Range of services at risk due to city, state budgets
MAXED OUT | A wide range of services are at risk because the city and state -- and to a lesser extent Cook County -- are in deep financial trouble and headed for worse
BY MARY WISNIEWSKI, LISA DONOVAN, DAVE McKINNEY AND FRAN SPIELMAN
Copyright by The Chicago Sun-Times
February 28, 2010
It's a gray winter morning in Chicago 2012. You're a single mom, waiting in the snow for a bus.
You lost your job last year as a teaching assistant in the public schools. You'd go back to college to learn new skills, but tuition's high, and financial aid programs are gone.
A SUN-TIMES SERIES Facing up to our local and state budget crisis Today, you're heading downtown to fill out job applications. The bus ride costs $3.50 -- and service is half what it was.
You hope you get back in time to get the kids -- after-school programs are gone, and the streets are scary. Maybe you can take them to the library later -- no, wait, the library's closed on Mondays.
This could be the future -- if the state, city and county budgets continue on their current path. Life for all of us could be poorer, harder, more dangerous, more polluted.
"If these trends continue, what you'll see is the speeding-up of the deterioration of the state," said Ralph Martire, executive director of the Center for Tax and Budget Accountability, a Chicago think tank.
Like a frog in a gradually warming pot of water, not everyone notices the trouble brewing. But budget problems have already hurt the Chicago area's way of life -- public transit is shrinking, library hours have been cut, and public schools are laying off employees by the hundreds. And it looks like things can only get worse.
The city shrinks
Take Chicago. In better days, Mayor Daley enjoyed a booming housing market that saw real estate sales taxes growing by double digits every year.
The mayor indulged his beautification fix by putting up median planters and wrought-iron fences. He built the $475 million Millennium Park.
Then the revenue balloon burst. Daley ended up balancing his 2009 budget by laying off 929 city workers and slowing police hiring to a crawl.
To get some cash, the mayor pressured the City Council to approve a 75-year, $1.15 billion deal to privatize Chicago parking meters tied to a steep schedule of rate hikes. To erase a $520 million 2010 budget shortfall without raising taxes, he had to use nearly all of the reserves from the parking-meter deal -- money he once called untouchable. An attempt to squeeze money out of a privatization of Midway Airport fell through.
With some exceptions, city employees were forced to take 24 unpaid furlough days. Library hours were cut by 20 percent. The city's popular Venetian Night celebration and the Grant Park July 3 fireworks extravaganza are gone, and another day will be shaved off the already-reduced Chicago Jazz Fest. The citywide switch to blue-cart recycling is stalled. The Chicago Police Department is more than 2,000 officers a day short of its authorized strength, and Supt. Jody Weis fears this will get worse because as many as 1,000 more officers are expected to retire in 2011.
The worst problem is the city's pension burden. And if pension funds run out of money, Chicago taxpayers will get stuck with the tab.
Mass transit dwindles
While the city struggles with staff and program cuts, the CTA, which carries Chicagoans to jobs and entertainment, has had to shrink. The state borrowed money to avoid fare increases until 2012, but the transit agency still cut bus service by 18 percent and L service by 9 percent, while laying off 1,057 workers. Pace, the suburban bus service, cut back its routes.
And the cuts might not be over. The CTA, Metra and Pace are owed $250 million in state funds and might have to cut service this summer if they don't get the money. The CTA also needs $7 billion in capital money to bring the system into a state of good repair -- or it will get more expensive to run.
"If the state falls further behind, and I expect it will if there is no solution, we're going to be stealing from our capital program, and we're probably going to be looking into service cuts and two years from now a fare increase," said RTA executive director Stephen Schlickman.
"The magnitude of it -- I can't fathom."
The state disaster
As bad as things are for mass transit, the amount that transit agencies are owed by the state is trifling compared with what's due the public schools and health-care systems. Universities alone are owed $735 million. The state's deficit has ballooned to $12.8 billion. That includes unpaid bills, pension-repayment costs and a reduction in federal stimulus dollars.
Dealing with it has ignited partisan warfare in Springfield, where Republicans generally favor cutting their way out of the budget mess, while Democrats are pushing for a mix of cuts and raising revenues.
A tax increase seems unlikely this spring, if only because of election-year fears, though most expect Gov. Quinn to again propose boosting the state's 3 percent income tax. Anti-incumbency fervor among voters had emboldened Statehouse Republicans pushing a no-new-taxes platform.
"Last year would have been a better opportunity to pass it than this year," House Speaker Michael Madigan said.
Madigan blames Republicans, whom he has taken to calling "non-participating dropouts," for failing to put partisanship aside and find more funding for vital state services.
Sen. Bill Brady (R-Bloomington), the likely Republican nominee for governor, has vowed not to raise taxes if elected -- and promises $1 billion in tax cuts. Brady said Democrats have run up record deficits, pushing private investment out of the state and costing jobs.
"We'll stand lockstep against tax increases because that's not the solution," Brady said.
Martire warns that, without new revenue, programs for the developmentally disabled, homebound seniors and those with mental-health issues will be scrapped, and public school students will lose programs. He also worries about fewer safety inspectors for bridges, food, railway crossings and water systems.
"I could see a significant rail accident happening -- the train wreck everyone talks about," Martire said.
County tax backlash
For all the calls for new taxes, one need look no further than Cook County to see how unpopular, and problematic, a tax hike can be.
In 2007, Cook County cut 1,700 jobs -- including nurses and prosecutors. A year later, Cook County Board President Todd Stroger pushed the overall sales tax to 10.25 percent, the highest in the country. He was voted out of office largely over that.
While Stroger said the tax hike kept the hospital system healthy, others argued that it merely dodged the hard job of cutting patronage and bloat, while sending shoppers across the county line. Barrington Hills, just inside Cook County's border, saw a 34.3 percent drop in sales tax receipts in the second quarter of 2009, according to a DePaul University study.
"This just allowed us to fill our coffers with $350 million to $400 million in revenues when all we had to do is make the necessary cuts to remove the waste," said Cook County Commissioner Tim Schneider, a northwest suburban Republican.
Laurence Msall of the Civic Federation, a tax watchdog group, said that while Cook County does not face the same immediate crisis as Illinois, it has long-term problems because of wasteful spending. Though Msall favors an Illinois personal income-tax hike, he said he thinks the last half penny of the county increase should be repealed. "That was never tied to a justified plan for how the money would be spent," Msall said.
It doesn't seem like there's an easy way out for the City of Chicago, or Cook County or the State of Illinois. Every choice looks painful, whether it's raising taxes, cutting programs or a mix of both. Neither new federal stimulus money nor an uptick in the economy alone can save us, said Joseph Schwieterman, director of DePaul University's Chaddick Institute for Metropolitan Development.
"If we can't make some really hard choices now, we're clearly incapable of fixing the problem," said Schwieterman. "I've never felt such a gloomy time."