Legislation creating a South Suburban Airport was signed into law during the week, signifying the end of a decades-long regional stalemate. The Governor also authorized a significant Medicaid expansion and signed a bill to eliminate lucrative pension benefits for future appointees to Chicago and suburban transit boards.
Economic Development Omnibus
On July 25, Governor Pat Quinn signed Senate Bill 20, a major economic development incentive package that was approved on the final day of the legislative session.
Senate Bill 20 paves the way for the South Suburban Airport near Peotone, as well as establishes a long list of incentives and authorizations for a number of other projects across Illinois. In addition to allowing the Illinois Department of Transportation to create a public-private partnership to build the new airport, other notable projects include the construction of a new arena for DePaul University near Chicago’s McCormick Place, improvements at the Rosemont Convention Center, and development of a Cronus Fertilizer Plant near Tuscola.
While many of the projects were laudable, generating jobs and revenue in virtually all regions of the state, a number of us took issue with the haste with which the bill was pushed through the General Assembly. Additionally, we believe that there are aspects of the bill that could make it more difficult for small businesses to participate in state projects. The 17 Senators who voted against Senate Bill 20 noted that legislation of this magnitude requires more oversight and consideration, and should not have been rushed through the legislative process in the final hours of the spring session. Additionally, we pointed out these large projects should be considered individually, rather than lumped together in one massive package.
Medicaid Expansion Signed By Governor
Earlier in the week, Governor Quinn signed legislation that voluntarily expands the state’s Medicaid program to nearly 350,000 additional persons.
Senate Bill 26 will make adults who are under 138% of the Federal Poverty Level eligible for Medicaid beginning Jan. 1, 2014. This expansion comes in addition to the 250,000 previously added to the rolls as a result of a Cook County waiver to allow early implementation of the federal Affordable Care Act (commonly known as Obamacare).
The Medicaid expansion, which was made optional thanks to a U.S. Supreme Court Decision last year, underlined key differences between the two parties in the General Assembly. In signing the Medicaid measure, the Governor and his allies pointed with pride to the swelling Medicaid rolls as an example of the state’s commitment to expanded health care for the poor.
We Republicans worry that the state is embarking on a costly new expansion that will be difficult to maintain in future years. We reminded our colleagues that even as Washington waves dollar bills in front of their eyes, the program is neither free nor affordable in a state that teeters on the edge of bankruptcy. Unfortunately, many of my colleagues just don’t get it. Perhaps an economics course should be required for all state legislators?
Medicaid costs are the fastest growing expense in the state budget. The system is already growing by more than 130,000 persons annually and now accounts for half of all births in the state. The estimated cumulative cost of the expansion by 2020 could exceed $2.9 billion, including about $575 million in direct costs and another $2.3 billion in indirect costs, because as many as 168,000 previously eligible persons are expected to enroll and the state must pay 50% of the cost for those individuals.
We opponents also expressed concerns that, while the state could legally scale back benefits if the federal government reduces its contribution in the future, in practice it is almost impossible to reduce benefits once they have been granted.
New Law Targets Transit Board Pensions
A good bill (yes, there were a few) signed into law during the week prohibits future members of the Regional Transportation Authority (RTA) Board, Suburban Bus Board (Pace), Commuter Rail Board (Metra) and Chicago Transit Authority (CTA) Board from receiving pension benefits or health insurance benefits.
House Bill 140 eliminates the generous health care and pension benefits given to the appointees who oversee Chicago area mass transit operations. Those currently in office will still keep their benefit; however, if a current officeholder accepts a reappointment, they will lose the benefits they had accrued.
The state’s well-known pension problems, coupled with the recent scandals at Metra and other transit agencies, prompted lawmakers to reevaluate the lucrative pension benefits given to the part-time appointees. Most recently, media reports surfaced with allegations that former Metra CEO Alex Clifford collected a $718,000 severance package after being forced from the organization for refusing to cooperate with political patronage requests.
I asked to serve on the new House/Senate pension committee, believing that my lifetime experience in the financial area provided me with a strong background to help solve this mess, but I was told I am too independent and too likely to “freelance.” I guess that means that I just might suggest a creative idea that was not preapproved by leadership?