 jobs in August instead of the initially reported 142,000. It created 243,000 in July, up from an earlier estimate of 212,000.
CARTOON OF THE DAY
