Political Rewind: Drought Lingers, Pension Reform in Limbo

• Editor's Note: This article was created by aggregating news articles from Illinois Watchdog, formerly Illinois Statehouse News.

IL: Drought Lingers, Pension Reform in Limbo

SPRINGFIELD — A severe drought devastating crops throughout Illinois prompted concerns about the potential costs of disaster aid and crop insurance payouts later this year.

And House lawmakers will take up pension reform when they return to the Capitol for a special session Aug. 17. Here is the week in review:

Taxpayers on the hook for millions in crop insurance payouts

An environmental watchdog says taxpayers nationwide, including Illinois, will be on the hook for millions, if not billions, of dollars in crop insurance for grain farmers hit hard by this summer’s devastating drought.

Government aid, mostly in the form of low-interest loans, will not provide much help for farmers suffering through the drought because of the slow, creeping nature of the disaster. Taxpayers foot much of the bill for crop insurance premiums, overhead costs for the insurers and more. About 80 percent of Illinois farmers have crop insurance.

“And when losses get really big, like they’re likely to be this year because of this horrible drought, taxpayers are going to end up on the hook for the vast majority — over 90 percent — of the loss,” said Craig Cox, senior vice president of the Environmental Working Group, which tracks farm subsidies.

But safety nets, like crop insurance, help eliminate some of the risk for grain farmers, said John Hawkins, spokesman for the Illinois Farm Bureau.

“If we have another year like this, you’d probably have a lot of people just get out of the business. People wouldn’t be very eager to enter (farming) either, because of the investment and time,” Hawkins said. “Whenever you have a disaster like this you’re always glad there is crop insurance or some kind of cushion there that farmers can depend on to get them through the short times, so that when we have normal crops we’ll still be there.”

It could be a record year for insurance payouts because of the drought, which stretches across much of the country. Estimates run from nearly $20 billion by the U.S. Department of Agriculture to $40 billion by the Iowa Farm Bureau. No one will know, until the harvest is in and the insurance companies make their payments.

House lawmakers may take up pension reform in August

State House lawmakers may vote on a pension-reform measure when they convene for a special session Aug. 17 here.

The House will meet to consider expelling indicted state Rep. Derrick Smith, D-Chicago. But Speaker Michael Madigan, D-Chicago, also could call a vote on pension reform.

We Are One Illinois, a consortium of unions representing state workers, issued a statement this week, saying Madigan told the coalition that he is considering calling the matter for a vote — but only regarding pensions for lawmakers and state workers. Teacher pension reform would not be included.

“We have no certain knowledge of (Madigan’s) intent,” the statement read. “We reiterated to him today our willingness to work with the legislative leaders to develop a fair pension solution.”

The state Senate approved a pension bill in May with bipartisan support. That bill allows state employees to retain compounded cost-of-living adjustments to their pensions, if they give up state-sponsored health insurance and have future pay raises count toward their pension. Workers who accept lower cost-of-living adjustments would keep their insurance and have their raises count toward their pension.

The House’s attempt to pass pension reform faltered in the final hours of the legislative session over a plan to shift pension costs from the state to local school districts. Legislative leaders have been meeting regularly in Chicago since to hammer out their difference about the reform.

Ronald Holmes, spokesman for Senate President John Cullerton, D-Chicago, said the Senate has no plan to convene Aug. 17 because the pension-reform bill they passed is in the House’s hands.

“We’ve done this, and now we’re encouraging the House to do the same,” he said. “At the same time, we can continue trying to figure out how to solve this cost-shift issue. This is real savings that we’re talking about here.”

Quinn spokeswoman Brooke Anderson said Gov. Pat Quinn wants lawmakers to take up pension-reform as soon as possible.

“The governor will continue to push until we resolve this and restore fiscal stability to Illinois,” she said.

Feds subpoena two state lawmakers

Federal investigators have subpoenaed records for at least two state lawmakers, according to news reports this week.

A July 18 subpoena requested records of state Rep. Connie Howard, D-Chicago, who resigned from her lawmaker post on July 9 The subpoena requests records to and from the “Constance A. ‘Connie’ Howard Technology Scholarship Fund.”

Investigators also want notes, meeting minutes, transcripts and reports issued by the state House Computer Technology Committee from 2000 through 2007. Howard was chairwoman of the committee some of those years, according to reports.

A 2010 subpoena, obtained by the Chicago Tribune, showed investigators sought financial records from Howard’s 34th District, including vouchers, employee time sheets and communication between 2006 and 2009.

Investigators also are looking at college tuition waivers awarded by state Rep. Dan Burke, D-Chicago, according to the Tribune. A Chicago grand jury on March 21 subpoenaed information about Burke’s “procedures for the establishment, awarding and operation of the Illinois General Assembly Scholarship,” as well as records “pertaining to receipt of any funds or gift in connection with the award of the scholarship, including the identity of any person/entity giving any funds or gift, the amount or gift received, and the date received.”

In addition, federal investigators last month subpoenaed the scholarship records of state Sen. Annazette Collins, D-Chicago.

— Jayette Bolinski