Illinois General Assembly

Chicago Board Of Education Could Borrow More Than $1 Billion With $600 Million-Plus Pension Payment Due Next Week

I fear Chicago’s celebratory mood post-Stanley Cup could be fast disappearing as the city’s financial reckoning day rapidly approaches. Juan Perez, Jr., reported on the Chicago Tribune website tonight:

The Chicago Board of Education on Wednesday approved plans to borrow more than $1 billion in an effort to manage an immediate cash crunch and get through the coming budget year.

The borrowing is on top of an existing line of credit of up to $500 million. The initial $200 million in borrowing authorized Wednesday could help the district cover its bills through the end of June, but the district would be short of cash to cover payments shortly after that, according to documents obtained by the Tribune.

A separate line of credit of up to $935 million would take the district through the coming budget year. The loans will be secured with the promise of future property tax revenue.

The board’s unanimous 5-0 vote in favor additional borrowing came one day after the Illinois House fell 18 votes short of approving a three-week extension on a $600 million-plus pension payment due next week

(Editor’s note: Bold added for emphasis)

Democrats have a supermajority in both chambers of the Illinois General Assembly, and “Machine”-controlled Chicago still couldn’t get that pension payment deadline extended.

Oh well. Long-time Survival And Prosperity readers shouldn’t be the least bit surprised about the latest bad news concerning Chicago’s public schools. I blogged way back on September 13, 2012:

By now, many of you have probably heard about the teachers strike going on in Chicago. Day 4 and counting. While many Chicago public school teachers are probably worth every red cent of the $71,017 median salary they command- and more- when all things are considered, considering the precarious financial situation of the Chicago Public Schools, a larger crisis looks to be right around the corner.

Looks like we’re almost there.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Perez, Juan. “Chicago school board approves more than $1 billion in new borrowing.” Chicago Tribune. 24 June 2015. (http://www.chicagotribune.com/news/local/breaking/ct-school-board-meets-met-0625-20150624-story.html). 24 June 2015.

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Illinois Tax Hikes Coming Warn Municipal Bond Fund Managers

Talk of rapidly-approaching tax hikes in the “Land of Lincoln” is growing. Reuters’ Nick Brown, Megan Davies, and Karen Pierog reported yesterday:

With no easy way to financially engineer or negotiate its way out of a budget and pensions crisis, Illinois is likely to dish out some unpleasant medicine to its residents in the next few years. And investors say that is most likely to come in the form of higher taxes.

Given the Democrats’ control of the state legislature and their opposition to many proposals for spending cuts, municipal bond fund managers see little alternative for Republican Governor Bruce Rauner other than eventually agreeing to hike taxes, such as raising the state’s income tax or broadening its sales tax base…

(Editor’s note: Bold added for emphasis)

Regular readers of Survival And Prosperity shouldn’t be surprised when the hikes (fees, fines, and taxes) arrive, as they’ve been discussed on this blog for quite some time now. The tragedy is that Springfield continues to waste time and resources on trivial matters while neglecting to tackle crucial issues like the well-publicized debt crisis. Monique Garcia and Kim Geiger reported on the latest nonsense preoccupying the politicians. From the Chicago Tribune website this afternoon:

Democratic Speaker Michael Madigan’s effort to ask voters to approve a measure to impose higher income taxes on millionaires failed in the House on Thursday, but provides the powerful Southwest Side politician ammunition to attack Republicans in next year’s legislative campaigns.

The proposal needed 71 “yes” votes to pass, but received just 68. But now there’s a roll call, and Madigan’s Illinois Democratic Party could send out mailers criticizing Republicans who voted against the idea. Democrats already have sent out attack ads against Republicans who did not vote in favor of a property tax freeze last week

(Editor’s note: Bold added for emphasis)

Games. Stupid political games as the state’s “financial reckoning day” fast approaches.

By the way, back on March 24 of last year I blogged about that push for a “millionaire’s tax” in Illinois. My prediction now is pretty much the same as it was a year ago:

Should Illinois Democrats jack up their income taxes, I suspect the number of Illinois millionaires right before the tax hike is implemented will plummet. Revenue will follow. Out-of-state vacation homes in Indiana and Wisconsin will be declared as primary residences.

The only difference being, I forgot to mention Michigan vacation homes.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Brown, Nick, Davies, Megan and Pierog. “As Illinois runs out of options in budget crisis, tax rises seen in the cards.” Reuters. 20 May 2015. (http://news.yahoo.com/illinois-runs-options-budget-crisis-tax-rises-seen-051616644.html). 21 May 2015.

Garcia, Monique and Geiger, Kim. “Madigan’s ‘millionaire tax’ question fails in House.” Chicago Tribune. 21 May 2015. (http://www.chicagotribune.com/news/local/politics/ct-rauner-warns-of-long-overtime-20150521-story.html). 21 May 2015.

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Signs Of The Time, Part 85

Monday at lunch I finally got the chance to read my Sunday paper. From the Chicago Tribune “Perspective” section, in the part entitled, “Voice Of The People”:

Do not allow silencers

I cannot believe that there is serious consideration to permitting gun silencers to be used by gun owners in Illinois. Anyone with an ounce of common sense will recognize that guns with silencers are the weapon of choice for assassins, terrorists and murderers. What would happen if a nut entered a school and starting shooting randomly with such a weapon? No noise to alert the rest of the teachers and children?

Two things came to mind when I saw the above:

1. The author has quite an imagination.

2. Yet another argument leaning heavily on emotion (plea for “common sense” is often a giveaway), but devoid of facts.

Emotionally-driven arguments. Very much a sign of the time.

