Illinois Public Media News
A federal commission made up of members of Congress and former lawmakers is trying to reduce the nation's federal deficit by $4 trillion dollars by 2020 with changes to government programs, including Medicare and Social Security services.
Based in Washington, DC, the 18-member National Commission on Fiscal Responsibility and Reform is led by former senator Alan Simpson (R-Wyo.) and former Clinton Chief of Staff Erskine Bowles. Both leaders are backing a plan to make cuts to Medicare funding that would limit federal spending on Medicare recipients to one percent above the economy's gross domestic product. Anne Gargano Ahmed, who is with Champaign County Health Care Consumers, said under that plan, the cost for care would then be pushed onto Medicare beneficiaries with higher premiums.
"Medicare beneficiaries would then have to choose to pay higher premiums for traditional Medicare, or buying a private plan from a Medicare exchange of private insurance companies that would offer a plan as an alternative to Medicare," Ahmed explained. "These plans might have lower premiums, but they'd probably offer less coverage like many private insurance plans do now."
Illinois has two legislatures sitting on the panel: Senator Dick Durbin (D-IL) and Rep. Jan Schakowsky (D-IL). The healthcare advocacy group backs a proposal by Schakowsky calling for the creation of a Medicare-administered drug plan to compete with private plans. She also wants Medicare to use its bargaining power to negotiate for lower drug prices, a move that the Congressional Budget Office estimates will save the country $14 billion by 2015.
The financial commission is also considering a plan to increase the retirement age for full Social Security benefits to 69 by 2075. According to the non-partisan group Social Security Works, boosting the retirement age by that amount would lead to a 21-percent cut in benefits from the current retirement age of 66.
Claudia Lennhoff, executive director of Champaign County Health Care Consumers, said trimming any part of social security is the last thing the federal government should do to help cut the deficit. Lennhoff said because social security is supported by payroll deductions and not federal dollars, it does not add to the deficit.
"Social security does not contribute to the budget deficit," Lennhoff said. "So it's like trying to find an answer that wasn't part of the problem, and at great consequence to the American people, at great harm to the American people. It's simply not fair."
However, Lennhoff admitted that one area her group agrees with the commission's leaders on is raising the wage cap on the amount of money going to support Social Security. The cap is currently set at $106,800.00, and Lennhoff said increasing it would require people making more than that amount to pay more to support social security benefits.
The commission has until December 1st to finalize and vote on a plan. It must capture 14 of 18 votes among its members to adopt a budget recommendation, and send it onto Congress for consideration.
Union workers in Champaign's fire and police departments are hoping to compromise with city leaders rather than lose staff, services, or both.
Public works employees could also be among as many as 15 positions cut, as the city looks to trim nearly $2-million from the budget in the current fiscal year, and a total of $4-point-3 million in 18 months. Champaign Police Officer Joe Johnston, 21, chairs the labor committee with the local Fraternal Order of Police. He said reducing front desk staff and the records division means he's a less effective officer.
"Can I do their job? Yes. Can I do it as well or as efficient as them? Absolutely not," Johnston said. "But I guess what I'm trying to say - the point I'm trying to make with that is by taking me or one of the other officers off the street, we have now diminished the services to the citizens of Champaign."
About 20 members from AFSCME and other unions were on hand last night to oppose the job cuts, but Council member Tom Bruno said they need to do better.
"It's not helpful to have various units of city employees come to us and say 'not us.' Anybody else but not us," Bruno said. "I don't find that particularly helpful as a problem-solving technique."
Current proposals also include reducing staff at Fire Station 4 on John Street. Carrol Whitehouse, a Campaign firefighter and union vice president, said that could mean lost response time, particularly if one of its units is already out on a fire or medical call. Whitehouse said the union wants to work out a way to avoid cutting core services, but would not say if that included taking a pay cut since his union is involved in negotiations.
"All of the funding problems are going to be generated by increases in employee compensation," Whitehouse said. "And we're willing to find ways to deal with that that will zero-out the impact of the city, but not impact the core jobs that we do."
