Illinois Public Media News
Area General Motors dealers are looking at the automaker's bankruptcy from different perspectives.
Most dealers in east-central Illinois expect to keep selling cars despite GM's decision to cut hundreds of dealers. Bill Abbott owns a GM dealership in Monticello -- he says his company didn't receive a contract cancellation notice, and they are looking forward to being there for a long time.
Hoopeston dealership owner Dave McFadden says he's also not worried about the future of Anthem Chevrolet Buick Pontiac, and he's optimistic about what a new GM will look like.
"I'm looking forward to a new GM emerging, being more competitive with less liabilities and returning to the giant automotive manufacturer that it has been for almost a hundred years," McFadden said.
But a small Chevrolet dealer in Iroquois County may not be a part of GM's future. Still, Rust Chevrolet doesn't plan on closing anytime soon, despite receiving a letter ending its franchise agreement with GM.
Co-owner Karen Rust Walder says the family-owned operation in Cissna Park will continue offering parts and service and plans to keep selling used vehicles when their agreement with GM ends in 2010.
Walder says she knows that some dealerships plan to fight the contract termination, but as for Rust Chevrolet, she says they don't really know what their next step will be.
The Rust family has sold Chevrolet vehicles since her grandfather signed on with the car company in 1915. Walder is the only salesperson at the dealership.
Illinois lawmakers have approved a state budget that only provides about six months of funding for agencies and programs. Governor Pat Quinn says that won't do.
Quinn is calling a summit with legislative leaders today at the Capitol in the hopes of breaking a logjam over raising taxes. Quinn says the state needs an income tax hike to help dig out of a huge deficit.
Quinn says he has no plans to act on what's been termed a "lights on" budget, designed to keep government operating if no compromise is reached by the start of the new fiscal year July first. Lawmakers left Springfield early this morning but could be called back to town in the future. Quinn downplays speculation of a long, drawn out budget battle.
"I happen to be a repair man," Quinn said. "I understand in a bad situation, find the hole in the roof and repair it."
But Quinn had little success in working with fellow Democrats who control the legislature, and Republicans are refusing to climb on board with a tax increase. More votes will now be needed to pass a tax hike. Quinn won't say what he'll do if his talks with legislative leaders fails to result in a break through. He says the budget lawmakers approved would result in severe cuts to services and calls that unacceptable.
Champaign's Strategic Capital Bank re-opens Tuesday today under new ownership. State banking regulators closed the ten-year-old bank on Friday, and handed it over to the Federal Deposit Insurance Corporation. Today (Tuesday), the bank reopens as a branch of Effingham-based Midland States Bank. All deposits and loans are being transferred to Midland States Banks, and officials say customers should see no disruptions in service.
FDIC spokesman David Barr says Strategic Capital apparently ran into financial trouble due to its buying so-called private label mortage-backed securities and making commercial real estate loans. He says that left the bank vulnerable when the housing market and economy suffered a downturn, with home loans and commercial real estate loans taking the biggest hit."And with this bank having a lot of its assets concentrated in those two areas, it had a really adverse impact on their financial condition", says Barr.
Barr says the FDIC will keep a toll-free phone number open this week for former Strategic Capital customers with questions about the bank takeover. Calls will be taken from 8 AM to 8 PM, at 1-866-954-9527. That's 1-866-954-9527.
Besides Strategic Capital bank, state banking regulators shut down Citizens National Bank of Macomb last Friday. That makes a total of five bank failures in Illinois so far this year.
Illinois Gov. Pat Quinn's plan to reform the public pension system to save money would actually cost $95 billion extra over the next three decades.
Documents obtained by The Associated Press show Quinn would cut in half the amount of money the state would put into retirement systems for state employees in the next five years. But those short-term savings would be accompanied by much larger long-term costs.
The total cost would be $532 billion through 2045, up from $437 billion under the current pension plan.
Representatives of employees' unions and a legislative finance commission criticized the idea.
Quinn is trying to close an $11.6 billion deficit by raising income taxes and cutting spending. He has proposed lowering pension benefits for new employees to save money.
Last week's sudden closure of a residential hotel in Champaign forced dozens of people to look for a place to live on short notice. It also forced the City of Champaign into action - not just to condemn the Gateway Studios for lack of utilities, but to help arrange housing for those residents, most of them low-income. Housing advocates see the evictions - and a similar incident at the Autumn Glen apartment Complex in Rantoul - to call for changes in housing policy in Champaign and Urbana. Former Urbana alderman Danielle Chynoweth has brought a proposal to the Champaign and Urbana city councils to offer cash assistance for relocation to people left homeless by condemnation - the landlord would be held responsible for that money. She spoke with AM 580's Tom Rogers.
The head of Champaign's Neighborhood Services department, Kevin Jackson, told AM 580's Jim Meadows last week that while rental help is available from agencies, some of it is based on the applicant's background. Jackson says the city is open to discussion on permanent policy changes.
Chrysler is closing one out of every four of its dealerships, and the effect will be felt in central Illinois.