But now the facts on this subject.

An ABC7 Chicago I-Team Investigation recently looked into suppressors as legislation legalizing such devices has been introduced in the Illinois House (HB0433) and Senate (SB0803). Chuck Goudie reported on the ABC7 website on April 30:

Silencers used by criminals on TV and in movies; this is how most people know of the device.

Sponsors of a bill to make them legal in Illinois say the Hollywood interpretation is pure fiction…

A 2007 study found silencer use in crime is rare…

(Editor’s note: Bold added for emphasis)

“Guns with silencers are the weapon of choice for assassins, terrorists and murderers.”

Whatever you say.

And all those “assassins, terrorists and murderers” will be lining up for silencers if they’re legalized in Illinois, right?

As I blogged back on February 11:

Firearm suppressors (or sound suppressors and silencers as they’re also known) are highly-regulated in the United States. J. Guthrie reported on the Guns & Ammo website back on May 13, 2012:

If you lived in Scotland, they would be required for hunting. If you lived in Finland you could saunter down to the local gun shop and buy one over the counter—one more reason to like Finland. In the U.S., suppressors are regulated by the National Firearms Act and you have to first make sure they are legal in your state, fill out a federal form and send it, a couple of photos and some fingerprints into the BATFE for approval. Once approved—the process can take six or seven months—the BATFE sends you a little stamp and some paperwork and you can take possession of the suppressor from you dealer. There are legal considerations for interstate transportation and transferring the suppressor too…

Just like most felons don’t acquire their firearms lawfully, neither will they be obtaining suppressors legally- particularly in a highly-regulated environment like the one that currently exists.

Fears of a proliferation of legally-manufactured, lawfully-obtained suppressors among the bad guys in the “Land of Lincoln” are unfounded.

As for the “Voice Of The People” on these devices? I sure as hell hope it isn’t.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Goudie, Chuck. “Are Gun Silencers A Threat To Safety?” ABC 7. 30 Apr. 2015. (http://abc7chicago.com/news/are-gun-silencers-a-threat-to-safety/689952/). 18 May 2015.

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Cook County Public Pension Fix Could Mean Property Tax Hike

Blog readers in Cook County, Illinois, should prepare themselves for the possibility of higher property taxes shortly. Hal Dardick and Monique Garcia reported on the Chicago Tribune website Friday:

Cook County Board President Toni Preckwinkle is trying to revive a plan to overhaul government worker pensions, with supporters arguing the proposal is vastly different from changes to state retirement benefits recently struck down by the Illinois Supreme Court.

The proposal would cut benefits and raise retirement ages but also guarantee health care benefits for workers when they retire. It calls for the county to put almost $147 million more a year into the pension fund, though Preckwinkle continues to be vague about how she’ll fund that increase by repeatedly saying “all options are on the table.”

If the County Board chooses to foot the bill with a property tax increase, the average homeowner would pay up to $65 more a year starting in 2017, according to one internal county document the Tribune obtained when Preckwinkle sought the same legislation last year.

That measure was approved by the Senate last year but stalled in the House. It is now scheduled to be heard by a panel of House lawmakers next week…

(Editor’s note: Bold added for emphasis)

Readers shouldn’t be surprised about the prospect of higher property taxes. I blogged back on January 13:

Cook County Board President Toni Preckwinkle also gave a speech yesterday in which she hinted at county residents having to make future sacrifices. John Byrne reported on the Chicago Tribune website Monday:

Preckwinkle gave a speech to the City Club of Chicago about her first-term achievements and laid out a blueprint for her second four years in office. Asked afterward about the likelihood she will be forced to raise taxes, Preckwinkle said only that it will be “a challenge” to meet the county’s financial obligations.

“We have significant challenges, both around the spike in our debt obligations and our pension obligations, and my charge to our chief financial officer is that he has to do everything he can to be creative in figuring out how to address these problems,” she said…

Preckwinkle crafted a $4 billion budget for 2015 that includes no new taxes, fines or fees. She has warned that the 2016 budget will be far trickier to balance because debt payments will increase and the county could need to come up with $144 million more to pay into the county workers retirement system if she gets the pension fund changes she has asked for from the General Assembly.

“I can’t predict now, because we don’t even have a pension bill, how much it’s going to cost or what it’s going to take, but it’s going to be a real challenge, I’ll say that,” she said Monday.

(Editor’s note: Bold added for emphasis)

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Dardick, Hal and Garcia, Monique. “Preckwinkle tries again on Cook County pension changes.” Chicago Tribune. 15 May 2015. (http://www.chicagotribune.com/news/local/politics/ct-cook-county-pension-proposal-met-20150515-story.html). 17 May 2015.

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Standard & Poor’s Warns Chicago ‘Downgrade Of More Than One Notch Is Possible’

Not too much talk about the following last week in the Chicago-area news. From Standard & Poor’s credit analyst Helen Samuelson over on S&P’s Global Credit Portal website on April 9:

CHICAGO (Standard & Poor’s) April 9, 2015–After months of campaigning and uncertainty, Chicago (A+/Negative general obligation debt rating) can get back to the business of running itself. As such, we expect Mayor Rahm Emanuel’s attention to be focused on the city’s budget challenges, namely its ballooning pension obligation.

During the course of the election — and particularly during the runoff — Mayor Emanuel avoided addressing the possibility of property tax increases to help pay for these pension obligations.

