Rauner predicts CPS takeover plan will get downstate support
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- Published on 04 February 2016
By Mark Fitton
Illinois News Network
SPRINGFIELD — When the time comes, suburban and downstate Democrats will join him in his effort to have the state take control of Chicago’s debt-strapped school system, Gov. Bruce Rauner said Wednesday.
It was the Republican governor’s second day in a row promoting the state takeover plan, despite nearly outright dismissal from city, school system, teachers’ union and Democratic legislative leaders.
Still, Rauner insists that when the true costs of keeping CPS afloat without state intervention becomes clear, citizens will pressure state lawmakers to intervene on their behalf rather than see their taxes go up.
“You watch,” Rauner said at Chicago event Wednesday. “Watch Democratic legislators from around the state who are not from Chicago like the (House) speaker and the (Senate) president. You’re going to see that bill is not dead-on-arrival, as some people say.”
“We cannot allow the mayor and some of his friends inside the Legislature to come up with a structure to force liabilities onto other taxpayers,” Rauner said. “We cannot allow a transfer of those liabilities outside the city of Chicago.”
A day earlier, Senate President John Cullerton, D-Chicago, dismissed the Republican plan in three short sentences:
"I thought we’d already addressed this,” Cullerton said. “The law doesn't allow him to do that. So it’s not going to happen.”
Already deeply in debt and with a bond rating at junk status, CPS on Wednesday sold $725 million in bonds at a high interest rate (8.5 percent, according to the Chicago Tribune). It’s also recently courted as much as $500 million in assistance from the state, which itself is deeply in debt and still spending in the red.
Additionally, the city is reportedly considering seeking $200 million more in property taxes to bolster its school system, and that would come on the heels of a $588 million property tax hike passed just a few months ago.
CPS also is staring at a possible strike, as the Chicago Teacher’s Union this week rejected a contract offer and effectively started a countdown that could allow teachers to walk out in May, should they choose.
Rauner tore into Chicago and CPS leadership on Wednesday, saying “the numbers don’t lie” and “CPS has been a disaster for years.”
“Now they’re looking to borrow more money to cover operations,” the governor said. “Borrowing to cover operations is basically taxing delayed. This is kicking the can, not solving the problem.”
Rauner also rebutted the accusation his remarks on Chicago schools this week were intended to complicate Chicago’s already difficult bond sale. “That’s ridiculous,” he said. “I believe that’s City Hall flailing and floundering and failing and looking to blame others for it.”
The GOP’s plan, which would include changing state law to allow CPS to file for Chapter 9 bankruptcy, has been met by union, city and Democratic reaction with language on par with Rauner’s criticisms.
Forrest Claypool, CEO of Chicago Public Schools, has called it a sideshow intended to deflect attention from the state’s own heavy debt, lack of a state budget and stalled contract negotiations.
Chicago Teachers Union President Karen Lewis has called Rauner’s remarks “the ravings of a madman.”
Cullerton has called the plan mean-spirited, far-fetched and ridiculous.
But Rauner says CPS — and in the end, taxpayers — are looking at two options: “completely unaffordable tax rates that would devastate the city” or bankruptcy.
“If we don’t change the structure of Chicago and the structure of Illinois, taxpayers, homeowners (and) small-business owners in this city and in this state are looking at crushing tax increases,” the governor said Wednesday. “We’re just seeing the tip of the iceberg.”
“The critical issue is we get a broad restructuring of the state and we get reform so that we can get taxpayers voices with equal weight, rather than government insiders,” Rauner said.
While Rauner says he’s trying to protect the education of Chicago school children and the jobs of Chicago teachers, the teachers’ union opposes the takeover plan, perhaps largely because contracts might be reopened under a Chapter 9 bankruptcy.
CTU has called the proposal “a Flint, Michigan-style emergency management for Chicago Public Schools — a district that overwhelmingly serves low-income African-American and Latino students and families.”
Speaker Michael Madigan, D-Chicago, has used the term “bailout’ to refer to the CPS takeover proposal, although Rauner and other Republicans say their legislation explicitly says Illinois won’t be liable for CPS debts.
