Rauner proposes Illinois pension overhaul, transit and Medicaid cuts
SPRINGFIELD, Ill. (WLS) -- Gov. Bruce Rauner unveiled a proposal Wednesday to overhaul Illinois' pension system, also including cuts to local governments, higher education and public transit.
"The budget outlined today is the budget Illinois can afford," Rauner said.
Read the full budget proposal here.
The 23-minute speech had no specifics; they would come later and included a list of spending cuts and cost savings to resolve a projected $6.7 billion deficit.
"We have been living beyond our means, spending money that Illinois taxpayers cannot afford," Rauner said.
The proposed cuts include $1.5 billion from Medicaid, plus hundreds of millions from state worker health insurance, aid to local governments and higher education. The plan would also cut deep into state aid to mass transit.
"We needed someone to give us the straight story," said Rep. Ron Sandack, a Republican representing Downers Grove.
"Rauner basically said to families across Illinois, 'I'm not going to reach into your wallet and take any more of your money,'" said Christine Rasmussen, Illinois Policy Institute.
The governor also told the lawmakers his plan to junk the state pension system and replace it with a 401k-style system that he says could save $2.2 billion in the next fiscal year.
"What he just laid out is clearly illegal and it doesn't solve the state's problems at all," said Dan Montgomery, Illinois Federation of Teachers.
"I'd be interested in finding out more of the details but, at minimum, it sounded constitutional," said State Sen. Kwame Raoul.
Rauner's spending plan would have to be approved by the Democratic-controlled House and Senate. Speaker Michael Madigan sounded skeptical of the Republican governor's "cuts-only" approach to budgeting, and said a tax on millionaires should be part of the strategy to resolve the deficit.
"I think the elimination of deficits will require a blend of service cuts and new revenue," Madigan said.
The Rauner budget includes additional revenue for K-12 education, and cuts to higher education would not include community colleges of the MAP aid program. But lawmakers fear that the cuts will have a trickle-down effect for social programs on a local level.
Opponents blast Rauner budget cuts
The budget cuts proposed by Gov. Bruce Rauner Wedensday are deep and painful, as many presumed they would be. But his opponents consider the governor's ideas out of order, an unfair burden on those who can least afford it.
A key part of the governor's budget would have state employees and teachers enroll in a lower benefit pension plan July 1. What they've already earned would be frozen and they could opt to convert to a 401k savings plan.
"The pension reform plan protects every dollar of benefits earned. What you've earned, you're going to get. And if you are retired, you get everything you were promised. That's fair and it's right," Rauner said. "But moving forward, all future work will be under the Tier 2 pension plan, except for our police and firefighters."
Public safety employees would remain under the old pension plan. Teachers and leaders of the Democratically-controlled General Assembly say Rauner's plan is a non-starter and would not stand constitutional muster.
Rauner would put more money into the general education fund, but he would cut higher education by $387 million; that's nearly a third and would mean an end to many college tuition assistance grants.
Medicaid would be cut by a billion and a half dollars, which would which would dramatically impact medical care and prescription drug availability for lower income residents.
"Initially look at safety net hospitals, funding to the most vulnerable - those who won't have access to health care, people reliant on this program to take care of their very needs," said Kristen Crowell, executive director of United Working Families.
Mass transit would take a hit of over $100 million. Public health would lose programs. The state's prisons - which Rauner has called overcrowded and unsafe, much to the chagrin of prison officials - will get help with the hiring of nearly 500 new correctional officers to alleviate stress and expense of over $100 million in overtime the last two years.
"We think that's a start to address the issues and concerns of the safety aspect of the Department of Corrections," said Ralph Portwood, president of AFSCME Local 1866.
Rauner also proposes cutting the state's revenue sharing with cities by half. For Chicago, that would mean a further hole in the budget of $150 million - no small chunk of change. The governor is sticking to the plan of not bringing back the income tax hike.
State-funded programs left reeling by proposed cuts
Elizabeth Hailey-Smith, whose daughter is developmentally-disabled, has a message for Gov. Rauner.
"Think about what if this was your child, what if this was your sister who you decided you wanted to cut funding from?" said Hailey-Smith.
Hailey-Smith says state-funded programs that are now on the chopping block have helped 40-year-old Tamara get care and learn life skills.
"The funding that the state is currently providing for her is giving her the opportunity to stay in the community, stay in her home, learn to be independent as much as she possibly can," Hailey-Smith said.
One group left reeling by the governor's budget is the Illinois Coalition for Immigrant and Refugee rights, which helps thousands every year become U.S. citizens.
The governor last month pledged his support.
"I'm dedicated to you. I want to be a great partner and an ally for each of you," Rauner said last month, but on Wednesday, he erased the group's funding.
"Not to even be mentioned, not to even have a line in the budget, was shocking," said Lawrence Benito, Illinois Coalition For Immigrant & Refugee Rights.
A coalition of community groups and social service providers are planning a downtown rally Thursday and march to the Thompson Center. It's the start of what could be weeks of protests over the budget.
UIC students concerned about education funding cuts
While many UIC students are concerned about keeping up with their studies, some are now worried about being able to afford to stay in school.
Joe Epperson, 30, is a non-traditional student with a three-year-old son who is able to go to school thanks to grant money. He's worried about potential cuts to those programs.
"We've relied immensely on some of that help, and if that were to go away, I really don't know what we would do," Epperson said.
It's still unclear what effect the proposed cuts would have on student financial aid, if any. But it's a topic of discussion among students who typically might pay little attention to a state budget address.
"I believe that students would be less likely to pursue certain goals if there is a huge cut in student aid," said Enyioma Alilionwo, a UIC student.
"I don't think that's a good idea because I feel like investing in education is one of the most important investments we can make," said David Ingo, a UIC student.
The proposed cuts would likely have a big impact on university budgets as well. Nearly $400 million would be cut statewide.
"I have another three years here, I'd like to think that when I get to be a senior, the same opportunities that are available now will be available in the future," said Jennifer Novak, a UIC student.