“Following Tuesday’s vote, in order to maintain its current rating, we expect the administration to address the pension and budget challenges head on by providing solutions that will support the city’s credit strengths in the near and far term,” said Standard & Poor’s credit analyst Helen Samuelson.

Our ‘A+’ rating is predicated on Chicago’s ability to make the changes necessary to address its budget gap and pension problem. However, even with this ability, to ensure long-term stability Chicago still needs to demonstrate its willingness to make difficult choices that address its budget issues.

Otherwise, the ‘A+’ rating could be severely pressured. Our negative rating outlook reflects the city’s fiscal pressures. If the city doesn’t find structural solutions, a downgrade of more than one notch is possible.

In our view, if the city fails to articulate and implement a plan by the end of 2015 to sustainably fund its pension contributions, or if it substantially draws down its reserves to fund the contributions, we will likely lower the rating. This is regardless of whatever relief the state legislature may or may not provide. We will likely affirm the rating and revise the outlook to stable if Chicago is able to successfully absorb its higher pension costs while maintaining balanced budgetary performance and reserves at or near their current level…

(Editor’s note: Bold added for emphasis)

To date, a different credit rating agency- Moody’s- has been making the most noise about the City of Chicago’s financial woes. Yvette Shields reported on The Bond Buyer website on April 6:

The city has suffered a steep credit rating slide and further credit deterioration is threatened.

Chicago’s GO ratings range from a low of Baa2 — two notches above speculative grade — from Moody’s to a high of A-plus from Standard & Poor’s…

“A-plus.” That may not be the case at year end.

You can read that entire Standard & Poor’s piece on the Global Credit Portal here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Shields, Yvette. “Big Stakes as Market Awaits Chicago’s Mayoral Pick.” The Bond Buyer. 6 Apr. 2015. (http://www.bondbuyer.com/news/regionalnews/big-stakes-as-market-awaits-chicagos-mayoral-pick-1071986-1.html). 16 Apr. 2015.

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Thursday, April 16th, 2015 Credit, Debt Crisis, Entitlements, Government, Taxes No Comments

Bill Introduced To Permit Illinois Municipalities To File For Bankruptcy

Since I started blogging about a U.S. financial crash back on Memorial Day Weekend 2007, I’ve believed one casualty will be municipal government. Particularly in Illinois. So imagine my non-surprise when I spotted an article on the Chicago Tribune website a couple of days ago about proposed legislation at the state level granting Illinois towns the authority to file for bankruptcy. Nick Swedberg of the Associated Press wrote on March 26:

Stressed by pension debt, other financial issues and the possibility losing a chunk of their state aid, some Illinois cities want the option to file for bankruptcy. They’ve found an ally in a Republican lawmaker, who’s proposed legislation to allow municipalities to follow in the footsteps of Detroit and other cities in restructuring debt and paying back creditors…

Rep. Ron Sandack is sponsoring legislation that would grant authority for communities to file for bankruptcy under Chapter 9 of the federal code. The Downers Grove Republican says it’s a “measure of last resort,” especially with Gov. Bruce Rauner’s proposal in next year’s budget to cut in half the local governments’ share of state income taxes by 50 percent.

“It’s just giving time and space to do things right,” he said…

Swedberg added later in the piece:

Municipal bankruptcies are rare, NCSL data shows. Of 37 local government filings since 2010, only 8 were cities, with the majority filed by utilities and special districts.

Detroit filed for the nation’s largest municipal bankruptcy in July 2013, looking to restructure $12 billion of debt…

It’s true. Municipal bankruptcies haven’t happened too often. But keep in mind what Eric Weiner wrote on the NPR website back on February 28, 2008:

For most of U.S. history, cities and towns were not eligible for bankruptcy protection. But during the Great Depression, more than 2,000 municipalities defaulted on their debt, and they pleaded with President Roosevelt for a federal bailout. “All they got was sympathy,” reported Time magazine in 1933. Instead, Roosevelt pushed through changes to the bankruptcy laws that allows towns and cities to file for bankruptcy. They even got their own section of the bankruptcy code: Chapter Nine…

(Editor’s note: Bold added for emphasis)

There’s also this from Robert Slavin on The Bond Buyer website back on January 14:

For the municipal bond industry, 2015 marks the midpoint in what may turn out to be the decade of the bankruptcy.

Four of the five largest municipal bankruptcy filings in United States history have been made in roughly the last three years, a trend analysts attribute to the aftereffects of the 2008 credit crisis and Great Recession, as well as changing attitudes about debt.

“The crash of 2008 and five years of stagnation preceded by years of escalating wages, pensions and Other Post-Employment Benefits set the stage for our recent Chapter 9 filings,” said Arent Fox partner David Dubrow.

Chapter 9 municipal bankruptcy was adopted in 1937 but had been rarely used, particularly by large governments. However, since November 2011 San Bernardino, Calif., Stockton, Calif., Jefferson County, Ala., and Detroit have filed four of the five largest bankruptcies as measured by total obligations.

(Editor’s note: Bold added for emphasis)

Could the specter of Meredith Whitney, the “Diva Of Doom,” be returning to take revenge on the municipal bond industry?

I’m not surprised Illinois municipalities would be interested in House Bill 298. From Patrick Rehkamp and Andrew Schroedter on the website of the Chicago-based Better Government Association back on December 6, 2014:

Reasons for filing vary but often include troubled public development projects, unanticipated hefty legal judgments against a taxpayer-backed entity, or massive pension and bond debt payments that leave a municipality cash-strapped and unable to cover operating costs of employee salaries, vendor payments and other expenses.

