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GOVERNMENT RELATIONS


Alliance Legislative Report 97-41

Distributed via Email: February 22, 2012

GOVERNOR DELIVERS BUDGET MESSAGE

While revealing precious few details, Governor Pat Quinn Wednesday addressed a joint session of the Illinois General Assembly with his State Budget Message for Fiscal Year 2013. While speaking in broad terms, few fiscal proposals were fleshed out enough to gauge any real affect on local school districts.

Some legislators are pointing out that the overall state budget plan proposed by the governor for FY ’13 is actually higher than the total budget for FY ’12, yet the plan includes cutting $2.7 billion from the Medicaid program and closing over 60 State facilities around the state, including: two centers for the developmentally disabled, two mental hospitals, two juvenile justice centers, 24 local offices of the Department of Human Services, 16 State Police telecommunications centers, and two prisons. The text of the governor’s speech can be accessed here.

EDUCATION FUNDING

The governor proposed to increase funding for K-12 and higher education by about $90 million. $50 million of that would be earmarked for additional investment in the Monetary Assistance Program (MAP) for college scholarships for students with financial need. $20 million would be targeted for an addition to the early childhood education budget line item. The remainder, though not mentioned by the governor in today’s speech, would likely fall in line with some of the requests in the Illinois State Board of Education (ISBE) budget for increases in bilingual programs and for programs designed to implement the recent education reform legislation.

PENSION REFORM

Any increase in the education budget proposed by the governor could quickly be wiped out by new required school district contributions to the Teachers’ Retirement System (TRS). Though no specifics were discussed, the Governor reiterated his desire to join House Speaker Michael Madigan and Senate President John Cullerton in pushing to shift part of the state’s pension obligation to the local school district.

According to the governor, $5.2 billion must come from the State’s General Revenue Fund (GRF) in FY ’13 for the state’s pension payments. This is 15% of the entire GRF revenue pool; a percentage that is growing annually. To address this, the governor said that though he wants pension reform that is “meaningful, constitutional, and fair”, but also added that “everything has to be on the table”.

The “everything” would include: “historical funding practices, employer contributions, employee contributions, the retirement age, and the cost of living adjustment”. The Speaker of the House this week also stated that “the things to look for” in a pension reform bill are: a school district contribution, the elimination or amending of the compounding cost of living adjustment (COLA), and the raising of the retirement age. These changes would apply to current participants of TRS.

Discussions on the pension reform issue, of which the Alliance has been a part of, have been ongoing in the Capitol. The governor stated in his address that his pension working group will be meeting regularly and that he wants a pension reform plan submitted by the group by April 17.

PROPERTY TAX CAP LEGISLATION APPROVED

The Illinois House of Representatives Tuesday swiftly amended and approved a bill that would limit taxing districts that are in counties under the Property Tax Extension Limitation Law (PTELL) to zero revenue growth if property values are declining overall. Specifically in SB 2073, if the total equalized assessed value (EAV) of all taxable property in the taxing district for the current levy year is less than the total EAV of all taxable property in the taxing district for the previous levy year, then the extension limitation is (a) 0% or (b) the rate of increase approved by voters.

The bill, sponsored and amended in the House by Representative Jack Franks (D-Woodstock), is identical to last year’s HB 3793 which was defeated on the House floor on a vote of 34-73-5. This time, the substantive language was added to the bill via amendment on the House floor, with no committee hearing and no recorded roll call on adoption of the amendment. The bill was then immediately called for a House floor vote where SB 2073 was approved 74-39-2.

The bill now moves to the Senate where a final vote could happen at any time. A positive vote in the Senate on SB 2073 would send the bill to the governor. Please contact your State Senator and urge a no vote on the bill. Supply data on exactly how this property tax limit would affect your school district.

This legislative report is written and edited by the lobbyists of the Illinois Association of School Boards to provide information to the members of the organizations that comprise the Illinois Statewide School Management Alliance.

Bill Text/Status: Illinois General Assembly www.ilga.gov


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