And the speaker and governor are hardly on the same page when it comes to Rauner’s agenda and their respective definitions of reforms.
“Don’t bring on ideas that cut the savings and property of middle class families in Illinois,” Madigan spokesman Steve Brown said Tuesday. “Don’t try to hold that out as ‘structural reform’ because it is neither structural nor reform. That’s just taking another whack at middle class families so the 1 Percenters can get further ahead.”
State Rep. Ron Sandack, R-Downers Grover, has said the proposed plan, and possibly a bankruptcy filing for CPS, is simply realistic financial thinking.
“It’s not a bailout to restructure debt,” said Sandack. “It’s not a bailout to look at contacts, try to renegotiate them and make them far more favorable to taxpayers. It’s not a bailout to actually construct a fiscally and financially responsible plan to put the school system …. in a better place than it is.”
'Best Little Whorehouse in Texas' set to open at Peoria Players
- Details
- Published on 02 February 2016
- Written by Paul Gordon
Peoria has a strip bar or two or three and at one time had its share of brothels. So are Peoria community theatre audiences ready to see a whorehouse kickin’ up some dirt?
Chip Joyce is counting on it. He’s directing “The Best Little Whorehouse in Texas,” the popular musical that opens Friday at 7:30 p.m. at Peoria Players Theatre, 4300 N. University St.
“This is a popular title, and yet it’s a show that doesn’t get produced all that often. Ticket sales are going well and we’re in good shape,” Joyce said before one of the show’s final rehearsals.
“People like this show because it’s good, clean adult fun. It is not a raunchy show by any means. It’s a very sweet show that can be rowdy and fun. It’s not threatening or offensive in any way and it doesn’t try to make any big statements, yet it does say a lot about politics and media hypocrisy,” he added.
And the politics and media hypocrisy are based on fact.
“The Best Little Whorehouse in Texas” is based on the real-life Chicken Ranch brothel in LaGrange, Texas. The book was written by Larry L. King and Peter Masterson, with music and lyrics by Carol Hall. It is based on a book written by King.
The story takes place in the late 1970s in fictional Gilbert, Texas, where a brothel has operated for 100 years or more. It’s being run by Miss Mona Stangley, who is on good terms with the law, notably Sheriff Ed Earl Dodd.
However, all good things come to an end. In this case, the brothel gets shut down when a crusading television reporter named Melvin P. Thorpe (based on real-life newsman Marvin Zindler) makes an issue of it to state and local politicians.
Songs in the show include “Girl You’re a Woman,” “Texas Has a Whorehouse In It,” “Sneakin’ Around,” “The Sidestep,” “Good Old Girl” and “Hard Candy Christmas.”
Joyce has assembled a cast of 32 that includes veterans of area community theatre as well as some newcomers to Peoria stages.
Wendi Fleming of Normal is making her Peoria Players debut in the role of Miss Mona Stangley.
John Donlan of Peoria portrays Sheriff Ed Earl Dodd, his first lead role.
Other cast members include Peoria Players newcomer Kevin Wickert as Melvin P. Thorpe, Wendy Blickenstaff as Doatsey May, John Johnson as the governor, and Jamika Russell as Jewel, one of the “girls” of the brothel.
The other girls are Jillian Risinger, Susan Hazzard, Laura Bouxsein, Kelsey Jensen, Jordan Boland, Kelleen Nitsch, Jessica King, Jennifer Morris, Hania Solecka and Jan Crim.
The Aggies football players are portrayed by John Bathke, Matt Edwards, Aaron Elwell, Chris Guidi, Joshua Jones, Rob King, Andy Schoepke and Matt Stubbs.
“I got very lucky with this cast. Again, the popularity of the title brought people out I didn’t expect. Half of this cast I’ve never worked with before,” Joyce said.
The music director is Laura Weaver Hughes and Danny Fisher is the choreographer for the production.
Joyce designed the large and elaborate set, with Marc Wycoff and Bill Barr the chief builders. “I wanted kind of an abstract southern mansion look. It had to be abstract in that so much action in the show takes place on the set, both inside and outside the house.
