Is an Illinois Flat Tax a Fast Track out of Debt?

It’s no secret Illinois is in a financial bind: A stack of unpaid bills totaling more than $8 billion is proof. Some people say the state would dig itself out quickly if it switched from a flat, 5-percent income tax for everyone to a progressive tax in which the wealthiest Illinoisans pay a higher percentage. But opponents say this is just a ruse for a huge tax increase that will only feed lawmakers’ desire to spend beyond the state’s means. We’ve got both sides at rebootillinois.com today. What do you think?

 

 

Chicago Civic Committee: Illinois Pension Can’t Be Fixed

Yesterday we posted that Gov. Pat Quinn’s office now says the state’s pension liability is $95 billion. One group that has been advocating long and hard for pension reform now says the system can’t be fixed. Civic Committee of the Commercial Club of Chicago has a four-point plan: eliminate all cost of living increases, impose a salary cap at which pensions are calculated, raise the retirement age to 67 and shift all pension costs to local bodies (translation: school districts) over 12 years.

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Illinois is marching to the edge of its own financial cliff

Illinois is marching to the edge of its own financial cliff by failing to control its ever-growing pension costs, says the leader of the Illinois Chamber of Commerce. When the market collapsed in 2008, so did the bottom lines of the state’s pensions. “While the nation went through the worst recession in modern history, Illinois’ public pension funds still were projecting healthy returns with their heads firmly in the sand,” writes Doug Whitley. http://bit.ly/STkLId
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Congrats, Dems… Now What Are You Going to Do About This Mess

Illinois Democrats in the General Assembly won big Tuesday, and now have the votes to override any veto by Gov. Pat Quinn. The Chicago Tribune congratulates the Dems. Their prize, says the Tribune, is ownership of a financial disaster largely of their own making which they must now fix – probably without much help from across the aisle.
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With IL Budgets Alreayd Slashed, So Happens When Tax Hike Expires?

Think things are tight now in the state budget, which this year saw slashed $300 million from education so the state could pay down bills and make the required payment to its pension systems? Imagine what it will be like when the current tax hike expires and the state must make do with a reduction of around $7 billion in tax revenue. Or should we say “if” the tax increase expires as scheduled?

Fact of the Day — Prison and other facility closures are projected to save $82 million in fiscal 2013. That’s only 1.3 percent of the state’s $6.5 billion current backlog of unpaid bills. (State Budget Crisis Task Force Illinois Report, Illinois Comptroller’s Office)

Reboot Illinois’ Pension Amendment Guide

Been wondering about how to cut through all the noise and debate over the pension amendment? Here’s Reboot’s handy infographic on the ballot question…

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Amendment 49: Harmless Gesture or Sneaky Ploy

Ballot amendment 49: harmless gesture toward pension reform or sneaky ploy to slash retirement benefits for millions? The Chicago Tribune investigates. House Speaker Mike Madigan’s office clearly has no use for advocates of the latter theory: “”Those are legal minds that I wouldn’t hire to get me out of a traffic ticket,” says Madigan’s spokesman.

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Finke: Officials Admit IL has a financial problem, but few have solutions

“Nag, nag, nag,” went the reaction in some quarters to last week’s stinging report on Illinois from the State Budget Crisis Task Force. Illinoisans hardly needed reminding that their state is in serious financial trouble, said the report’s critics. But as Statehouse reporter Doug Finke notes, “maybe there’s some value on the nag factor, reminding people the problem is still there.” Finke continues: “You’d be hard pressed to find a candidate for state office who doesn’t acknowledge that the state has severe financial problems. You’d probably be equally hard pressed to find a candidate willing to spell out in detail how those problems should be solved.”

Illinois Cut 3% from K-12 Budget in FY13

Due to pension debt, Illinois cut 3 percent from its K-12 education budget in fiscal 2013. Commission on Government Forecasting and Accountability, reported in the State Budget Crisis Task Force Illinois Report