RAHM SINGS SAME SONG ON PENSIONS ...
Mayor accuses state Supreme Court of throwing ‘ wet blanket’ on reform effort
Mayor Rahm Emanuel on Wednesday accused the Illinois Supreme Court of throwing a “wet blanket” on pension reform talks with police and fire unions and said he’s hoping for a statewide solution to the problem that might include a sales tax on services.
In a meeting with the Chicago Sun- Times editorial board, Emanuel explained why he ignored the elephant in the room — a state- mandated, $ 550 million payment to shore up police and fire pensions— in a pre- election budget that bolsters
services with higher taxes on parking, car leasing and cable television.
Emanuel said he’s determined to “hold to the principle that reform and revenue go together,” just as he did in crafting a deal that saved the Municipal Employees and Laborers pension funds, with a telephone tax hike covering the first year of the city’s increased obligations.
But he argued that the Illinois Supreme Court made that impossible when it ruled in July that subsidized health care premiums for state employees are protected under the state Constitution and cannot be “diminished or impaired.”
Until the Supreme Court decides the fate of a state pension reform bill, police and fire talks are on hold, the mayor said.
“The Supreme Court . . . has thrown a wet blanket on further discussions,” Emanuel said. “Can you imagine somebody . . . on the other side saying ‘ Let’s work out an agreement’ while the question of what we work out is in legal limbo?”
When the “wet blanket” is lifted, the mayor said, he’s hoping for a statewide revenue solution to the problem of police and fire pensions.
That might include a return to an idea Emanuel floated, then abandoned during his first mayoral campaign after it was derisively branded the “Rahm tax”: broadening the sales tax umbrella to an array of services not now covered.
“You can lower the rate [ and broaden the base]. We tax the consumer — a single mother buying school supplies — where other people who may join clubs don’t get taxed,” Emanuel said.
For now, the mayor’s preelection budget counts on raising $ 54.5 million through “targeted” tax hikes and closing “loopholes,” which amounts to the same thing.
The budget also includes $ 33.1 million in election- year sweeteners for voters — in the form of enhanced early childhood education and increased pothole patching, rodent control, tree- trimming and graffiti removal.
The targeted tax hikes would have been greater if the City Council hadn’t already done the heavy lifting — before gearing up for re- election.
In late July, aldermen approved a 56 percent increase in the monthly surcharge tacked on to telephone bills to meet the city’s obligations to the Municipal Employees and Laborers pension funds.
That allowed the mayor to cancel his plan to raise property taxes by $ 250 million over five years.
Emanuel has refused to say how the city would meet those rising obligations going forward, when the telephone surcharge will fall short. But he has said he firmly believes he can do it without raising property taxes. Ald. Bob Fioretti ( 2nd), Emanuel’s highestprofile mayoral challenger, accused the mayor of postponing Chicago’s day of reckoning to get past the mayoral election.
“Election- year froth regarding potholes and graffiti removal while kicking the real costs down the road. No solutions to long- term debt. No TIF reform. And sticking the bill to our retirees,” said Fioretti ( 2nd), who favors a tax on La Salle Street exchanges and a commuter tax to solve the city’s pension problems.