School funding; “extended fiscal hangover”

Governor calls special session for school funding reform
Governor Rauner called the House and Senate back into session this week to get an agreement on a new school funding formula. The state budget which was passed a few weeks ago contained a requirement that all school funding go through an “evidence-based” formula. Without such a formula in place, no state money can be distributed to Illinois’ more than 800 school districts. We need to get to work on passing legislation to put this formula in place so that schools will get their funds in time to start classes.

Earlier this spring, the House and Senate passed Senate Bill 1, a bill to enact a new school funding formula. Unfortunately, while it has many good points, it also includes a bailout of Chicago’s public school pension system. Including this bailout in the bill would mean that half a billion dollars of education funds will not go to our local schools, but will instead go to Chicago. Governor Rauner said last week he would like to strike this section out of the bill and deal with it separately, while putting the new education-funding formula in place.

However, Senate Democrats put a procedural hold on the bill and refused to send it to the Governor for action for two months. Now we hear that they will send him the bill on Monday. My question is: why not today? Why wait two months?

By delaying for two months in sending the bill to the Governor, Democrats have created an artificial crisis and are playing politics with our kids and their education.

If they don’t send the bill to the Governor he cannot act on it. If he cannot act on it, we cannot resolve this matter. If we cannot resolve this matter, schools will not get their money on time. There is no more time for endless meetings or procedural maneuvers. It is past time to send this bill to the Governor.

Governor Rauner has called us into special session this week and next week in order to get some movement on this issue. Our schools and our students should not have to wait any longer for their funding. We need to get this done now.
Illinois to face “extended fiscal hangover”
S&P Global Ratings said last week the odds of Illinois’ credit falling to below investment grade in the next year has “substantially diminished,” but Illinois will “suffer an extended fiscal hangover” from the two-year budget stalemate. Illinois has the lowest credit rating of any state and agencies had warned of another downgrade to “junk” status if lawmakers didn’t approve a budget. The stalemate between Gov. Bruce Rauner and the Democrat-controlled Legislature began in 2015. This month, legislators approved a budget with an income tax increase in spite of Rauner’s vetoes and my No votes. S&P said the outlook on debt ratings is stable.

Fitch Ratings affirmed the state’s BBB low investment-grade rating, citing the enactment of a budget for the first time in two years. Fitch attributed its rating affirmation to the legislature’s enactment earlier this month of a fiscal 2018 budget and permanent income tax rate increases over the governor’s vetoes. It said the two factors should “significantly reduce the near-term liquidity stress that had threatened the state’s investment-grade rating.”

Moody’s Investors Service last week said a downgrade remains possible in the next two years. Moody’s put Illinois under review for a downgrade earlier this month, after the state entered its third fiscal year without a budget. That would’ve made Illinois the first U.S. state to have a rating below investment grade, and cost taxpayers millions of dollars more.

Last week, Moody’s affirmed Illinois’ rating of Baa3 — which is one notch above “junk.” Moody’s noted there are still big challenges ahead and there’s still a possibility of a downgrade within the next year or two. The ratings are important because they help determine the interest rates at which the state borrows money; the worse the rating, the more taxpayers pay. Moody’s also emphasized that the state must reduce its $14 billion bill backlog.

Job growth remains below national average – June unemployment rate increases slightly
The Illinois Department of Employment Security (IDES) announced that the state’s unemployment rate increased 0.1 percentage points to 4.7 percent in June and nonfarm payrolls increased by 8,600 jobs, based on preliminary data provided by the U.S. Bureau of Labor Statistics (BLS) and released by IDES. Job growth figures for May were revised up sharply to show an increase of 11,300 jobs rather than the preliminary estimate of 2,400 more jobs.

June’s monthly payroll figure kept Illinois’ job growth well below the national average. In the first half of 2017, payroll growth is better than it was last year, but is growing at only half the pace of 2015 for the same six-month period.

The state’s unemployment rate is 0.3 percentage points higher than the national unemployment rate reported for June, which increased to 4.4 percent. There is some good news, however, as Illinois’ unemployment rate is 1.2 percentage points lower than it was this time last year, when it was 5.9 percent. At 4.7 percent, the Illinois jobless rate has come down a full percentage point since the beginning of this year.

Honoring the 33rd Division
Tuesday morning I was honored to stand with Mike Freed in Gibson City beside the new sign designating Illinois Route 54 as the 33rd Division Memorial Highway. Route 54 has long been designated in honor of the 33rd, but it lacked the appropriate signage. Thanks to Mike, we were able correct this oversight and give these Illinois soldiers the recognition they deserve.

This year marks the centennial of America’s entry into World War I. The 33rd Division, made up of soldiers from Illinois, was one of the units created for the rapidly expanding Army in 1917. The 33rd deployed to France in 1918 and played a pivotal role in the Meuse-Argonne offensive. The offensive was part of a major push by the Allies during the fall of 1918 which helped to bring the war to an end. After the war, the 33rd returned home and continued as part of the Illinois National Guard. When America entered World War II, the 33rd again answered the call, this time in the Pacific.

In 1968, the 33rd Division was formally deactivated. But its golden cross insignia lives on with the Illinois National Guard. The designation of Route 54 to honor those who served in the 33rd gives us yet another way to preserve the memory of these brave Illinoisans for future generations. My thanks to Mike for his efforts and to all those who have served in the defense of our state and our nation.

Did You Know
While Illinois is usually thought of as a very flat state, it actually has quite a bit of difference in elevation from one end to the other. The highest point in Illinois is Charles Mound near the Wisconsin border at 1235 feet, while the lowest point is in Alexander County very near the southern tip of the state at 279 feet. Most of the 106th district is between 600 and 800 feet of elevation.