(Editor’s note: Bold added for emphasis)

The public pension crisis in Chicago and Illinois has been well-publicized for some time now. And while such entitlements are supposedly protected by a provision in the 1970 Illinois Constitution, the BGA noted in their piece:

In Illinois, public employee pensions are guaranteed by the state constitution. But in the Detroit and Stockton, California bankruptcy cases, federal judges have ruled that pension benefits can be adjusted, the same as other debts, despite a constitutional guarantee.

(Editor’s note: Bold added for emphasis)

You can track the progress of HB 298 on the Illinois General Assembly website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Swedberg, Nick. “Bill pushes for possible municipal bankruptcies in Illinois.” Associated Press. 29 Mar. 2015. (http://www.chicagotribune.com/news/sns-bc-il–closer-look-bankruptcy-20150329-story.html). 3 Apr. 2015.

Weiner, Eric. “What Happens When City Hall Goes Bankrupt?” NPR. 28 Feb. 2008. (http://www.npr.org/templates/story/story.php?storyId=60740288). 3 Apr. 2015.

Slavin, Robert. “Why So Many Big Bankruptcies?” The Bond Buyer. 14 Jan. 2015. (http://www.bondbuyer.com/news/markets-buy-side/why-so-many-big-bankruptcies-1069539-1.html). 3 Apr. 2015.

Rehkamp, Patrick and Schroedter, Andrew. “Next Up: Illinois Municipal Bankruptcy?” Better Government Association. 16 Dec. 2014. (http://www.bettergov.org/next_up_illinois_municipal_bankruptcy/). 4 Apr. 2015.

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Illinois In Worst Shape Of 43 States That Filed FY 2014 Audits

William G. Holland, the Auditor General for the State of Illinois, has just reported on Illinois’ finances.

It’s still fugly.

From the Summary Report Digest for “Statewide Financial Statement Audit For the Year Ended June 30, 2014”:

The Illinois Office of the State Comptroller prepares the State of Illinois Comprehensive Annual Financial Report (CAFR). The CAFR is the State’s official annual report which provides the readers with the financial position of the State as of June 30, 2014, and results of operations during the fiscal year.

The financial section of the CAFR includes the Independent Auditors’ Report on the basic financial statements, the management discussion and analysis, the basic financial statements, required supplementary information, and individual fund statements and schedules…

The June 30, 2014 financial statements of the State of Illinois are fairly presented in all material respects.

The financial statements at June 30, 2014 reflect the following:

The net position of governmental activities continued to deteriorate and the deficit increased by $1.3 billion from FY13 to FY14. Overall, the net position of governmental activities is reported as a deficit of $49.2 billion. (Exhibit 1)
• The General Fund deficit decreased by $658 million from FY13 to FY14. The June 30, 2014 deficit was $6.7 billion. (Exhibit 2)

Over time, increases and decreases in net position measure whether the State’s financial position is improving or deteriorating. A comparison of Illinois’ financial position to other states is contained in Exhibit 3…

(Editor’s note: Bold added for emphasis)

And the results of that “comparison of Illinois’ financial position to other states”?

Karen Pierog of Reuters reported Wednesday:

This left Illinois in the worst shape of the 43 U.S. states that had filed fiscal 2014 audits. The only other state with negative assets was Massachusetts at $29 billion. Texas reported the biggest positive net assets at $119.4 billion

(Editor’s note: Bold added for emphasis)

Good ol’ Texas. Probably get even more sneers from local folks at my University of Texas t-shirt I picked up while at that Food Insurance-sponsored prepper conference in Dallas the other year.

Pierog added something else of note:

The state marked its thirteenth consecutive year with a general fund deficit

(Editor’s note: Bold added for emphasis)

For most of those years, Democrats have dominated state government, occupying the governor’s office and the majority of both houses in the Illinois General Assembly.

Coincidence?

I’ll keep typing it on this blog until my fingers fall off:

“Financial reckoning day” is eventually coming to the “Land of Lincoln.”

As such, it might be wise for Illinoisans to start preparing if they haven’t done so already.

It won’t be the end of the world, but for many it could feel like it. Therefore, it’s probably a good idea to start addressing various vulnerabilities for such an occasion- financial and otherwise.

You can read that Summary Report Digest (.pdf format) on the Illinois Auditor General’s web page here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

Source:

Pierog, Karen. “Illinois finances continued downward slide in FY 2014: auditor.” Reuters. 18 Mar. 2015. (http://www.reuters.com/article/2015/03/18/us-usa-illinois-audit-idUSKBN0ME2M920150318). 20 Mar. 2015.

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Illinois Gun Owners Descend On State Capital To Lobby Lawmakers

Yesterday was Illinois Gun Owner Lobby Day (IGOLD) down in Springfield. Nick Swedberg of the Associated Press reported last night:

Gun owners from across the state flooded the Illinois Capitol on Wednesday for an annual rally, and many spoke with lawmakers from their home districts about legislation to broaden gun rights…

I’ve blogged about this annual gun rights event before. From the Illinois State Rifle Association website:

Illinois Gun Owner Lobby Day (IGOLD) was started back in the early ‘90’s to put a face on Illinois gun owners. Up until that time the media had portrayed gun owners and those who believed in the Second Amendment as some knuckle dragging Neanderthal throw backs, barely worthy of being called humans. IGOLD helped change that although the mainstream media still labels gun owners that way, when they can get away with it.

