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Volume 22, Number 33, May 13, 2016

Rauner unfairly suffers from Brownback Effect

By Jim Broadway, Publisher, Illinois School News Service

Only four other governors have approval ratings lower than Bruce Rauner has. I learned that from a web site I was directed to by my friends at Crain's Chicago Business. In a recent poll with a margin of error of 1.8%, Rauner's performance on the job met with the approval of only 34% of the poll's respondents.

My reaction is that this is unfair. I suspect Rauner is paying a price for something he did not do. Oh, sure, there's plenty that he did do. I got a call Thursday from a reader whose friends asked him why Rauner, and not House Speaker Mike Madigan, is being blamed for problems relating to the lack of a state budget.

In this case, the blame belongs to Rauner. The fact is, the legislative branch of government sent Rauner a complete set of budget bills about a year ago. Sure, they called for about $36 billion in spending against only about $32 billion in projected revenue, but the state constitution gives Rauner a rare tool to deal with that.

It's called a "line-item veto." Rauner could have cut any line item in the budget, all the way down to zero if he wanted to, to make total spending match total revenues. Instead, he signed the budget for public education (angry moms would have strung him up if schools hadn't opened on time) and just vetoed all the rest.

So outside of PK-12 education, there's been no budget enacted by the legislature and signed by Rauner for the fiscal year that ends June 30. Some items are covered whether a budget is enacted or not; bonded debt service, for example, and pension payments are funded through something called a "continuing appropriation."

Certain state services, like the State Police and Medicaid, are required to continue. Court orders have kept much of the state functioning without a budget. Some spending has just been too crucial to ignore; for example, an appropriation was made for local governments so they could buy salt for roads over the winter.

Salaries of state employees would continue without a budget, a court ruled. My understanding is that about 90% of what would have been covered by appropriations is being continued on some other basis of authority. It's an out-of-control way for the state to function, but Rauner vetoed the bills so this is the way it is.

That's surely why his approval ratings are so low. When you think about it, Rauner's in an elite club. Only 20 governors are approved of by fewer than half of their citizens, and Rauner made the top 10% of all governors when the amount of disdain they evoke is considered. Still, I believe he's paying too much for his incompetence.

Why are his miserable approval ratings unfair? In my view, there are two aspects of the reason for the contempt in which Illinois citizens hold Rauner. One aspect is the lack of a budget. Okay, he's mostly to blame for that. He had a budget in his hands. He could have shaped it as he wished, but didn't.

That's some significant culpability for the current state fiscal mess. Former governors used the line-item veto extensively. It was one of Big Jim Thompson's favorite constitutional provisions. Jim Edgar was known to trim appropriations a bit now and then. Not to use the line-item veto is, well, just not doing your job.

But there's another factor in the problem and Rauner did nothing to create it. That factor is the pitiful little revenue stream that is supposed to cover the costs of a reasonable mix of state programs and services. For years, policymakers piled on the smokers, drinkers and gamblers - until there were just no sins left to tax.

It got so bad that, in a lame-duck session in 2011 they gritted their teeth and raised the personal and corporate income tax rates. We remained one of the lowest-taxing states, but pension obligations were being met and the accumulation of bills long unpaid was beginning to dwindle down a bit.

But last year Illinois' fiscal gear shifted again to reverse. Comptroller Leslie Munger's desk was inundated with valid claims that could not be paid. What happened? The decision-maker on the 2011 tax rate increase put a sunset provision into the bill. Most of the increase is already gone. Services are going unpaid.

It's not just that the state cannot do as much as it would like to do for people who need help. It's that non-profit groups with whom responsible state officials actually signed contracts - and who are being required by those officials to provide the services contracted for - are not receiving the dollars the state promised them.

In fact, there's a whole new non-profit organization, "Pay Now Illinois," a coalition of 64 human and social service agencies, that has been owed more than $100 million, for more than 300 days, for work they performed under contracts with the state, contracts whose performance was enforced by the state.

Last week we learned that Pay Now Illinois has resorted to litigation.

The bottom line, though, as it relates to Rauner's low approval ratings, is that Rauner is culpable only for dysfunction since January of last year. Someone else made the timid decision to sunset the timid tax increase. Who was that? Since House caucuses are not Open Meeting Act-exempt, we cannot know.

But I think the (insert a Trump expletive here) culprit was Madigan.

So what is the Brownback Effect and how does it apply? Back in 2012, Kansas Gov. Sam Brownback gained national notoriety - and in-state popularity - for leading the charge for dramatic tax reductions. He was a true believer that tens of thousands of jobs would result from corporate attraction to a low-tax state.

You hear the same kind of simple blind faith from Illinois legislators, like Sen. Matt Murphy (R-Palatine) and Rep. Dwight Kay (R-Edwardsville). There's plenty of research on job-creation. State taxation has very little to do with it. Investment by the state - in education and infrastructure - has far more influence.

Anyway, Brownback was the culprit in the first instance, of making sure his state could not provide programs and services of any quality (and they weren't much to begin with), and he still insists that the Kansas government "stay the course." Since there are too few Democrats to blame, his GOP colleagues now blame him.

Will Rauner follow Brownback into oblivion, or will he and legislative leaders take reasonable action? I think the latter is likely, not because anyone has become wiser but because their range of options is shrinking. In fact, the "leaders" may just now be considering a proposal crafted by grown-ups in the legislature.

The story is developing, but initial reporting by veteran legislative reporter Doug Finke of The State Journal-Register is that a plan for tax increases generating $5.4 billion in new revenue, combined with $2.4 billion in budget cuts, is now proposed by "rank-and-file budget negotiators" for Rauner and the leaders to study.

The road back to fiscal reality is an uncertain one, an unfamiliar one in Illinois. To travel it, Rauner will need to put his union-busting ambitions aside and accept the budget process as one which aligns current spending with current revenue. Forget Wisconsin. Forget Kansas. Concentrate on Illinois.

Meanwhile, other issues also are developing. Litigation was filed to challenge efforts by the "Independent Map Coalition" which last week delivered petitions with twice as many signatures as are required to get their proposed amendment to the Illinois Constitution on the November ballot for the voters to ratify.

They propose an independent commission to draw new legislative district boundaries every ten years, instead of keeping the current system of letting the political parties gerrymander the districts. The "fair map" group wants voters to pick their legislators instead of continuing to let legislators pick their voters.

Getting on the ballot is very difficult by a citizens' petition. Now a lawyer who used to work for Madigan (whose staff says he is not involved) has challenged the group's proposal on several legal grounds. It will take a creative decision by the Supreme Court, I think, to allow the voters to consider this amendment.

The map proposal has great potential for political reform in Illinois. It is, like school funding reform, something that has been pending on the periphery of the policy agenda for many years. The coalition that has pursued it since last year is led by men and women of rare distinction. We will follow this one to the end.

What have the legislators done with regard to education and fiscal policy in the last few days? Except for the Senate's passage of SB 231, Sen. Andy Manar's school funding reform proposal, most everything else has been to move bills out of House and Senate committee before today's deadline for such action.

By mid-week, the legislative leaders seemed to believe they had make great progress; the adjournment resolution makes it clear that today's previously scheduled session day has been canceled in both chambers. They'll be back Tuesday.

You can review the legislative actions of Thursday, if you wish. Wednesday's achievements are also posted for you to see if you have time on your hands. As an alternative, you can go about your business today (I'm going to visit my Mom.) and wait until Monday for another ISNS school policy report.

Have a great weekend, friends.

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