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IL: Week in Review – State lawmakers return for veto session; no action on pension reform

By   /   November 30, 2012  /   No Comments

The Illinois state flag.

By Jayette Bolinski | Illinois Watchdog

SPRINGFIELD – State lawmakers converged on the Illinois Capitol this week for the first week of the fall veto session and addressed a variety of issues, none of which involved pension reform.

Senate signs off on corporate tax transparency measure

The Illinois Senate on Wednesday approved a plan to require some companies doing business in Illinois to reveal income tax information to the public.

Lawmakers voted 30-27 in favor of the proposal, Senate Bill 282. It now goes to the Illinois House for consideration.

Bill supporters, including a variety of citizen groups, Democratic Senate President John Cullerton and Democratic Rep. Barbara Flynn Currie, say disclosure would help lawmakers and the public evaluate the state’s tax code and its handling of tax breaks and incentives for business.

Critics, meanwhile, say it is anti-business legislation that presumes corporate wrongdoing.

Cullerton on Tuesday said he does not consider the proposal “business unfriendly” and noted that Illinois’ temporary income tax hike expires on Jan. 1, 2015.

If Senate Bill 282 becomes law, corporations will be opening their books to the state just in time for the expiration – and just as the next governor will be on the hunt for new money to work with.

“We are just saying that you should disclose information about your taxes. For publicly traded companies, they already disclose a lot of information to their shareholders. Why not to us here in the state of Illinois?” Cullerton said. “The legislators that are going to be making these decisions about our taxes, we have to have this information.”

During a Senate debate on the bill Wednesday, Sen. Matt Murphy, a Republican from Palatine, urged Cullerton to rework the proposal “so that we can actually have something that makes some sense.”

“The idea that we’re going to take private taxpayer information in this manner at its core sends the wrong message,” Murphy said.

Steve Stanek, a research fellow at The Heartland Institute and an expert on Illinois tax matters, suggested the bill is less about transparency and more about moving the state to a progressive tax structure.

“I think it’s legitimate to ask, ‘Why are two-thirds of these public companies not paying taxes?’ OK. You can ask the question and you should be able to get an answer. If you want to argue that all corporations should be paying some tax, OK you can make that argument,” he said.

“But don’t tell me you’re doing this for transparency to benefit Illinois citizens. You’re doing this because you want to squeeze a lot of money out of companies. You want a progressive tax code. I think progressive tax codes are often very damaging because there again you’re picking winners and losers.”

Ex-lawmakers land lucrative state appointments after supporting tax hike

Two former Democratic lawmakers who voted for a “temporary” 67-percent state income tax hike last year were approved by the Illinois Senate for taxpayer-funded jobs on Wednesday.

Senators voted 33-16 to confirm the appointment of former state Rep. Bob Flider as director of the Illinois Department of Agriculture. Flider, of Mount Zion, earns $133,273 a year in the post. He has no agriculture experience but was appointed by Gov. Pat Quinn in February.

Flider voted for the temporary tax hike during the January 2011 lame-duck legislative session after campaigning against it during the 2010 election, which he lost.

Republican Sen. Dale Righter of Mattoon pointed out that Flider flip-flopped by voting for the tax hike after campaigning against it. But Sen. Mike Frerichs, D-Champaign, defended Flider, saying he has done a capable job in the Agriculture post.

Righter said Illinoisans increasingly “look at the Capitol building with disgust” over such appointments.

“They say, ‘You know what? That building more and more is filled with people who are taking care of each other,’” he said.

The Senate also confirmed the appointment of former state Rep. Mike Smith of Canton to the Illinois Educational Labor Relations Board, a position that pays about $94,000 a year. Quinn first nominated Smith for the three-year appointment in June 2011.

Smith also voted in favor of the temporary tax hike after losing his bid for re-election.

Smith’s appointment was confirmed in a 33-21 vote Wednesday. Bivins noted that Smith is unqualified to sit on the board under state statute because he lacks the required five years of direct experience in labor and employment relations.

Sen. David Koehler, a Democrat, said the auditor general weighed in on the matter and determined that Smith had enough experience during his 16 years as a state representative to qualify for the post. Smith was a member of and chairman of the House Elementary and Secondary Education Committee when he was a representative.

The House does not vote on executive appointments.

State Rep. La Shawn Ford says he’s innocent of federal bank fraud charges

Illinois Rep. La Shawn Ford was indicted Thursday on federal bank fraud charges for allegedly getting a $500,000 line of credit to rehabilitate property but using the money to pay for his 2006 campaign for the Legislature and other personal expenses.

Ford, 40, a Chicago Democrat, is charged with eight counts of bank fraud and nine counts of submitting false information to the bank in a 17-count indictment returned by a federal grand jury Thursday. It is unclear when he will be arraigned in U.S. District Court in Chicago.