The first ISRA Lobby Day was attended by about 200 people. Among those attending were four undercover policemen. In 2006, the ISRA joined with several other groups and ISRA Lobby Day became Illinois Gun Owner Lobby Day (IGOLD). The Illinois Gun Owners’ Lobby Day (IGOLD) has become the number one demonstration of citizens promoting gun owners’ rights in the United States – the Illinois State Rifle Association (ISRA) is its primary sponsor. The crowds have grown each year. In 2013, 8200 gun owners showed up to lobby their legislators and to become the face of all the gun owners in Illinois. Because of IGOLD and other ISRA activities, gun owners have increased in stature in Illinois…

I understand that this year IGOLD pushed for expanding gun rights in the state- particularly concealed-carry. Swedberg added:

Proposed legislation in the General Assembly would allow concealed carry in places prohibited under current law, such as bus stations, churches and bars…

The state’s top gun rights advocacy group is expected to meet with [Illinois Governor Bruce] Rauner this month, a meeting that previous Democratic governors only promised to have. The organization’s executive director said that’s a positive sign that the new administration will be more favorable to their cause than the last.

“It’s hard to deal with people who just shut you out,” Richard Pearson, head of the Illinois State Rifle Association, said.

Illinois gun owners should be grateful for ISRA and IGOLD. Because when the next mass shooting along the lines of Newtown comes along, their keeping the spotlight on gun rights will remind politicians across the “Land of Lincoln” they’ll have a battle on their hands attempting to implement knee-jerk ineffective and unconstitutional gun “control” laws.

For more information about the Illinois State Rifle Association, visit their website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Swedberg, Nick. “Gun owners rally for right to carry guns in more places.” Associated Press. 18 Mar. 2015. (http://www.chicagotribune.com/suburbs/daily-southtown/news/ct-sta-gun-rights-st-0319-20150318-story.html). 19 Mar. 2015.

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Illinois Democrat Introduces Statewide Gun Registration, Ammo ‘Control’ Bill

“A list, record, or registry of legally owned firearms or law-abiding firearm owners is not a law enforcement tool and can become an instrument for profiling, harassing, or abusing law-abiding citizens based on their choice to own a firearm and exercise their Second Amendment right to keep and bear arms as guaranteed under the United States Constitution. Further, such a list, record, or registry has the potential to fall into the wrong hands and become a shopping list for thieves.”

-State of Florida Statutes, 790.335 Prohibition of registration of firearms; electronic records

The push for more gun “control” is on the march in the “Land of Lincoln.”

Last year around this time, State Representative Kelly Cassidy (D-Chicago) spearheaded statewide gun registration and ammunition “control” in Illinois with HB4715. Creating the “Firearms Registration Act,” the legislation eventually went nowhere.

This time around, State Senator Jacqueline Y. Collins (D-Chicago) is the torch-bearer of more gun and ammo “control” in the Midwestern state, filing the resurrected Firearms Registration Act legislation in the Senate (SB1413) on February 20. From a synopsis of the bill over on the Illinois General Assembly website:

Creates the Firearms Registration Act. Provides that every person in the State must register each firearm he or she owns or possesses in accordance with the Act. Provides that a person shall not purchase or possess ammunition within this State without having first obtained a registration certificate identifying a firearm that is suitable for use with that ammunition, or a receipt demonstrating that the person has applied to register a suitable firearm under the Act and that the application is pending. Provides that the Department of State Police must complete a background check of any person who applies for: (1) a registration certificate for a firearm that was lawfully owned or possessed on the effective date of the Act, was brought into the State by a new resident, or was acquired by operation of law upon the death of the former owner; or (2) a renewal of a registration certificate unless, within 12 months of the date the renewal application is submitted, the applicant passed a background check conducted by the Department in connection with the applicant’s acquisition of another firearm. Provides exceptions. Amends the Criminal Code of 2012. Provides that it is a Class 2 felony to sell or transfer ownership of a firearm to another person without complying with the registration requirement of the Firearms Registration Act.

(Editor’s note: Bold added for emphasis)

Before Illinois gun owners dismiss the chances of such legislation becoming law in the state, it should be noted that:

• 2014 was as an election year for state senators and representatives
• Illinois Democrats maintain a veto-proof supermajority in both chambers of the Illinois General Assembly in 2015- 71 Democrats to 46 Republicans in the House and 39 Democrats to 20 Republicans in the Senate
• A future mass shooting along the lines of Newtown or some other mass casualty event on American soil “featuring” firearms could be all it takes for the public to get behind the Firearms Registration Act

For more information about Illinois Senate Bill 1413 and to track its status, you can visit the Illinois General Assembly website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Illinois Bill Would Legalize Firearm Suppressor Use

“By definition, the primary role of a suppressor is to reduce the overall sound signature of the host firearm to hearing safe levels. They do so by trapping the expanding gasses at the muzzle and allowing them to slowly cool, in a similar fashion to car mufflers. Their muffling capabilities intrinsically make them a hearing protection device for both the shooter and those around them.”

-American Suppressor Association website

Illinois firearm owners might be interested in the following. Brian Brueggemann reported on the Belleville News-Democrat website last Friday:

Hunters and other shooting enthusiasts would be allowed to have silencers on their guns under a bill filed in the Illinois legislature.

The bill’s sponsor, Rep. Brandon Phelps, D-Harrisburg, said gun owners want silencers for a simple reason: to avoid hearing loss.

“There are a lot of veterans, a lot of hunters and shooters, who have suffered hearing loss,” Phelps said.

Phelps acknowledged that gun opponents are likely to challenge the bill.

“I’m used to that. They said that about concealed-carry — they said everybody was going to be running around shooting each other, like the wild west,” Phelps said. “That’s the movies.”

