2. FY 2013 and FY 2014 Budgets
Pension Reform
Other Legislation
Perspective of a New Legislator
Questions
3.
4.
5. FY12 FY13 Est. FY14 Est. FY15 Est. FY16 Est.
$ Change $3,309 $484 $800 -$1,649 -$1,911
General Revenues $33,797 $34,281 $35,081 $33,432 $31,521
$20,000
$22,000
$24,000
$26,000
$28,000
$30,000
$32,000
$34,000
$36,000
$38,000
6. • Initial FY13 framework set spending limit of $33.7
billion in general funds.
• FY13 supplemental appropriations have pushed
spending to $35.5 billion.
• Fed by one time revenue spike resulting from fear
of federal tax law changes
$315 million Community Care Program
$220 million DHS-Developmentally Disabled
$350 million – Group Insurance Program
$42 million Department of Corrections
15. Concerns
• Maintains record spending level established in FY13
despite the fact that FY13 was based on one time
revenues.
• Does not prepare for coming fiscal cliff in FY15 as
income tax increase is set to phase down
• Reduces old bill set aside from $800 million in FY13 to
$651 in FY14.
• Revenue estimate increased last day of session to allow
for higher spending level.
16. -$7,000
-$6,000
-$5,000
-$4,000
-$3,000
-$2,000
-$1,000
$0
$1,000
FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012
$777
$300
-$1,220
-$1,094
-$410 -$474
-$291
-$135
-$834
-$3,674
-$6,475 -$6,475
-$6,900
Millions
Note: Does not include bills held at agencies.
The backlog in December of 2012, including bills held at agencies, stood at $8.9 billion.
Comptroller estimates that FY13 ended with a total of $7.00 billion including bills at
agencies.
18. Illinois has the lowest credit rating of any state in the nation.
Every other state in the nation is operating in the same national
economy, yet we are rated worst. We’re not just like every other
state. We’re worse than every other state.
Over half of all the credit downgrades in the history of Illinois have
occurred under this administration.
We’ve been downgraded 21 times in total with 12 occurring under
Quinn.
Lower credit ratings mean higher interest payments for Illinois
taxpayers.
These downgrades will cost taxpayers hundreds of Millions of
dollars.
Illinois has one of the highest risks of default of any sovereign
government in the world.
Lately, Illinois regularly ranks in the top 10 highest default risks
with countries like Iraq, Greece, Pakistan and Iceland.
19. Illinois’ pension systems are the worst funded
pension systems in the nation.
Assets in the state pension systems are $96
Billion short of covering our estimated
liabilities.
This is a debt that will eventually have to be
paid. The payments on this debt threaten our
financial solvency.
24. Dick Ingram
Head of Teachers’ Retirement System:
“One forecast says
the TRS could be
insolvent by 2029.”
25. “ If anyone doubted the severity of the pension
problems,” the mayor said, “last week's events
[Moody’s credit rating downgrade of the City of
Chicago] should serve as something of a wake-
up call.”
"Denial," he said, "is not a long-term strategy."
26. “Chicago is also fast approaching a day of reckoning. Chicago Public
Schools last week announced 2,100 layoffs, which Mayor Rahm Emanuel
blamed on a $400 million spike in pension payments. "The pension crisis is
no longer around the corner," he said. "It has arrived at our schools."
“Moody's MCO -0.73% downgraded the city's general-obligation bonds last
week due in large part to rising retirement and debt service costs, which
comprise about a third of its operating budget.”
“Chicago plans to dump 30,000 retirees on Medicare and the ObamaCare
exchanges in 2017. Yet all savings will go toward pension payments, which
will triple in 2015.”
“The mayor has warned that the bill could force a 150% spike in property
taxes.” - Wall Street Journal, After Detroit, Who’s Next?: Creditors and Unions are Learning
a Painful, but Useful, Lesson; July 21, 2013
27.
28.
29. • Established in the mid-1990s to help universities
“attract and retain the most qualified employees.”
• An amount equal to 15 percent of the employee’s
salary goes toward a retirement savings account.
• 17,500 workers have chosen this 401(k)-style SMP.
30. 1. Based on existing SURS 401(a) retirement program of
17,500 state workers
2. Creates individual retirement accounts for current state
workers
3. 7% employer contribution, 8% employee contribution
4. State worker owns and controls the account
5. Account is Portable
31. FY12 FY13 Est. FY14 Est. FY15 Est. FY16 Est.
$ Change $3,309 $484 $800 -$1,649 -$1,911
General Revenues $33,797 $34,281 $35,081 $33,432 $31,521
32.
33. North Carolina state Senate Majority Leader Phil
Berger, “This tax only adds to the cost of hiring workers
and thus makes unemployment worse."
GOP lawmakers have passed a pro-growth plan that will
slash the state personal income tax rate to 5.75% from
7.75% by 2015; cut the corporate tax to 5% from 6.9%;
and eliminate the state estate tax.
All of this will spur growth and job creation. Yet unions and
others on the left pummel the plan as a giveaway to the
rich.” - Wall Street Journal, Moore, Stephen: Why are North Carolina
Liberals So @&%*! Angry?; June 19, 2013
34. Illinois ranks 47th in the nation in job growth.
Only three states in the nation have performed more poorly
than Illinois over that time period. (Michigan, Ohio & Rhode
Island).
Illinois has LOST almost 250,000 jobs.
During that same time period, 30 other states added jobs.
Illinois LOST over 4% of its jobs while the average state
INCREASED jobs by 1.7%.
If Illinois had simply grown at the national average, we’d
have 350,000 more jobs today.
If Illinois had grown jobs at the rate of Texas, which grew
jobs at over 10%, we’d have over 850,000 more jobs today
and almost $3 Billion in associated state revenue annually.
38. Medicaid Budget Goals Not Met in FY13
Maximus Contract in Jeopardy
Anywhere from 300,000-700,000 additional
enrollees
Additional cost upwards of $1 Billion
Healthcare study shows no better health
outcomes under Medicaid
Delivery of Best Care at Best Price is the Goal
39. Concealed Carry Legislation
Fracking
Pension Shift
Medical Marijuana
70 mph
Cell phone use
Tanning Bed Use by Minors
METRA
40. Court ordered legislation
6 months to implement
10-year process, agreed bill
Exempt Areas
16 hours training, $150 fee
Shall Carry
Local Ordinances
41. Part of Illinois Economy for 50 years
Bi-Partisan agreement over one year
Potential to Create 45,000 jobs
Severance Taxes
Adds to America’s Energy Independence
42. Speaker Madigan Committed to Shift
Universities okay with –
1% shift=2% tuition increase
Shift burden going forward, expect local bond
ratings to decrease, property taxes increase
Need other reforms first
43.
44. Medical Marijuana
70mph Speed Limit
Tanning Beds and Cell Phones
Task Forces
METRA – HR521