The budget strategy endorsed by the city council in Tuesday night's study session also includes enacting a furlough program for AFSCME union workers and a voluntary separation program. Both will be discussed more in January. Champaign City Manager Steve Carter said this is the most difficult financial situation he ha seen in 40 years of working in local government. The city has already enacted $9-million in budget adjustments over the past few years.
The war in Afghanistan is nearing its 10-year anniversary, and Republican Congressman Tim Johnson of Urbana has signed a letter with three House Republicans and 57 House Democrats calling for an end to U.S. military operations in the country. The letter follows statements by the Obama administration setting 2014 as the key date when Afghan security forces should be ready to take control of defense operations.
At this weekend's NATO summit in Portugal, President Obama said he's confident the U.S. will be able to go ahead with its troop pullout plan from Afghanistan beginning in July 2011. Johnson told Illinois Public Media's Sean Powers that the war in unwinnable and dragging down the nation's debt.
(Photo courtesy of The U.S. Army/flickr)
The University of Illinois' Board of Trustees unanimously approved changes to the U of I's administrative structure during its Thursday meeting in Chicago.
The Board of Trustees gave the university the green light to hire a new vice president who will oversee the health science departments at the Chicago and Urbana campuses as well as at training clinics in Chicago, Urbana, Rockford, and Peoria.
The board also voted to expand the role of the vice president for technology and economic development to include a $716 million research portfolio that includes research on the three campuses. The office will streamline research-related policies and processes, which according to the university will eliminate redundancies.
The third proposal that the board approved was a measure that adds the title of vice president to each of the campus chancellors, and specifies that the president of the university will be known as the president of each campus.
University spokesman Tom Hardy said the administrative changes will help the U of I cut costs by allowing University President Michael Hogan to "establish clear lines of authority to begin to consolidate operations."
"You need leadership at the top to drive that process," Hogan said. "Without it, reform doesn't get done or doesn't get done effectively."
Hogan added that a strong administration will ensure the three campuses work together, and advance research opportunities while maintaining distinctive qualities that make each campus unique.
The changes come more than two weeks after the Urbana Faculty Senate rejected the restructuring plan, citing the cost of hiring an additional vice president as one area of concern.
Joyce Tolliver, who chairs the senate's Executive Committee, said the faculty senate is still concerned about some of the administrative changes, but she said she is encouraged that before each meeting, the Board of Trustees will start holding conference calls with chairs of different faculty committees on each campus. This is a move that she said will create more transparency between the Board of Trustees and the rest of the U of I community.
"It's not that there's anything that we asked about before that we're not concerned about now," Tolliver said. "All the questions are still there, but what I am confident about is that they will be answered going forward."
The Board of Trustees targeted a 2012 goal of reducing the university's administrative costs by five-to-ten percent.
Some of the recommendations for consolidating 'back-office' administrative functions throughout the University were outlined in a June report by the Administrative Review and Restructuring (ARR) working group, which made 43 recommendations for potentially $58 million in cost savings.
The University of Illinois plans to close its Police Training Institute by the end of 2011.
The decision to eliminate the training facility comes after a budget review panel raised concerns about the institute's long term economic stability.
The latest in a series of Urbana campus reviews looking at cost-saving measures at the U of I said there is no justification for the university to provide $900,000 a year to train police officers.
"We believe this decision to be necessary because we cannot justify using resources to fund PTI that derive from student tuition and the shrinking state funding available for our core education and research missions," according to the 'Next Steps' letter released by Interim Chancellor and Provost Robert Easter and Interim Vice Chancellor for Academic Affairs as part of a recent 'Stewarding Excellence' report. "Fundamentally, our primary mission of educating lllinois' undergraduate, graduate and professional students must remain a priority."
U of I spokeswoman Robin Kaler said the university can no longer rely on tuition dollars to keep the program going.
"The university has a very proud history of supporting law enforcement training," Kaler said. "Funding for this purpose hasn't kept pace with the increase in costs, and so we had to review where this kind of training falls within the missions and the priorities of the campus as a whole."