Firearm suppressors (or sound suppressors and silencers as they’re also known) are highly-regulated in the United States. J. Guthrie reported on the Guns & Ammo website back on May 13, 2012:

If you lived in Scotland, they would be required for hunting. If you lived in Finland you could saunter down to the local gun shop and buy one over the counter—one more reason to like Finland. In the U.S., suppressors are regulated by the National Firearms Act and you have to first make sure they are legal in your state, fill out a federal form and send it, a couple of photos and some fingerprints into the BATFE for approval. Once approved—the process can take six or seven months—the BATFE sends you a little stamp and some paperwork and you can take possession of the suppressor from you dealer. There are legal considerations for interstate transportation and transferring the suppressor too…

The suppressor legislation sponsored by Phelps is Illinois House Bill 433 (you can check on its status here). State Senator Bill Haine (D-Alton) has filed the same bill in the Senate.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Brueggemann, Brian. “Bill would allow Illinois gun owners to use silencers.” Belleville News-Democrat. 6 Feb. 2015. (http://www.bnd.com/2015/02/06/3649514_bill-would-allow-illinois-gun.html?rh=1). 11 Feb. 2015.

Guthrie, J. “G&A Basics: How Suppressors Work.” Guns & Ammo. 13 May 2012. (http://www.gunsandammo.com/gear-accessories/suppressors/ga-basics-how-suppressors-work/). 11 Feb. 2015.

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Wednesday, February 11th, 2015 Firearms, Gun Rights, Health, Hunting, Legal, Shooting Sports No Comments

Illinois Governor Bruce Rauner To Push Drastic Spending Cuts, Sales Tax Hike In Near Future?

Some local news outlets have been giving new Illinois Governor Bruce Rauner a hard time lately, claiming he’s still in “campaign mode” and not providing much in the way of tackling the state’s economic ills.

But yesterday, Illinoisans got a glimpse of one potential measure the Winnetka businessman may turn to for improving the state’s finances. Jessie Hellmann and Ray Long reported on the Chicago Tribune website Thursday:

Republican Gov. Bruce Rauner pressed a bit harder Thursday for an expansion of the Illinois sales tax as part of an agenda to right the state’s financial ship.

Using charts and graphs, Rauner explained how surrounding states use broader-based sales taxes than Illinois to take advantage of growing service economies. “We’re not competitive,” Rauner said.

The idea of expanding the state’s sales tax base to include services, such as on auto repairs, dog grooming or haircuts, has been debated in Illinois since the late 1980s. Expansion efforts repeatedly have stalled in the face of heavy resistance, but Rauner outlined how he thinks Illinois is “out of balance” with other states.

“We are not thoughtful about this,” Rauner said, adding that the Illinois sales tax is too high and too narrowly applied.

Expanding the sales tax is one of the few items Rauner repeatedly has mentioned as a part of an unspecific overhaul of the entire tax code, saying Illinois can’t “just nibble around the edges.”

(Editor’s note: Bold added for emphasis)

It’s going to take a whole lot more than a sales tax hike to turn around the state’s economic fortunes. And Governor Rauner knows that.

So what other measures could be on his agenda for the near-term?

Rich Miller discussed the governor’s visit to the University of Chicago on January 22 and wrote on the Crain’s Chicago Business website the following day:

What is crystal clear is that he won’t ask for any more revenues without first making deep and even drastic cuts.

The new governor pointed to flat population growth and flat job growth as the roots of the problem.

Without “booming” growth, he said, Illinois can never dig itself out of the hole it’s in. And Rauner always HAS said that high taxes are a hindrance to growth.

Rauner singled out two items for his chopping block. First up, Medicaid spending.

“When you realize our job growth is flat, how do you pay for it?,” Rauner said of Medicaid. “I want to do that, but that is not sustainable.” Medicaid, which pays for everything from childbirth to nursing home care, consumes a quarter of the state’s operating budget, and despite some real reforms almost two years ago, costs are continuing to rise. And that’s a problem when next fiscal year’s budget deficit is being pegged at a whopping $9 billion.

Rauner also claimed state employees make too much money, saying they earn more than private sector workers (which AFSCME rejects, pointing to a recent University of Illinois study) and are the third-highest paid in the country. The number of state workers is declining, Rauner noted, but payroll costs are still increasing. Their health insurance is based on “low contributions” from workers, but has a high cost. So, while workers aren’t chipping in much, “you’re chipping in a lot,” he told his audience…

(Editor’s note: Bold added for emphasis)

“Deep and even drastic cuts.” “Expansion of the Illinois sales tax.”

It will be interesting to watch how Illinois Democrats- who hold veto-proof supermajorities in both chambers of the Illinois General Assembly- react to such proposals if Governor Rauner goes this route.

This could get ugly real quick…

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Hellmann, Jessie and Long, Ray. “Rauner presses for sales tax expansion in U. of I. speech.” Chicago Tribune. 29 Jan. 2015. (http://www.chicagotribune.com/news/local/politics/ct-bruce-rauner-champaign-appearance-met-0130-20150129-story.html). 30 Jan. 2015.

Miller, Rich. “Watch out: Rauner sharpens his cleaver.” Crain’s Chicago Business. 23 Jan. 2015. (http://www.chicagobusiness.com/article/20150123/NEWS02/150129882/watch-out-rauner-sharpens-his-cleaver). 30 Jan. 2015.

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Chicago, Cook County, Illinois Residents: ‘Sacrifice’ Looming

A lot less government services. Much higher fees, fines and taxes.

