DeKALB – Republican gubernatorial candidate Bruce Rauner touted alternatives to solve the state’s long-term economic problems as he campaigned in DeKalb County on Wednesday.
Rauner, a venture capitalist from Winnetka who hopes to unseat Gov. Pat Quinn in November, criticized the changes to the state’s pension system that lawmakers approved in December, cronyism, and education funding shortfalls. He addressed local Republicans at Hopkins Park in DeKalb and later visited the Daily Chronicle newsroom.
While local Republicans said they’re waiting for details from Rauner, they’re enthused about the broad shifts he’s promised for the state.
“His approach to being governor will be different and has caught the attention of those who want to see change in Springfield,” said DeKalb County Republican Party Chairman Steve Kuhn.
Changes proposed to Illinois’ pension system would cut cost-of-living increases and cap the amount of earnings that can be used toward retirement benefits.
Although the law is on hold pending a court ruling on its constitutionality, the Illinois Supreme court has already declared the part of the law that would have required retirees to contribute to their health care unconstitutional. Rauner said he believes the Illinois Supreme Court eventually will declare the entire law unconstitutional.
“We need to protect our existing pension system,” Rauner said. “Our retirees deserve to get what they were promised.”
As an alternative, Rauner suggested freezing pensions and accruals at current levels for active employees while creating a second pension system that would apply to new employees. The latter, Rauner said, should be a defined contribution plan similar to the 401(k) plans common for private sector workers.
“That’s fair, I think, to government workers,” Rauner said. “It’s fair to the taxpayers, more affordable in the long run.”
But Bill Godfrey, a DeKalb County Tea Party board member, doesn’t think pension reform should be among Rauner’s top priorities. Godfrey was among local Republicans who listened to Rauner speak Wednesday at Hopkins Park.
“I think rather than going into the pension issue, he should attack the budget and make cuts that some people – maybe even him – might not like,” Godfrey said.
At Northern Illinois University, officials have partially blamed a decade of reductions in state funding for issues with student retention. With less money coming in from the state, the university has raised tuition, which in turn has made college more expensive for students.
NIU has seen enrollment declines in each of the past four school years.
Rauner decried what he said has been a state leadership that hasn’t focused on education. Rather than cutting education spending, the state should boost it, he said, to make the state more competitive.
“We should fund our K-to-12 education first and foremost, but we should also fully support our state university system,” Rauner said. “It’s one of the most important economic growth engines for our state.”
Maintaining Illinois’ 5 percent personal income tax rate should not be a means to increase spending, Rauner said.
“I believe we need to reduce the overall tax burden on working families in Illinois and grow our way out of our challenges by becoming more pro-growth, more pro-business in the state,” Rauner said.
Quinn has openly advocated for extending the 2011 measure that increased Illinois’ income tax rate from 3 to 5 percent, and lawmakers plan to revisit the issue after the November election. The rate is set to drop from 5 to 3.75 percent on Jan. 1, but Quinn has said without an extension or other revenue the state will face a $4.4 billion budget hole.
Making state business-friendly
To promote business growth, Rauner said the state must alleviate regulatory and tax burdens on Illinois businesses. He criticized the state’s workers compensation, environmental restrictions and tort systems as hostile to business and the driving forces behind the state’s 7.9 percent unemployment rate.
Rauner also added some detail to his plan to reduce $1 billion from the state’s $35.7 billion budget.
He said if elected governor, he would roll out a 4-year plan to restructure state government. Specifically, he said those savings would come from restructuring the pension system, Medicaid and the Central Management Services division and closing tax loopholes for corporations.
He also has been a proponent of imposing 8-year term limits for elected officials to end what he called massive scale corruption and cronyism.
Kuhn and Godfrey agreed that they’d like to see more details on how Rauner would fix state spending, but believed those details would come to light as the campaign progressed, or if Rauner wins the election.
Despite the missing pieces, both felt Rauner would be the right Republican to lead a largely Democratic-run state.
“I think he’s going to have some challenges, that’s for sure,” Kuhn said. “But I’m not going to second-guess him. I think the specifics we’ll get when he gets there.”