Budget battle heats up at Cook Co. Board
Wednesday, September 17, 2008
CHICAGO (WLS) -- Just months after raising the county's sales tax significantly, the Cook County Board approved a nearly $4 billion bond issue that includes borrowing millions to keep the county operating.
Critics call Cook County Board President Todd Stroger's plan irresponsible. He wants to borrow $740 million and refinance more than $3 billion in debt.
The bond battle at the Cook County Board features President Todd Stroger claiming he can save taxpayer dollars by refinancing several billion dollars of existing debt and that he needs a few hundred million additional in bond sales to pay for obligations the board has already approved. But the opposition says it is dead wrong to float a giant bond issue now with Wall Street in chaos and to give Stroger power over so many dollars without enough checks and balances, especially after that giant sales tax increase earlier this year.
"I think it is unprecedented. It's fiscal abuse. It is adding debt burden of the county and taxpayers at a very unstable economic time," said Commissioner Forrest Claypool, (D) Chicago.
"This is a very risky situation. This board is giving away its authority to have oversight on what will be the most significant financial transaction in the history of the county," said Larry Suffredin, (D) Chicago.
The opposition bloc on the Cook County Board claims it is wrong in every possible way for president Todd Stroger to float a $3.8 billion bond issue without giving them enough details about who is handling the transactions, enough controls over how the money is spent, and enough oversight, especially after Stroger's allies on the board more than doubled the county's sales tax earlier this year to raise more than $400 million.
"This could not happen at a more damaging or worse time," said Tony Peraica (R) River Forest.
The opposition is also questioning the very idea of a giant bond deal at a time when some of the country's largest financial institutions are going under and wall street is in chaos.
"Folks, things are going to get worse and when they get worse and the markets crash in such a manner, so do the sources of our county's income," said Michael Quigley, (D) Chicago.
"Speaking of fiscal prudence, we must as a board take politics out of this," said Donna Dunnings, Chief Financial Officer.
But Stroger and his allies say the bond deal is necessary to repair county facilities like the jails and the hospitals, pay into the pension funds, settle lawsuits, cover operating shortages, and refinance the county's existing debt at lower interest rates, which will actually save the taxpayers some money.
"These are common practices of government entities and allow us to address other expenses. The Cook County Board of Commissioners has already approved these obligations and has a responsibility to fund these expenditures." said Todd Stroger, Cook County Board President.
The meeting lasted more than five hours and before the showdown vote, which turned out 12-4 in favor of the bond deal, Stroger and his allies made two major concessions to make the process more transparent and give the board more control over where the money goes.
The concessions weren't enough to satisfy the opposition bloc. They still voted no. But it was enough to win over enough undecided commissioners to get the deal approved.