An outcome I see for Chicago, Cook County, and Illinois residents down the road.

And based on comments made by Cook County Board President Toni Preckwinkle and new Illinois Governor Bruce Rauner yesterday, our destination is in sight. Governor Rauner said in his inaugural speech Monday:

We have an opportunity to accomplish something historic: to fix years of busted budgets and broken government; to forge a path toward long-term prosperity and a brighter future; to make Illinois the kind of state others aspire to become, a national leader in job growth and education quality.

To achieve that will require sacrifice. Sacrifice by all of us- politicians and interests groups, business and labor, those who pay for government and those who depend on government’s services. Each person here today and all those throughout the state will be called upon to share in the sacrifice so that one day we can again share in Illinois’s prosperity. We all must shake up our old ways of thinking…

The 42nd governor added later on in his address:

Illinois is our home- and right now our home is hurting. But home and family are worth sacrificing for… worth fighting for. Together, let’s do the hard work to rebuild our home…

“Sacrifice.” Call me crazy, but something tells me the burden of bailing out the “Land of Lincoln” won’t be falling upon the backs of the rich and powerful.

Cook County Board President Toni Preckwinkle also gave a speech yesterday in which she hinted at county residents having to make future sacrifices. John Byrne reported on the Chicago Tribune website Monday:

Preckwinkle gave a speech to the City Club of Chicago about her first-term achievements and laid out a blueprint for her second four years in office. Asked afterward about the likelihood she will be forced to raise taxes, Preckwinkle said only that it will be “a challenge” to meet the county’s financial obligations.

“We have significant challenges, both around the spike in our debt obligations and our pension obligations, and my charge to our chief financial officer is that he has to do everything he can to be creative in figuring out how to address these problems,” she said…

Preckwinkle crafted a $4 billion budget for 2015 that includes no new taxes, fines or fees. She has warned that the 2016 budget will be far trickier to balance because debt payments will increase and the county could need to come up with $144 million more to pay into the county workers retirement system if she gets the pension fund changes she has asked for from the General Assembly.

“I can’t predict now, because we don’t even have a pension bill, how much it’s going to cost or what it’s going to take, but it’s going to be a real challenge, I’ll say that,” she said Monday.

(Editor’s note: Bold added for emphasis)

Coupled with Chicago’s financial issues, all I can say to Chicago, Cook County, and Illinois residents at this point in time is- better start figuring out a way to cope with less government services and higher fees/fines/taxes from local and state government in the coming years. The politicians can only kick the can down the road so far.

You can read Governor Rauner’s entire inaugural address on the Chicago Sun-Times website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Byrne, John. “Preckwinkle details 2nd-term plans for Cook County.” Chicago Tribune. 12 Jan. 2015. (http://www.chicagotribune.com/news/ct-preckwinkle-second-term-agenda-met-0113-20150112-story.html). 13 Jan. 2015.

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Project Prepper, Part 32: Security First

Back in Project Prepper, Part 9 (dated February 27, 2013), I talked about the 6 “innate survival needs” that my preparedness efforts for this series of posts would focus on. Jack Spirko of The Survival Podcast (the originator of this list of needs) had “Food” at the top. I wrote:

My gut feeling tells me right now I should be focusing on “Security” before other needs. Why’s that? Because this latest push for more gun “control” that’s going on in America right now could end up limiting my access to a number of tools and other accessories that I could use to construct an effective security setup.

The push for more gun “control” in the wake of the Newtown, Connecticut, school shooting was substantial. And certain firearms, ammunition, and accessories fast became scarce. That being said, federal legislation calling for ammunition magazine and gun bans did not become law. Even so, the availability of certain items (.22 LR ammo comes to mind here) is still affected here at the beginning of 2015.

Regrettably, I believe that another mass shooting on the level of Newtown will happen again here in America. After which, there will undoubtedly be another significant push for gun “control,” and shortages of certain guns and ammo will take place once again. Taking into consideration that I also suspect firearm availability/ownership will be seriously curtailed when the nation’s “financial reckoning day” arrives (along with major civil strife), readers might understand why I’ve made “Security” my top “innate survival need.”

Now, gun “control” is a phenomenon that I am all too familiar with. When I wrote Project Prepper, Part 9, I was living at “ground zero” for gun “control” in America at that time- Chicago, Cook County, Illinois.

Regular readers know that I’ve since moved out of the city and to the suburbs.

However, I still reside in Cook County (for the time being, at least), and as such, am subject to its considerable firearm restrictions.

Despite the setbacks of 2013 and last year, anti-gun sentiment remains strong in the county and in this part of the state. While the relentless push for more gun “control” has been somewhat quiet after the November 2014 election and through the holidays, activity will no doubt pick up again soon. And the next time a major mass shooting takes place in America, I expect legislation banning particular semi-automatic firearms and ammunition magazines to be introduced in the Illinois General Assembly probably before the smoke has even cleared. Trust me- it’s ready. While such a state-level ban wouldn’t mean a whole lot to me (Cook County already has an “Assault Weapon” Ban and 10-round ammunition magazine restriction in place), who’s not to say the County goes even further in the wake of such a tragedy and attempts to ban the future acquisition/possession of semi-automatic firearms, for example? Maybe there won’t even be a grandfather clause, and all semi-autos would now be illegal?

Yep. “Security” remains numero uno on my list of “innate survival needs.”

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Fixed? Illinois Public Pension Gap Surpasses $111 Billion

“The Illinois General Assembly barely passed legislation yesterday that’s been touted to ‘fix’ the state’s $100 billion public pension crisis.

