Junk status, lost lottery and failing infrastructure loom, attorney contends
Illinois is looking at a triple threat of troubles if it can't pass a state budget, according to Eugene Keefe, a partner with the Chicago law firm of Keefe, Campbell, Biery & Associates.
In his blog on the firm's website, Keefe describes the three so-called "FAIL" issues.
First, Illinois' credit rating would drop to “junk status,” he writes, which is unprecedented in the country and would force the state to borrow at an excessive interest rate -- if it can borrow at all. Illinois is currently more than $15 billion in regular debt, and its pension debt is at more than $130 million.
Second, the state’s infrastructure would suffer, as jobs would be cut but maintenance needs would remain. Laid-off workers would have to file for unemployment, which would put more of a drain on state funds.
Finally, the Illinois Lottery would suspend Powerball and Mega Millions games because the state would not have the authority to pay the winners. Losing the games would cost the state millions.
But the troubles don't end there, Keefe contends. A failed budget deal would continue the trend of a lack of accountability by lawmakers. Keefe describes a “benefit-ocracy” whereby state government provides its workers with benefits and jobs at taxpayers’ expense.
Keefe also said that if the legislators can compromise, they must take into account the Illinois’ General Assembly Retirement System (GARS), which he describes as a “scam.”
“This fake retirement system allows a member of the Illinois House or Senate to contribute as little as about $30,000 in four years of part-time work to then get literally millions of dollars from Illinois taxpayers the rest of their lives,” Keefe writes.
Keefe is also opposed to raising taxes.
“I don’t feel Illinois State Government can tax its way out of these issues,” Keefe writes. “Illinois taxpayers need more than higher and higher taxes and lots of new taxes without something in return.”
Keefe suggests ways to save tax dollars, including consolidating state agencies and cutting director positions; eliminating either the Office of the Illinois Treasurer or the Office of the Illinois Comptroller, which Keefe argues duplicate efforts; automating all state tollways; eliminating the lieutenant governor position; and closing state government's remote offices.
Keefe also points out the possibility of further job loss, citing companies that have left Illinois recently, ostensibily because of the high taxes, or those that have shut down because of them.
“When employers and jobs leave because of rising and new taxes, they may never, ever come back,” Keefe writes. “In my view, if we continue to run this hillbilly, dysfunctional State Government, we will lose more jobs and workers.”
Organizations in this Story
118 North Clinton Street
Chicago, IL 60661