"Desperate" Budget Situation In Cook County | Progress Illinois

Cook County government is $487 million in the red, and its soon-to-be inaugurated president Toni Preckwinkle says every county department must find 21 percent in savings over the last three quarters of the county's next fiscal year to close the gap.

A somber Preckwinkle laid out the situation before reporters a day after she voted to support outgoing Chicago Mayor Richard Daley's last budget, which leans heavily on one-time reserve funds, "surplus" tax increment financing (TIF) dollars, relatively rosy budget projections, and furlough days that the city's unionized workforce have not to agreed to take.

Preckwinkle told reporters she had addressed the county's separate elected officials -- from the assessor to the state's attorney -- about finding the savings at a meeting Wednesday. "No one would be absolved from making cuts, and no one would be alone from making cuts," is how Preckwinkle described her message at the gathering. Here she is outlining the broad strokes of the budget:

The "desperate" situation, as Preckwinkle called it during the press conference, is due in large part to the county board's reversal on the penny-on-the-dollar sales tax increase that was the hallmark of lame duck County President Todd Stroger's scandal-tarred administration. A majority of the deficit, $264 million, comes from a partial repeal of the sales tax hike. The County Board first approved the sales tax hike in 2008 and then rolled back half of it in the summer of 2009, overriding Stroger's veto.

The rest of the deficit, $233 million, stems from obligations Preckwinkle expects the county will owe its unionized workers at the conclusion of upcoming contract negotiations as well as $45 million to settle a class action lawsuit with 250,000 Cook County Jail inmates who were subject to degrading strip searches. (An additional $10 million of the settlement is covered by insurance.)

In discussing ways the county could close the gap, Preckwinkle said she will cut her own salary by 10 percent, consolidate services within the Bureau of Economic Development and the Bureau of Administration, restructure the county's debt, and end procurement and capital spending on "non-strategic projects and non-core services." She cited savings found by other governments crunched by budget shortfalls.

"The New York Metropolitan Transit Authority in six months achieved more than $150 million in recurring saving in rapid and sustained cost-reduction measures. These benefits were driven by renegotiating contracts with vendors, identifying significant reductions from existing contracts, and rationalizing the total number of suppliers," she said, "all without negatively impacting service."

Asked if the shortfall could be filled without "significant layoffs," Preckwinkle did not answer directly. She did acknowledge that she has met with many of the city's largest unions and warned them that it was going to be "an extraordinarily difficult year."

Further complicating where cuts may fall are court orders and consent decrees that govern how places like the county jail and juvenile detention center are operated.

County commissioner John Daley emphasized that other county elected officials needed to come to the table to help close the shortfall, especially since none of them spoke out during the county board's stormy debates about the partial roll-back of the sales take hike.

"I look back when the sales tax was reduced," said Daley, the county board's finance committee chair. "I didn't hear from one elected official who opposed the reduction in the sales tax. When the president vetoed it again, I didn't hear one elected official."

He said public safety operations eat up about 60 percent of sales tax revenue, with health care getting the majority of the remainder, about 35 percent.

Preckwinkle was asked yesterday if she thinks county government should cap its expenditures on health care at $100 million below the current level. Preckwinkle said the Bureau of Health Services' current proposed subsidy is about $217 million, down from last year's $279 million.

Rising health care costs are, of course, primarily responsible for the much-discussed and overwrought debate about the federal deficit. Finding ways to deliver health care more efficiently for the 5 million people who need services annually certainly would help the county's bottom line, too.

The Bureau of Health Services is already on a new track, shifting to an outpatient system and assuming the national health care reform will "result in fewer uninsured and underinsured individuals in Cook County" which "should provide more County health care dollars overall for the care of the medically indigent," according to the system's recent strategic plan.

The takeaway here is that the fate and successful implementation of national health care reform in Illinois will play an important part in solving the county's budget woes going forward.

We'll also be watching to see if the Preckwinkle administration and Cook County Sheriff Tom Dart can realize major savings by expanding jail diversion programs. With the budget hole as deep as it is, smart reforms about how inmates are dealt with at the jail could prove to be both a progressive policy move and an essential way to help close the budget gap without cutting needed services.

via progressillinois.com

Posted via email from Brian's posterous