With the closure of the 55-year-old training program, Champaign County Sheriff Dan Walsh predicts that police training will be moved to the Illinois State Police Training Academy in Springfield. Walsh, who was trained at the PTI and now teaches there, said it is unfortunate that the program will leave the university.
"I think it is advantageous to have it part of the University of Illinois because the police officers then at least socially during the 12 weeks there here can interact with students from literally around the world," Walsh said. "I think it's a good thing for diversity training."
The PTI has cut its expenses by 45 percent in the last three years, and the report said the institute could improve its cost structure by trimming $666,251 from its budget. Still, the commission said the chances that the institute will latch onto additional funding or new partnerships are slim. The PTI is considered Illinois' flagship training facility.
(Photo courtesy of the Police Training Institute)
Following Verizon Wireless' announcement in October that it would refund customers $53 million in unnecessary charges, the Citizens Utility Board (CUB) has come out with a report assessing Illinois' wireless industry.
The study found that cell phone users could save around $360 a year by identifying billing errors, cutting down on the number of available minutes, and not paying extra for cell phone insurance or roadside assistance.
Bryan McDaniel, a senior policy analyst with CUB, said high wireless rates are costing Champaign residents more than $13 million a year. Across the state he said it is much higher at just under a billion dollars. McDaniel said trimming cell phone bills could help the state's sluggish economy, as businesses struggle to stay afloat.
"If we didn't give that $13 million to the cell phone companies, and instead to local businesses and mom and pop shops, that'd be a good thing for our economy," McDaniel said. "Unfortunately every month, we're throwing away money to these cell phone companies when we don't need to be."
According to the report, the wireless industry should start providing more flexible plans, so that people are not deadlocked into paying extra for features that they do not want.
"Allow people to have 150 minute plans," McDaniel said. "I can't tell you the number of seniors I've talked to who just want a simple 100 minute plan that they can't get anymore."
McDaniel added that consumers also have a responsibility to trim their cell phone rates. He explained that they can visit Cellphone Saver, a free online service that allows users to upload an online copy of their wireless bills - AT&T, Verizon, Sprint, T-Mobile, and U.S. Cellular. Within a few seconds, the website spits out an analysis showing consumers how to cut their costs. The study used the web service to track data from August 2009 though July 2010.
(Photo courtesy of Major Clanger/flickr)
Months after a federal government U-turn in the long-running FutureGen clean-coal project, six Illinois locations have expressed interest in hosting a carbon dioxide storage site that could mean more than 1,000 short-term jobs and a few dozen permanent ones.
The bidders behind one of those locations, though, said Tuesday that their interest is laced with a heavy dose of skepticism after watching what appeared to be politics almost derail the project and then make radical changes in it.
The six locations that submitted bids before Monday's deadline are the city of Quincy; Christian County; the city of Tuscola along with Douglas County; Morgan County; Pike County; and the city of Vandalia along with Fayette County, FutureGen Alliance spokesman Lawrence Pacheco told the Associated Press on Tuesday. The alliance is made up of coal companies and other firms working with the federal government on the project.
"Our team of scientific and engineering experts has already begun review of those proposals, and we look forward to making an announcement on the final site in early 2011,'' FutureGen CEO Ken Humphreys said.
Until earlier this year the plan called for building a new power plant in Mattoon, Ill. and storing the carbon dioxide it produced just outside town. But the Department of Energy decided instead to use $1.2 billion in federal stimulus funding to refit an existing coal-burning Ameren plant in Meredosia, Ill., with different technology and pipe the carbon dioxide, a major greenhouse gas, to another location for underground storage. That site would also become home to an education center to train people to build carbon dioxide pipelines.
The department said that, with delays in the FutureGen project, other projects had already bypassed the technology it had hoped to use in Mattoon.
The project had already been shelved once by the administration of President George W. Bush, only to be revived under President Barack Obama.
Many people in Mattoon tired of what they saw as politics holding up and changing the project, and the town withdrew.
Tuscola was among the four finalists, along with Mattoon, for the original project, and already had in hand much of the environmental and geological testing needed to bid to store the project's carbon dioxide, said Brian Moody, executive director of Tuscola Economic Development Inc. The area is interested, he said, but needs to know more from the Department of Energy about its plans.
