QUOTE OF THE DAY
Crain’s Chicago: Emanuel’s pension fix costly, but pain is likely to double
The $250 million annual property tax increase that Mayor Rahm Emanuel wants to shore up two of Chicago’s dangerously underfunded pension funds could almost double if he reaches similar deals to restructure other equally troubled retirement plans, according to a Crain’s estimate.
Mr. Emanuel’s proposal for the plans covering municipal workers and laborers restructures about half of the city’s $19.5 billion unfunded pension liabilities, with police and fire funds accounting for the rest. If he reaches deals to overhaul those funds similar to the March 31 proposal, and funds the city’s share the same way, property taxes could increase another $200 million or more, according to Crain’s rough calculations. Meanwhile, a crisis of about the same magnitude is looming over the Chicago Board of Education.
Uncertainty about the total cost to stabilize Chicago’s woefully underfunded pension plans has troubled some members of the Illinois General Assembly, which on April 3 delayed a vote on the pension deal. It also is starting to worry downtown office building owners and their tenants, who would feel the brunt of the tax increases.
Points and Figures: Big Day In Chicago Startup Scene
The company was started in 2006 out of the New Venture Challenge at the Chicago Booth Polsky Center. The found local seed investors led by Origin Ventures. Their series B round had two Chicago VC’s and one San Francisco based VC. It wasn’t until the third round that Silicon Valley VCs got interested. They managed to raise $84M in capital. What a huge achievement!
They used the capital to successfully execute their business. It’s important to note, raising capital is arduous-especially in the Midwest-and it was really hard back in 2006. Execution of the business once you get the money is harder. GrubHub based their operations in Chicago. It was a great place to incubate their business.
This shows the world a lot of things. First, the University of Chicago has a damn good business school when it comes to entrepreneurship. It’s always been famous for finance and economics. The New Venture Challenge winners in 2006 IPO’ed. The 2007 winner, Braintree, was sold to PayPal for $800M. Other NVC companies have exited too.
Chicago Tribune: Plastic bag ban? Not so fast, aldermen say
Although some Chicago aldermen hope to approve a plastic bag ban by the end of the month, a majority of the City Council is saying, “Not so fast.”
Ald. George Cardenas, 12th, has called for an April 15 vote at the Health and Environmental Protection Committee that he runs. Approval there would pave the way for an April 30 vote of the full City Council.
But 28 aldermen have signed a letter requesting “additional time to study the impacts of such a ban on Chicago’s retailers, consumers and workforce.”
Chicago Tribune: Illinois’ slow foreclosure pace traps neighborhoods in blight
Thought the foreclosure crisis was over? In many states, it is. Not in Illinois.
During 2013, this state ranked No. 3 in foreclosures behind Florida and California, according to research firm RealtyTrac. The shame of it is that Illinois would be better off — as would its citizens yearning to buy empty homes — if the state completed more foreclosures. As is, a backlog of distressed and abandoned properties drags down neighborhoods that can least afford vacancies and blight.
The key for recovery: Get these eyesores on the market, so buyers can fix ’em up or tear ’em down.
Daily Herald: Union says other college teams in play
Players from other universities have expressed interest in forming unions in the wake of the landmark decision last week involving the Northwestern football team, a union organizer said Friday.
Tim Waters of the United Steelworkers would not disclose the players or their schools, saying it was too early to reveal who they are. But he said they reached out following the decision last week by a regional director of the National Labor Relations Board declaring Northwestern’s football players have the right to form a union.
“We’re not giving out who it is or who they are, but the answer is yes,” said Waters. “There’s a lot of excitement out there. We’ve been contacted by a number of players.”
BND: Illinois lawmakers erode local control
Mention firefighter staffing levels and contract negotiations, and most people’s eyes glaze over. And that’s exactly what the people who are pushing to fast track HB 5485 through the state legislature are counting on.
Opponents — and there are many, including the Illinois Municipal League — say the bill would take away local control over how to staff fire departments and instead make it subject to collective bargaining. So if a city got into a budget squeeze, it couldn’t reduce minimum staffing at firehouses without the union’s agreement. An arbitrator could order a city to have a minimum number of firefighters per shift, even if the city couldn’t afford it. A city would either have to raise taxes or make disproportionate cuts in other areas.
The Illinois Association of Firefighters said that this bill doesn’t change the law, it simply clarifies it. But it’s unlikely there would be such a hard push to get this approved if that’s all the bill did.
The headlines on Friday’s labor report for March focused on the 192,00 net new jobs and the unemployment rate that remained 6.7%. But another statistic worth noting is theemployment rate, or the share of Americans who are working, which has been signaling deeper and long-term problems for the U.S. workforce.
The employment rate, or the employment-to-population ratio, measures the share of all potential workers who have a job. This measure stood at 62.2% on average in 2007, plunged to 59.4% in 2009 and still stands at a very low 58.9%.
The jobless rate has fallen to 6.7% from 10% in October 2009, and with this report the private economy for the first time has regained all the jobs lost to the financial panic. But the unemployment rate can underestimate the jobs problem because people who stop looking for work no longer count as “unemployed” in the official tables.
CARTOON OF THE DAY
