Illinois Insights: An Update from Cozen O’Connor Public Strategies (4/14)

PUBLIC HEALTH 

— IDPH Reports 6 Illinois Counties at an Elevated Community Level for COVID-19, from the Illinois Department of Public Health.

ILLINOIS

Cook County looks to fix pension plan

A bill (SB1690) sponsored by Sen. Rob Martwick (D-Chicago) at the request of Cook County Board President Toni Preckwinkle and moving its way through the state legislature would look to stabilize the Cook County Pension Fund and increase pension benefits for Cook County’s current and future retirees.

One part of the bill would codify the practice of contributing more to the pension fund than is actuarially required, which Preckwinkle began a few years ago to account for previous underfunding.

The second part would allow Preckwinkle to appoint two additional members to the pension system board. Currently, she and County Treasurer Maria Pappas each select one person to the nine-member board – the seven others are elected by workers and retirees.

The third clause would increase the maximum wage base for pensions from the current $123,489 to the Social Security standard of $160,000. This clause, however, is facing pushback from opponents who say the measure would shift costs onto local taxpayers. Civic Federation acting President Sarah Wetmore is calling for additional insight into the bill’s effects on other pension systems statewide.

Martwick says the measure is necessary to address a flaw in the 2010 law that allowed for the creation of a second tier for newly hired government workers. The state senator has argued that the issue is unsustainable because federal law requires pension systems that substitute their pensions for Social Security to pay at least equal benefits.

Still, proponents of the bill argue that postponing the issue will only make it worse. In a statement, Cook County Board President Toni Preckwinkle’s office wrote: “The county’s proposed reform is an effort to ensure that the county is consistent with federal Safe Harbor guidance, which dictates pension benefits provided to an employee in lieu of Social Security must be comparable to the value of Social Security benefits,” the office said. “Tying the Tier 2 cap to the Social Security Wage Base addresses this risk now before it can become problematic.”

The bill has received a third reading deadline extension through April 28.

AROUND THE STATE 

— Illinois to get $67.6 million through Juul e-cigarette settlement: “E-cigarette company Juul Labs will pay Illinois more than $67.6 million as part of a $462 million multistate settlement over allegations that the company marketed its products to minors,” by the Chicago Tribune.

— Gov. Pritzker Celebrates Fermilab’s New Integrated Engineering Research Center at Ribbon-Cutting Ceremony: “Governor JB Pritzker joined government officials and stakeholders at a ribbon-cutting ceremony celebrating the completion of Fermilab’s new Integrated Engineering Research Center and PIP-II cryoplant building,” from the Office of Mayor Lightfoot.

— Make reliability a priority of the energy transition, regulator tells lawmakers: “Officials from an organization tasked by the federal government with ensuring the reliability of the energy grid are cautioning Illinois lawmakers to ensure the state has enough energy liability to handle the changes coming to electricity providers. Leaders from Reliability First, a Cleveland-based organization that oversees energy reliability standards in the North American Electric Reliability Corporation territory that includes Northern Illinois, spoke to the Senate Energy and Environment Committee on Thursday about the importance of ensuring the state has a reliable energy grid during the transition from dirty energy sources like natural gas and coal to clean energy,” by The Daily Line.

CHICAGO

Chicago Secures Two More Rating Upgrades for the City’s Water and Sewer Credits

Mayor Lori Lightfoot announced Wednesday that S&P Global Ratings had upgraded the City of Chicago water and sewer revenue credits. Both the Water Second Lien Revenue Bonds and the Sewer Second Lien Revenue Bonds were each raised by one-notch, from ‘A’ to ‘A+.’

According to S&P Global, the rationale for the upgrades includes:

• Modernization of the bond indentures (contracts) and adoption of new cash reserve policies to improve liquidity;
• Robust financial projections to demonstrate the City’s leverage metrics and debt service coverage — enabling support of the Capital Improvement Plan (CIP);
• Conversion of the current uniform water rate to the American Water Works Association (AWWA) M1 Cost-of-Service rate methodology for all its suburban wholesale customers, who are charged only for the infrastructure they actually use;
• Proactive actions to make system improvements and begin lead service line replacements; and
• A new pension advance policy.

“These upgrades reaffirm our long-term effort and hard work, which have resulted in fiscal stability for Chicago and our system partners,” said Mayor Lori Lightfoot. “The ratings not only prove the excellence of our City’s operational and financial management, but confirm that we have been making the right decisions, all along, to attract additional investment, boost economic vitality, and further strengthen our City’s finances.”

MORE FROM CITY HALL 

— South Siders slam Walmart over plan to close stores, threaten protests at other Walmarts: “The retail giant announced this week it would close that location, at 8431 S. Stewart Ave., along with smaller stores in Kenwood, Little Village and Lakeview. Sunday will be the last day for all four locations. The announcement Tuesday sparked outcry around the city, particularly for the Chatham area, where the Walmart has become a hub for everything from appliances and toys to prescriptions and health appointments,” by the Chicago Sun-Times.

— Lori Lightfoot and Kim Foxx clashed in texts mayor’s office partially withheld from public: ‘Lori, you were wrong:’ “While campaigning for reelection in January, Chicago Mayor Lori Lightfoot criticized Cook County State’s Attorney Kim Foxx for ‘handing out certificates of innocence like they’re candy,’” by the Chicago Tribune.

— Northeastern Illinois University faculty and staff could be next in line to strike: “Union-represented faculty and staff at Northeastern Illinois University in Chicago could be the latest to walk the picket lines after 95% of members voted Thursday to strike if an agreement with the administration is not reached at upcoming bargaining sessions,” by the Chicago Tribune.

— Hearing on municipal sidewalk snow plow program delayed, sponsor says they’ll wait for new administration to call the ordinance again: “Aldermen were initially scheduled to hold a hearing on a proposal to create a municipal sidewalk snow plowing pilot program, but the ordinance’s lead sponsor said they will wait until Mayor-elect Brandon Johnson takes office in May to move forward with the proposal,” by The Daily Line.

— Health committee approves measures calling for annual reports on homelessness, codifying gender-based violence task force: “The City Council Committee on Health and Human Relations approved a measure calling for annual reports on efforts to combat homelessness and codification of a citywide task force to address gender-based violence. On Thursday, the health committee approved an ordinance (O2023-1011) that calls for annual reports on housing and efforts to address homelessness,” by The Daily Line.

FEDERAL

Beltway Briefing: From a New York Courtroom to the Taiwan Strait

Public Strategies’ Howard Schweitzer, Rodney Davis, and Patrick Martin ponder the legal and political implications of the former President’s arraignment. And, as tensions mount between Washington and Beijing, they also discuss the ramifications of the meeting in California on Wednesday between House Speaker McCarthy and Taiwanese President Tsai.

Listen to the full Beltway Briefing here.

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