Show dates are Feb. 5, 6, 11, 12 and 13 at 7:30 p.m. and Feb. 7 and 14 at 2 p.m.
Tickets are 19 for adults and 12 for patrons 20 and younger. They can be ordered online at www.peoriaplayers.org or by calling (309) 688-4473.
Cat announces more restructuring moves; EP plant to close
- Details
- Published on 29 January 2016
- Written by Paul Gordon
Caterpillar Inc. announced Friday it will, as anticipated, close one of its oldest existing buildings in East Peoria as well as place additional employees on indefinite layoff.
Caterpillar announced Building HH in East Peoria will close by the end of 2018, a move the company said earlier was being contemplated. That closure will affect 230 jobs. Also, an additional 120 employees, a combination of office and production workers, will be laid off indefinitely, beginning Feb. 8.
Along with other decisions that are a continuation of its global restructuring and cost cutting program that started last September, the company said it will close five facilities worldwide and reduce 670 jobs. These are part of the plant closings and job reductions announced in September, when Caterpillar said it would cut up to 10,000 jobs and close or consolidate up to 20 facilities by the end of 2018.
These announcements will bring to 14 the number of plants affected and a reduction of more than 5,600 jobs, including 2,100 positions eliminated through early retirement buyouts.
In its statement Friday, made first to employees, the company said these actions “are expected to significantly lower operating costs in the face of challenging marketplace conditions in key regions and industry sectors.”
Further, Caterpillar said, “These decisions enable the company to be more efficient and better utilize its manufacturing assets.”
“Caterpillar recognizes these restructuring actions are painful for its dedicated workforce, their families and the impacted communities. The decisions are difficult; however, it is necessary to have the right capacity in place for the tough market conditions the company is facing,” the statement said.
The investment community on Friday looked favorably on Caterpillar’s decision to continue restructuring. Caterpillar stock was at $62.24 a share at the close of trading on the New York Stock Exchange, a gain of $1.16 from Thursday’s close.
Below is Caterpillar’s announcement:
- The company has finalized a contemplated decision previously announced on November 19, 2015, to consolidate manufacturing on its East Peoria, Illinois, campus. The consolidation includes the manufacturing of components made for equipment used in mining and construction. This decision will impact 230 positions, which is a combination of office and production employees. The company will relocate affected production to other Caterpillar facilities with a portion of the work moving to outside suppliers. As a result, Caterpillar will consolidate various production on its East Peoria manufacturing campus and will eventually close Building HH. This transition will begin in early 2016 and is expected to be complete in late 2018.
- Separate from long-term restructuring actions but in response to continued low demand for mining products, Caterpillar will place approximately 120 employees in office and production roles on the East Peoria campus on indefinite layoff. The reductions in East Peoria will take place over a period of time beginning on February 8.
- Caterpillar will consolidate two engine component manufacturing facilities into its existing Pontiac, Illinois, facility, resulting in the addition of about 160 new jobs in Pontiac. The company will close its fuel systems manufacturing facility in Thomasville, Georgia, and an after-treatment manufacturing facility in Santa Fe, New Mexico. Approximately 200 jobs – a combination of office and production employees as well as agency workers – at the Thomasville facility will be impacted by the closure. Approximately 50 jobs in Santa Fe, which is a combination of office and production employees, will be impacted by the closure. The consolidation is expected to begin this year and be completed within the next 12-18 months.
- The production of large wheel loaders in Tongzhou, Jiangsu province in China will transition to the Caterpillar wheel loader facility in Aurora, Illinois. The Tongzhou facility is expected to close in the second quarter of 2016, impacting 40 positions. Total employment in Aurora is not expected to be impacted at this time as the work will be absorbed into existing operations.