Illinois Governor Pat Quinn, who has promised to sign SB0001, declared in a press release Tuesday:

Since I took the oath of office, I’ve pushed relentlessly for a comprehensive pension reform solution that would erase a $100 billion liability and restore fiscal stability to Illinois.

Today, we have won. The people of Illinois have won.

Not so fast, big guy…”

Survival And Prosperity, December 4, 2013, post

I remember when Illinois Governor Pat Quinn signed off on Illinois Senate Bill 1 (or 0001, take your pick) on December 5 of last year, talk about the State’s monstrous public pension funding gap practically disappeared overnight. But yesterday, Benjamin VanMetre of the Illinois Policy Institute- “an independent research and education organization generating public policy solutions aimed at promoting personal freedom and prosperity in Illinois”- dredged up that nightmare for Illinoisans over at their website. That “$100 billion liability” that was supposed to be “erased.” It’s now more than $111 billion. VanMetre wrote:

Illinois’ unfunded pension liability grew to more than $111 billion this year, according to official estimates. That’s a $48 billion increase just since 2009.

That $111 billion pension shortfall means the state now has only 39 cents of every dollar it should have in the bank today to pay for future benefits. In the private sector, these funds would be deemed bankrupt…

Illinois Senate Bill 1, which was touted to reduce the State’s annual pension payment by more than $1 billion, is currently facing a legal challenge. VanMetre added:

But as we wait for a decision, Illinois’ pension debt continues to grow. The state’s pension payment for the current budget year totals $6.9 billion, and without reform, that pension payment will balloon to $7.6 billion for the 2016 budget year; an increase of $681 million…

(Editor’s note: Bold added for emphasis)

So what’s the likelihood of the courts shooting down this new public pension law? As I wrote in that December 4, 2013, post:

This legislation is almost certainly headed to court, as in the Illinois Supreme Court. As I noted on December 1, a provision of the 1970 Illinois Constitution defines public pension benefits as “an enforceable contractual relationship” that “shall not be diminished or impaired.”

And even if it passes constitutional muster, consider what I also added in that post:

As I blogged yesterday, the Wall Street Journal recently picked apart the legislative “fix,” and concluded not only was it “fake” but:

Even under the most optimistic forecasts, these nips and tucks would only slim the state’s pension liability down to $80 billion- which is where it was after Governor Quinn signed de minimis fixes in spring 2010 to get him past that year’s election…

“$80 billion.”

Stay tuned…

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

VanMetre, Benjamin. “Illinois’ Pension Debt Balloons To $111 Billion.” Illinois Policy Institute. 17 Nov. 2014. (http://www.illinoispolicy.org/illinois-pension-debt-still-ballooning/). 18 Nov. 2014.

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2015 Cook County Budget Holds Line On Taxes, Fines, And Fees- For Now

Cook County residents dodged a bullet this time around.

John Byrne and Hal Dardick reported on the Chicago Tribune website Friday:

Cook County Board President Toni Preckwinkle on Friday won easy approval for her $4 billion 2015 budget proposal that includes no new taxes, fines or fees

(Editor’s note: Bold added for emphasis)

For now. Byrne and Dardick added:

Preckwinkle earlier this year warned that the 2016 budget will be far more difficult to balance because debt payments will grow and the county will need to pay $144 million more into the county workers’ retirement system if she secures the pension fund changes she seeks from the General Assembly…

(Editor’s note: Bold added for emphasis)

Regular readers of Survival And Prosperity know I suspect those “new taxes, fines, or fees” are coming soon. I wrote back on May 22:

Last week, I blogged about the possibility of property and/or sales taxes going up soon in Cook County, Illinois. Dave McKinney and Brian Slodysko reported on the Chicago Sun-Times website on May 13 the hikes might occur as part of a pension “reform” bill.

Hal Dardick and Monique Garcia added on the Chicago Tribune website tonight:

Cook County Board President Toni Preckwinkle hit Springfield Thursday to try to build support for changes to the county pension plan that she says would halt its ongoing decline toward insolvency.

She met with Senate President John Cullerton House Speaker Michael Madigan, both Chicago Democrats, and also Republican legislative leaders. “I think she’s got a good chance to pass this bill,” Madigan said afterward…

Although Preckwinkle has not identified how she would pay for her plan, it calls for the county to put $144 million a year into the pension fund. If funded with property taxes, that would cost the average homeowner up to $65 more a year, starting in 2017, according to one internal county document the Tribune obtained.

Preckwinkle, however, said Wednesday that she has closed even larger budget gaps through cuts and other, smaller scale tax and fee increases without raising property taxes — while also lowering the county sales tax by a half-cent on the dollar…

(Editor’s note: Bold added for emphasis)

Yet, McKinney and Slodysko wrote last week:

County officials do not believe they can cut enough from the budget to cover the cost, the source said…

(Editor’s note: Bold added for emphasis)

Only a matter of time now before those hikes kick in. As I also noted in that May post:

What’s that line I keep repeating on this blog?

Higher fees, fines, and taxes. Less government services.

As much as I hate saying it, that’s what Chicago and Cook County residents should be preparing themselves for down the road.

I’d say that probably applies to all Americans, come to think of it.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Byrne, John and Dardick, Hal. “Preckwinkle wins easy approval of $4 billion budget.” Chicago Tribune. 14 Nov. 2014. (http://www.chicagotribune.com/news/ct-cook-county-budget-met-1115-20141114-story.html). 17 Nov. 2014.

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