CHICAGO - With no let-up in tensions over a budget impasse, Illinois Gov. Bruce Rauner told House Speaker Michael Madigan Wednesday to either get behind his reintroduced policy and governance reforms or to push through his own tax hike.
Rauner’s suggestion came as he re-introduced bills tied to his so-called turnaround agenda and announced new details of a “comprehensive” pension reform plan with a far-reaching impact on Chicago, Cook County, downstate police and fire, and state pension funds. The bill includes a provision to allow local government to pursue a Chapter 9 restructuring after an independent evaluation is conducted and decision is made that a fiscal emergency exists.
"We are calling on Speaker Madigan to take up these bills, the specific bills," the freshman GOP governor said at a news conference where he renewed his push for various reform measures considered too pro-business and anti-union to win Democratic support.
Otherwise, he urged Madigan, the Chicago Democrat who has been the focus of his ire, to use the Democrats' three-fifths majority to pass a tax hike.
"Speaker Madigan needs to make a decision?.support reforms or pass a tax hike?it's one or the other," Rauner said, reiterating his willingness to discuss tax increases to offset the need for cuts in fiscal 2016. "We are at a critical point. We are now well into overtime?and do not yet have a new state budget."
Democrats and Republicans have sought to cast the blame on the other for the gridlock that stalled passage of a balanced budget for the fiscal year beginning July 1. Rauner proposed a $32 billion plan with deep cuts. Democrats pushed through a $36.3 billion plan that was as much as $4 billion short of needed revenue.
"It's fundamentally irresponsible," Rauner said Wednesday of the Democratic spending plan. The governor vetoed all of it except for the education component. He wants Democrats to pass worker's compensation and tort reforms, a temporary local government property tax freeze, and ballot measures on term limits and redistricting changes in exchange for tax hikes.
Democrats have countered that Rauner's own budget proposal was at least $2 billion out of whack because it relied on savings from pension reforms that even Rauner admits might not hold up to a legal challenge. House and Senate leaders argue that they've attempt to pass his agenda proposals and they've failed.
The House session was set to resume late Wednesday and continue through Thursday while the Senate returns next week. The House plans to take a second vote on a one-month spending plan that would allow state employees and bills to get paid. The Senate passed the measure last week, but it failed in the House.
"I will not sign that bill," Rauner said Wednesday.
Madigan spokesman Steve Brown rejected the idea of lawmakers passing a tax hike on their own. "It doesn't work that way," he said. "We are talking about a budget that is under his authority. There's going to need to be cooperative process."
Brown dismissed Rauner's comments as "more name calling" and put the blame on the governor for having the "whole state work force up in arms" over a court ruling preventing the state from meeting full payroll without a budget. Brown argues that the governor could have prevented the mess by using his amendatory veto powers to approve some spending like payroll.
Rauner said at the news conference he was reintroducing his key reform proposals to reflect changes after negotiations with lawmakers and local officials and announcing a comprehensive pension reform bill that will be introduced in the coming days.
The pension bill reflects negotiations with the city, Cook County, senate leaders and other lawmakers, Rauner said. The package could save taxpayers several billions annually. "We believe it's both fair and reasonable for government employees and taxpayers," Rauner said.
The bill includes changes lawmakers have approved that give Chicago more than $200 million in relief on a $550 million spike in its contributions for police and fire funds next year and extends by 15 years the deadline to reach a 90% funded ratio. It also includes a new payment ramp for other public safety pension funds and it includes Cook County's proposed reform package.
It borrows from Senate President John Cullerton, D-Chicago's, pension reform "consideration" model that seeks to pass constitutional muster by getting employees to accept reduced benefits in exchange for some perks.
A consideration model would apply to state plans, downstate public safety plans and the Chicago Teachers' Pension Fund. Cook County could choose between its proposal or the consideration model. The state would pick up a greater share of Chicago Public Schools' contributions for its teachers fund and employees would be required to cover a greater share of their costs now paid for by CPS.
The bill, however, has some sticking points for Democrats including a provision to allow local governments to restructure under Chapter 9, which is not currently allowed under state law.
"The governor's recognition of the Cullerton model is encouraging, but we will have to review the details of the governor's new proposal," said Cullerton spokeswoman Rikeesha Phelon.
Brown said the speaker would look at the bill to consider whether it could pass legal muster given the Illinois Supreme Court's May decision voiding 2013 pension reforms for impairing benefits.
"We have not had an opportunity to review the proposed legislation, however legislative leaders and the Governor were briefed on Chicago's agenda early in the legislative session," said Kelley Quinn, a spokeswoman for Chicago Mayor Rahm Emanuel. "While we are encouraged that the governor has incorporated elements of both the City and CPS' agenda, some of these items have already been adopted by the General Assembly, including pensions for both police and fire."
