|
Dear Neighbor,
At our halfway point in the legislative session, we have progress, although no final results, on our most pressing issues. Below I provide an update on pensions, Medicaid and the overall budget.
Pensions
The Governor's working group which includes a representative from each of the four caucuses is charged with providing proposed solutions by April 17th. Senate President Cullerton recently laid out his vision for pension reform at a City Club of Chicago lunch. Key elements of his proposal include:
- Changing cost of living adjustments (COLAs) from compounding to simple in exchange for concessions from the state, such as a new guaranty that the State will always make its required contribution payment; and
- Gradually requiring suburban and downstate school districts to pay more for pensions, as the Chicago Public School system already does.
The Senate President believes pension change can be
accomplished in a constitutional fashion, which has been of concern given Illinois' constitutional provision that states:
"Membership in any pension or retirement system of the state, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefit of which shall not be diminished or impaired."
As an optimist, I remain hopeful that we will have the opportunity to vote on significant pension reform this session. Recently I had the opportunity to hear Gina Raimondo, Democratic Treasurer for the State of Rhode Island, speak on how Rhode Island enacted significant changes to their pension systems to ensure retirement security in a self-correcting fashion. Rhode Island's pensions systems were possibly in worse shape than Illinois' systems, yet she accomplished what everyone told her was impossible within a year of being elected.
Medicaid
In his budget address the Governor called on the General Assembly to reduce Illinois' Medicaid budget by $2.7 billion, a dramatic cut to the state's $14 billion Medicaid program. The full Senate heard a presentation from the National Conference of State Legislatures' leading expert on Medicaid about national Medicaid reform efforts and the Democratic caucus heard a presentation from Illinois' Medicaid Director to understand the problem and options for what can be done in Illinois.
A working group of the Governor's Office and 4 caucuses, including myself as the Senate Democratic representative, is meeting frequently to develop a proposal to achieve a $2.7 billion Medicaid solution. Last week we had most of the Medicaid provider groups present us with options to reduce our Medicaid costs, which will inform our recommendations. Like the pensions group, we will have a proposal in April.
I believe that a $2.7 billion solution to Medicaid this session is critical to achieving a balanced State budget. If we do not accomplish this goal, we will only exacerbate the State's fiscal challenges and make it more difficult to rein in Medicaid costs in the future.
State Budget
Two key elements to restoring fiscal integrity in Illinois are pension and Medicaid reform. While we are beginning to negotiate a budget in the Senate, we need results on these issues in order to construct a realistic, balanced budget.
Senate Republicans and Democrats are negotiating together this year with the goal of a final budget that has bipartisan support, a change from recent years. Unlike the House, we will negotiate across all parts of the budget. The House allocates available resources across 5 appropriations committees based on past spending, which prevents dollars from moving across priority areas. This year the House allocation has about a 5.3% reduction for each spending area (Elementary/Secondary Education, Higher Education, Human Services, Public Safety, and General Services).
As one of the Senate Appropriations chairs, I am pleased with the tone of our budget negotiations to date. We are close to a general agreement on an approach, and will shortly turn to delving into each agency's line items to determine our recommended approach to achieving a balanced budget. We plan to work with the Governor's Office and seek agency input during our process as well, which I am convinced will lead to a better budget result.
I will provide regular updates on these and other significant issues as we move through session. If you have any questions or comments please contact me at hsteans@senatedem.ilga.gov or at 773-769-1717.
Best,
Heather A. Steans
State Senator - 7th District
| 
