I have been involved in government in Illinois in two capacities- municipal and school board. Both have been elected offices, but essentially volunteer work. In both capacities, I have seen amazingly dedicated employees work hard for the benefit of their communities. In each case, I have watched how difficult it is to budget and plan-always the bottom line job of a trustee- in Illinois. It would be easy to rail about Springfield and have a snap diagnosis and cure. I am not familiar enough with the nuanced system of committee work and feudal serfdom to Michael Madigan to have such a “cure” for our state. But I am bone weary of both the specter of endless borrowing against a phantom recovery and the impetus for new taxes. It is like giving more allowance to the kid who repeatedly wastes and gambles his dollar away. There is no motivation for change. And change is what we need.
Illinois has more units of government than almost any state in the union. Each unit has overlapping and duplicating hierarchies. For example, every school district has a pyramid of at least a superintendent, financial director, and curriculum coordinator. My district was elementary, and educated 900 children. They did a great job. But administrative salaries, not including principals, consumed a half million dollars per district. There are four other elementary districts within five miles with almost identical demographics. Merging these school districts will not save the state much money: these districts receive very little state funding- it was 6% of their budget when I was on the board. Property taxes are high, and the homeowners like to have control of all that cash flowing out. There is no desire or motivation to consolidate. The autonomy really does not affect the state- until pension time. And then, the state’s system collapses upon itself. Think health care/social security/medicare. Only local.
When it is time to retire, administrators and municipal supervisors are paid based on their top years of service. Most worked in schools or towns at a much lower rate of pay for decades, and so the actuarial tables are wildly out of sync. Multiply this schematic by myriad units of government utilizing the same protocols, and you will see that the pension funds ALONE are in great danger of bankrupting Illinois. This thumbnail doesn’t even comprehend the double-dippers, or those politically rewarded phantoms who park in phantom jobs. The system is broken. The second irony is that the state has issued an edict that all communities must have their pensions fully funded by 2021, while placing a tax cap on property taxes. Municipalities received a .01% increase in revenue via the tax cap last year, but this mandate required them to divert operational funds to shore up the pension funds. Service cuts are the only answer for most towns to balance the budget and meet these obligations.
Meanwhile, our governor and legislators are unable to take a long term look at the unique labyrinth of Illinois and make any cuts or changes. They (and I am speaking of the majority here) wish to do what they forbid all other units of government to do: raise taxes. They wish to ignore legislation that requires them to fund the majority (in most universes, 51%, in Illinois, never even close) of education, and to return 10% of state income taxes to the municipalities where it was collected. They plan to just keep the 3/10 of the municipality’s share. Why the paralysis? Could it be that with such a large percent of the state on governmental payroll or retirement programs, that constituency is too big of a voting block to allow even dialogue about pension reform? Cowardice.
We are living in uniquely difficult times, and we cannot use the same protocols. I could deal with paying more if I believed that there was a concerted long term effort to remediate and rework the budget process in Illinois. Unfortunately, the legislature is saddled with a very hard model to make progress with. Local projects are sponsored by legislators in order to benefit their communities-and in most cases, this is representative government in its finest execution. The problem is that the underlying, day-to-day budgeting is crippled and underfunded. Our state payments to schools, Medicare and retirement health care are consistently late. If we continue the same old behavior, we will borrow to make these payments, and sink even further into debt.
PEW, a charitable trust think tank that analyses state government for creative and functional solutions, rates Illinois dead LAST in pension management and near last in health care.
“While the economic crisis and drop in investments played a role, Illinois’ gap is primarily the result of the state’s inability to save for the future and manage the costs of its public sector retirement benefits,” said Susan Urahn, managing director, Pew Center on the States. “The growing bill coming due could have significant consequences–higher taxes, less money for public services and lower state bond ratings. With uncertain stock market performance and swelling numbers of ‘baby boomer’ retirees on the horizon, policy makers cannot wait this crisis out; they must act responsibly now.”
This issue will consume our state revenues for years to come. We will be able to expect even less from Illinois in the roadway systems, schools, infrastructure. We will pay more and more.
The state needs an overhaul. A creative mind could create tax incentives for consolidation of redundant services. ( In fact, at the municipal level, many towns are merging service operations to conserve funds and create efficiency) A new pension protocol must be formulated for new hires. Superfluous governmental bodies that are parking spots for political cronies- like Dr. Charles Flowers’ Regional Office of Education- should be eliminated . That is only a start. We have to rethink everything.
Maybe Pat Quinn’s suicide mission to raise taxes, cut funding to municipalities and the public service sector (which is picking up all the abandoned state mental health care ) is an altruistic deed. Perhaps our Don Quixote will perform a budget balancing act before being kicked to the curb. I tend to doubt this, based on my 10 years of miniaturized service. Good legislators work for the people everyday. They deserve to function in a more rational and productive manner. Overhaul of the committee methodology and the power structure in Springfield is a start. Our imagery of a large body debating and formulating solutions is NOT accurate. Barter and beg is the norm. Those with consolidated power do not give wings to creative solutions. They grind down opposition instead. They maintain the status quo. It is undignified, and irresponsible.
The taxpayers of Illinois are tired of being the fiscal laughing stock of the nation. We pay. We vote. Systematic change is overdue. We need our own think tank. Fast.