O'Brien Auto Group's Chrysler dealership in Urbana is on a list of nearly 800 closures, as are the Chrysler and Jeep franchises at Danville's Carmack Car Capitol and all Chrysler brands at Tuscola's Four Seasons Auto Plaza. Decatur-based Bob Ridings is losing Chrysler brands at its main dealership as well as those in Taylorville and Jacksonville. The owner of the Carmack firm in Danville, Gary Knight, said he was not expecting to see the notice from Chrysler but had no further comment - neither did a spokesman for Four Seasons.
Chrysler has about 3,200 dealers, but the bankrupt automaker says that's too many. It wants to have stronger, more profitable dealers with better facilities.
A week full of classes and events in Champaign County is aimed at helping people guide their personal finances through the tough economy.
The Chicago Federal Reserve is kicking off Money Smart Week this week in several Illinois communities. It's meant to boost financial literacy in a time when it's more important than ever.
One of the advisory committee members in Champaign County is Parkland College president Tom Ramage, who says students and their families can use the courses to chart their immediate and long-term financial futures.
"This gives students the opportunity to get direct answers to specific questions they might have in a short, free -- which is a key word -- experience where they can spend a couple hours, or a couple days, on a specific topic that's relevant, timely to them," Ramage said.
Nearly 25 community agencies, banks, schools and other groups are putting on classes and seminars ranging from basic saving and investing to making budgets and preventing against identity theft.
You can find a schedule of events at the Chicago Fed's website, moneysmartweek.org.
General Growth Properties Inc., the nation's second-largest mall operator, says it has filed for bankruptcy protection after failing to convince its debt holders to give it more time to refinance its crushing debt.
The Chicago-based real estate investment trust said early Thursday it filed for Chapter 11 bankruptcy protection in a New York court. Some 158 regional shopping centers under its control also filed for bankruptcy protection.
The company owns Champaign's Market Place Mall.
General Growth says it received a financing commitment from Pershing Square Capital Management LP of about $375 million and expects it will be able to continue operating its malls as it reorganizes.
The operator of jewelry store in Market Place says most changes coming out of the bankruptcy announcement won't impact the common shopper.
Eric Connery... whose family owns Bauble's.... says he knew this news was coming for the past several months. But he believes having a lease intact makes his store an asset instead of a liability. Connery recently renewed the lease for another year.
He says other than some possible changes in management... it should be business as usual at the mall:
"Their financial problems are so far beyond the mall level they wouldn't affect us," Connery said. "I don't foreseeing anything changing for the negative. The only thing I'd see happening is maybe you'll have some different people in different positions, and change isn't always a bad thing."
Connery says General Growth Properties is just a company that needs time to get its finances restructured... and he expects its ownership of the Champaign mall to remain intact.
(from AM 580 and The Associated Press)
Backers of health insurance reform in Illinois say companies need to put care for their recipients ahead of executive bonuses.
The AARP and state Public Interest Research Group, or PIRG, are among those urging state senators to follow the example of the Illinois House, and pass the Health Insurance Consumer Protection Act.
The measure would require insurance companies to spend at least 75% of premium dollars on medical care instead of executive salaries, marketing, or profits. 76-year old Felicia Boss of Champaign says her monthly premium went up more than 60 dollars from one year to the next without any explanation. "You have to accept it, you can't live without it," says Boss. "I know many residents where I live are looking into new plans, if they can find something. And so if there was full disclosure out there for us from the companies, at least we'd be able to choose for ourselves what would best fit our budget." The bill would also allow the Office of Consumer Health Insurance to function as a watchdog group to ensure companies aren't denying claims or hiking premiums. The measure passed the Illinois House last week. Lawmakers, including senators, are currently on break, and return two weeks from today.
A spokeswoman for Urbana-based Health Alliance Medical Plans says 90-percent of the company's premiums are going to medical care. But Jane Hayes says Health Alliance is concerned that the bill as currently written doesn't allow insurance providers to provide input to help determine company standards.
The operator of Boardman's Art Theatre in Champaign is apparently looking to relocate as the building's owner looks for either a new tenant, or to sell the facility for another use.
Owner David Kraft says the rent of 4 dollars a square foot he's charging isn't near the market rate... and he can't afford to charge that little when factoring in expenses like real estate tax, water, trash, and sewer rates. Kraft says he's made operator Greg Boardman an offer of just under 9-dollars a square foot.
"If he won't pay that and no one will pay that, then I think everybody needs to look and determine if there's demand for this, if there's sufficient interest," Kraft said. "If no one is willing to pay near market rent, then maybe we do have to look at different ideas."
Kraft suggests there may not be room for a movie theater anymore when considering what other downtown businesses are paying for first floor retail space. He's looking to sell the Church Street building for just over $1 million.
Kraft says he's drawn interest for other theater operators, but nothing concrete.
Boardman's lease on the Church Street location expires in December. He couldn't be reached for comment, but the co-owner of a building across the street... Bill Capel... confirms Boardman toured his facility last month. That building houses the old Rialto Theater. Capel says any talk of moving Boardman's there would include extensive talk about renovations.
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