"RB residents balk at tax hike suggestion"
I think Paul Stack nails it here:
"Increases for the teaching staff are disproportionate to what’s going on in the economy. "
"Anybody who talks about RB needing a referendum is disconnected from the community"
And I don't think the problem is restricted to educational institutions alone. Governments (local, state, federal) are disconnected as well.
here's the state of Ill situation - from Crane's:
This year's budget was balanced with lots of one-time revenues that presumably will not be available next year. Like $2 billion in federal stimulus money. And $3.5 billion that lawmakers directed the governor to borrow to make this year's payments to state employee pension plans.
Factor that in, and the projected 2011 deficit is $7.1 billion, according to the federation — plus the $5.7 billion still owed from 2010.
The combined $12.8 billion is nearly half of the state's general fund's operating budget — and better than 20% of Illinois' total budget, which includes operations, capital, federal programs and other matters.
Put a different way, the two-year hole in the state budget amounts to about $1,000 for each Illinoisan — man, woman and child.
Extraordinary times call for extreme measures. There probably be a moratorium on wage increases for the entire public sector - State, County, Municipalities and Schools - all the schools - from top to bottom., I don't say that to be mean - it's just the way things are. The cupboard is bare. Most forecasters are predicting at least 10% unemployment through 2011, minimum. And we need new pension systems - the two tier system - at a minimum. New hires just can't be awarded the same benefits as those who were hired in better times. Probably the existing liabilities are already unsustainable. This is not about politics - no politician wants to do what needs to be done. And people who are employed don't want to pay higher taxes, but with so many people worried about keeping a job and their already heavy load to pay, it will still be necessary to raise more money.
We need spending cuts, we need to eliminate the advantages and loopholes that some enjoy, and we need to raise more revenue generally. Compared to doing that, rebuilding Haiti will be a snap. I personally think we need to stop being the recipient of every 911 call for help and scale back on some of our foreign commitments, but that's just my personal view.
Agreed, chrishajer, that there is a disconnect and that it also shared by local, state and federal entities. When I constantly hear the term in this forum, in the context of the Villages finances, 'structural deficit', I know that is code for some kind of 'objective' need for a tax increase in the near future. I think this especially when I see the resistance of many in the town, both on the board and in town, to really roll up their sleeves to try to pare down expenses as much as possible.
During the recent debate between hynes and quinn it was said that taxes at the state level will need to be raised due to revenues being down - it reminded me of the same thing I have been hearing in town.
A quick observation on the recent massive increase to the district 96 superintendent's compensation (and which was also 'disproportionate to what is going in the economy' to use Stack's words): this was voted on by the district 96 board, and was not initiated by spending requirements to keep the district operating; the increase was not done by the administration , but by members of the board, our fellow neighbors.
On the other hand (there is always that other hand): if the governments, local, state and federal, do not get more revenue, then salaries and services will have to be cut (except in the federal case where they can print money), and can we all live with this ?
For example, do we want violent felons on the street in order to save state money? Don't we want to continue to attract the best and brightest teachers at RB in order to continue to have a good well regarded high school that is an anchor to the community for stable property, as well was community, values? We want those kids to be doing homework instead of doing other bad things, and we want the kids performing well so that when new people are evaluating whether to live in this town, they will want to choose (to pay) to live here. Same thing for the Village: can we all live with less services in the village (streets, sanitation, recreation, and the like)?
I think the largest portion of the Village of Riverside's budget, and school budgets, is salaries. Those salaries were negotiated and agreed upon and set by contract. I read something interesting the other day, about the State of Illinois' finances. Jim Nowlan, senior fellow at the University of Illinois' Institute of Government and Public Affairs is quoted as saying "We're [State of Illinois is] close to de facto bankruptcy, if not de jure bankruptcy."
http://www.chicagobusiness.com/cgi-bin/article.pl?articleId=32910
(sorry, video plays automatically there, turn your speakers down)
Bankruptcy is not available to states. But the article also states this: "While the Illinois Constitution protects vested pension benefits, that promise, like all the state's obligations, is only as good as its ability to pay." I wonder if that's part of the plan. Kick the expenses down the road far enough to force something like bankruptcy, where the state gets out of its pension obligations and is able to renegotiate their contract, like the automakers did with their expedited bankruptcy.