"There's definitely a level of cynicism that we all have,'' he said. "It's obvious with the project, once it's gotten out of the site selection process and has been in the political realm, that's where it's had some problems."
"While we're generally supportive of the concept, we still need to know a lot more,'' Moody said. "In order to do that, we need to keep our name in the game."
Looking at the potential jobs, officials in Vandalia aren't nearly as skeptical, Mayor Rick Gottman said.
Unemployment in the area was 10.2 percent in September, the most recent month for which the Illinois Department of Employment Security has data.
Over the past few years, one major employer, Orgill Inc., moved a distribution center and about 140 jobs out of state, Gottman said. Another, Graham Packaging, has reduced its work force from about 800 to roughly 200.
"We're in a high unemployment area right now,'' he said. "We're looking at ways to create jobs.
Nonprofit groups in Central Illinois can start applying for low-interest loans of up to $15,000.
The loans are being distributed by the Community Foundation of East Central Illinois, which received a $100,000 grant from the Marajen Stevick Foundation to run the program.
Joan Dixon, executive director of the Community Foundation, said the state's economic woes have had a ripple effect on many businesses, resulting in staff cuts and program reductions. Dixon said after reviewing more than 120 nonprofit groups, she found that the most pressing concern among struggling organizations was the state's five to six billion dollar backlog of unpaid bills. She said the loan is not meant to be a temporary solution.
"This would be a way - we hope - for a not-for-profit to bridge the gap between their situations right now, and when they get their state promised checks," she said. "If the situation is very dire, and $15,000 is just going to buy you another month, that might not be the right approach to take, but we would help them try to figure those kinds of things out."
Groups that apply for the loan would be charged a $25 dollar registration fee and required to show detailed financial records. The loans, which would carry a one to two percent interest rate, would have to be repaid within 12 months.
Dixon said she hopes the program can continue revolving in this way, so that many nonprofit groups can benefit from the loan.
Officials from Dynergy Inc. have raised concerns about the Vermilion Power Station's long-term stability.
The Houston-based company owns four power plants in Illinois, in addition to the Vermilion plant located near Oakwood. Dynergy spokesman David Byford said because of challenging market conditions coupled with the cost of transporting coal that is trucked to the plant, his company is looking at 'options' for the 54-year-old power station.
"For the short term, it's business as usual for the plant," Byford said.
Byford would not go into detail about what options the company's pursuing.
Dynegy may soon merge with the Blackstone Group for about $4.7 billion, which would include the assumption of Dynegy's debt. Dynegy Shareholders are scheduled to vote on the merger next week in Houston.
University of Illinois President Michael Hogan said it is hard to say how much tuition will go up in the 2011-2012 school year, but he said students and parents 'won't stomach' another one of 9 to 10 percent.
Administrators plan to recommend the amount of that increase by January. The uncertainty over state funding the past couple of years has prompted the U of I to wait as late as June to approve the next fall's tuition.However, Hogan said administrators cannot continue to keep parents and students waiting.
"That doesn't work very well for us for planning purposes, and recruiting students," he said. "Because it doesn't allow us to tell students (about tuition), half of them get some form of financial assistance. So students that are applying here need to know sooner rather than later if they're getting in, and what their financial aid package will be. Or they go somewhere else."
Hogan made his comments following a presentation on tuition and affordability at the U of I Board of Trustees' Audit and Budget committee meeting. He said the drop of state support in the past decade has been 'staggering.'
Associate Vice President for Planning and Budget Randy Kangas said the U of I's appropriation is below what it was for the 1999 Fiscal Year, before adjusting for inflation. The university is currently owed about $320-million in state appropriations.
Hogan emphasized that last year's increase of 9.5 percent was one of the lowest tuition hikes in the country.
"So we've got to change the rhetoric of what we're looking at," Hogan said. "Rather than the one big bump (9.5%) to get a realistic understanding of what students are actually going to pay year in and year out as they go through a 4-year degree program.
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