Ford is innocent and only recently became aware of the issue, according to a statement he posted on his website Thursday. He also invited constituents, but not the media, to a meeting at his Chicago office Friday morning.

“I believe I did not break the law, and I look forward to the truth being told and justice being served,” he said in the statement.

Ford represents the 8th District on Chicago’s west side and has been a lawmaker since 2007. He was a real estate investor on the side and owned a firm called Ford Desired Real Estate.

According to the indictment, Ford obtained a $500,000 increase and a two-year extension on a line of credit, as well as multiple advances, from the failed ShoreBank by saying he intended to use the money to rehabilitate investment properties in Chicago.

Instead, he allegedly used the money to pay for car loans, credit cards, other mortgages, payments to a Hammond, Ind., casino, and for his 2006 campaign for state representative.

Ford is not accused of any wrongdoing after he was elected in the fall of 2006, federal authorities noted Thursday.

House: No money for state worker pay raises next year

The Illinois House on Wednesday approved a resolution that it will include no money for state employee pay raises in the upcoming budget.

House Speaker Michael Madigan called the vote a clear message from lawmakers to Quinn and union representatives negotiating a new contract “that we don’t’ see room for salary increases. We just don’t see it.”

Madigan put forth the resolution, House Joint Resolution 45, which also says the size of the state’s workforce is not subject to collective bargaining.

In a statement, the American Federation of State, County and Municipal Employees Council 31 said the union offered to forgo pay raises in exchange for concessions from the state and that state workers voluntarily have done more than anyone else to help the state close its budget gap. Anders Lindall, AFSCME spokesman, noted that the union agreed in 2010 and 2011 to unpaid furlough days, wage deferrals, health plan changes and more to save the state $400 million and that it agreed to no pay raises for the upcoming year.

Gov. Pat Quinn’s administration is in contract talks with the AFSCME, which represents 35,000 state workers. Just before Thanksgiving, Quinn announced the state would no longer extend AFSCME’s contract, which expired in June. Negotiations between the two sides are ongoing, however.

Quinn this week said he told the union there is no money for raises in a new contract and that he appreciates state workers’ public service.

“At the same time, if the state has these severe financial challenges, we’re all going to have to realize that that’s the reality and we’re not going to be able to have raises,” he said.

Illinois is broke to the tune of $200 billion. The average Illinois state employee cost-of-living allowance during the past five years was 4.25 percent, while the Consumer Price Index has averaged an increase of 1.95 percent between 2007 and 2010, according to the resolution.

Lindall said the resolution limits the rights of workers and undermines the state employee collective bargaining process.

Candidates jockey for Jackson Jr.’s U.S. House seat

The field of candidates who want the Congressional seat of former U.S. Rep. Jesse Jackson Jr. continues to expand.

Jackson, a Chicago Democrat who held the 2nd Congressional District seat since 1995, resigned Nov. 21. He had been on a leave of absence for several months, reportedly for treatment of mental-health issues. He also was the subject of investigations by the FBI and the House Ethics committee into possible misuse of campaign funds.

As of Friday, the following Democrats had indicated interest in the seat, according to media reports:

  • Former U.S. Rep. Mel Reynolds – Reynolds was a member of the U.S. House from 1993 to 1995, but he resigned after being convicted in 1995 of statutory rape involving a 16-year-old girl who worked on his campaign. He also was convicted in 1997 of 15 counts of bank fraud and lying to investigators.
  • Former U.S. Rep. Debbie Halvorson – Halvorson, a former state senator and Crete township clerk, served in the U.S. House from 2009 to 2011. She ran against Jackson earlier this year but lost to him in the primary.
  • State Sen. Toi Hutchinson – Hutchinson has been a state senator since 2009, when she was appointed to fill the unexpired term of Halvorson, who’d won election to Congress. Hutchinson was Halvorson’s chief of staff.
  • State Sen. Donne Trotter – Trotter has been a state senator since 1993, and before that he was a state representative between 1988 and 1993.
  • Robin Kelly – Cook County’s Chief Administrative Officer. Kelly also was a state representative and chief of staff for former state Treasurer Alexi Giannoulias.
  • Will Burns – A Chicago alderman representing the city’s 4th Ward. He was a state representative from 2008 to 2011.
  • Napoleon Harris – A former NFL linebacker, Harris will join the Illinois Senate in January after winning the seat formerly held by James Meeks, who did not run for re-election.
  • Anthony Beale – Beale is in his third term as a Chicago alderman representing the city’s 9th Ward.

Contact Jayette Bolinski at jayette.bolinski@franklincenterhq.org. Find Illinois Watchdog on Facebook and follow us on Twitter @ILSthouseNews.

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