It's a big mess and I'm not sure how we get out of it at this point. Something's got to give though. And I agree with Jerry Buttimer as well, when he says "A referendum today would fail, because they need to cut their spending first". I think any tax-increasing referendum has a snowball's chance in hell in passing in the foreseeable future.
So, we kick the police/fire/teacher pension obligations to future generations (like we seem to be incorporating into our budget process) and then can't pay....
Sounds like a plan doomed to litigation - another expense we can push forward?
That's really interesting, but it seems like we're all rushing to the edge of the cliff together at a high rate of speed.
Good grief.
Here are a couple items in the chicago papers recently on the subject of the cost of public staff mentioed above.
my comment: Felons on the street to pay for prison staff?
saw this today in the suntimes...
http://www.suntimes.com/news/brown/2013371,CST-NWS-brown27.article
Prison barbers make almost $72,000?
Giving haircuts to inmates can lead to hairy situationsJanuary 27, 2010
BY MARK BROWN Sun-Times Columnist
Sometimes a single fact in a news story will jump off the page and leave you asking: Could that possibly be true?
That's what I was thinking when I read the report in Monday's Sun-Times by Chris Fusco and Art Golab about lawyer Michael Shakman taking aim at state patronage hiring.
» Click to enlarge image
Mark BrownThe fact that caught my attention: a barber for the Illinois Department of Corrections collected $71,862 in salary in 2008.
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And in yesterday's tribune, there was a Dennis Byrne column on same. Note the comment from Wilmette official. Since the obligations seem to come from springfield, can springfield amend these?
http://www.chicagotribune.com/news/opinion/ct-oped-0126-byrne-20100125,0,2528205.column
Because if we can't elect people who are committed to figuring out how Illinois will crawl out of an $80 billion-plus debt owed to public employee pension funds, the state surely will get flushed.
Illinois is circling the drain already, with its budget deficit running at more than $11 billion and growing each year thanks to spending for which there is no money.
For years, the state has swiped the money it needed to "balance" the budget from the irresistible billions sitting in the pension funds. Talk of state bankruptcy is no longer speculative.
That $80 billion is roughly enough to build 168 Millennium Parks, meet the CTA's capital needs 16 times over or rebuild O'Hare International Airport almost half a dozen times.
Fixing this ruinous state of affairs will require two missions impossible: End the pension fund raids by stopping the ballooning expenses of state operations, and bring the funds in line with the private sector.
The Tribune's political candidate questionnaire notes: "Health care for state employees and retirees costs Illinois $2 billion a year. Active employees pay less than 20 percent of premiums; retirees with fewer than 20 years of service pay less than 10 percent; those who worked more than 20 years pay nothing. Should state employees and retirees contribute more for the cost of their health care?" (Check out the candidates' answers at elections.chicagotribune.com/editorial/)
The questionnaire further says: "Illinois has an unfunded pension liability of $80 billion. Should the legislature reduce pension benefits for new state employees and/or require higher pension contributions from current employees?"
Public pensions aren't just crippling state government. Thanks to the legislature, local governments are crippled too. The legislature controls 18 public pension funds in Illinois, but it pays the benefit costs of just five. Local governments pay for the other 13, even though the legislature sets their benefits.
Said Wilmette Village Trustee Mike Basil on his pension reform Web site (pensionreformillinois.com), "When local government hires a new employee, for every dollar of salary paid to the employee, the local government has to spend more than (50 cents) to fund the employee's pension obligations that Springfield has dictated. Are there any private sector companies that pay more than one half of an employee's annual salary into a retirement savings plan?"
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