- Caterpillar will close its forest products facility in Prentice, Wisconsin, and move production to existing Caterpillar facilities in LaGrange, Georgia, and Victoria, Texas. The transition, expected to be fully complete by the end of 2016, will impact approximately 220 positions in Prentice. Those positions include office and production employees as well as agency workers. Total employment in LaGrange and Victoria is not expected to be impacted at this time as the work will be absorbed into existing operations. Caterpillar is in negotiations with a third party to purchase the Prentice facility and there is potential that the third party will maintain a portion of the current Prentice facility workforce.
- The company will transfer some remanufacturing work currently being performed in Lafayette, Indiana, to the company’s remanufacturing hub in Corinth, Mississippi. No layoffs are anticipated in Lafayette as a result of this move. Caterpillar facilities in Mississippi plan to add about 45 positions over the next few years as a result of continued global consolidation of its engine remanufacturing business.
- In Texas, the company is contemplating consolidation of its Van Alstyne production warehouse operations into the Denison manufacturing operation. If finalized, the consolidation would begin in the first half of 2016 and be complete by the end of the year. Caterpillar will consolidate leased office space in Denison into its primary manufacturing building. This consolidation will begin immediately and be complete by mid-year 2016. Total employment for both locations is not expected to be impacted a result of these two consolidations.
- Separate from long-term restructuring actions but in response to continued low demand for mining products, Caterpillar will place approximately 10 production employees in Denison on indefinite layoff effective February 2.
Survey shows Super Bowl viewing will increase
- Details
- Published on 01 February 2016
- Written by The Peorian
An estimated 188.9 million football fans, foodies and social butterflies plan to watch the Denver Broncos and Carolina Panthers battle it out for the Super Bowl 50 championship title on February 7, up from the estimated 183.7 million who planned to watch last year, according to the National Retail Federation
And, according to NRF’s Super Bowl Spending Survey conducted by Prosper Insights and Analytics, those celebrating will spend slightly more than they did for the 2015 Super Bowl; viewers and partygoers will spend an average of $82.19 on food, décor, team apparel and more, up from $77.88 last year and the highest in the survey’s history. Total spending is expected to top $15.5 billion.
“Two great teams going head-to-head and a historic game celebrating the 50th Super Bowl could make this one of the most-celebrated football games we’ve seen in some time,” said NRF President and CEO Matthew Shay. “We expect retailers will be aggressive with promotions on food and decorations as well as athletic wear and electronics in the coming days as they look to entice those planning to watch the Super Bowl.”
“The excitement around the Super Bowl this year should help retailers and restaurants kick off 2016 on a positive track,” he said.
Of those watching the game, a few key highlights include:
- Nearly eight in 10 (78.6%) Americans say they view the commercials during the Super Bowl as entertainment, while 17.5 percent say they make them aware of advertisers’ brands, and 10.3 percent said they influence them to buy products from the advertisers.
“The Super Bowl has become much more than something only football fans dream about for the entirety of the season,” said Prosper’s Principal Analyst Pam Goodfellow. “The growth in celebrations this year could be a result of increased interest among individuals who use sites like Twitter and Pinterest to bring out their creative skills when it comes to DIY party projects and even making festive game-day fare. Super Bowl Sunday is now more than just a game, it’s an experience for all.”
Specific demographic highlights include:
- Three in 10 (29.9%) of 25-34 year olds will host a party, more than any other age group.
No surprises in Cat year-end financial report
- Details
- Published on 28 January 2016
- Written by Paul Gordon
Caterpillar Inc. ended 2015 about where it expected, with lower sales and profits reflective of the global economy and weakness in the markets it serves, and it expects 2016 to be similar, the company announced Thursday.
Caterpillar had $11 billion in sales and revenues in the fourth quarter and, because of higher-than-expected restructuring costs, posted a loss of $87 million, or 15 cents a share, in the last three months. It was the first quarterly loss posted by Caterpillar since the first quarter of 2009. In the fourth quarter of 2014 Caterpillar has sales and revenues of $14.2 billion and a profit of $757 million, or $1.23 a share.
Without the restructuring costs, Caterpillar would have posted a fourth-quarter profit of 74 cents a share, the company’s report said.
For the year Caterpillar had sales and revenues of $47.01 billion, a 15 percent decline from 2014 sales and revenues of $55.2 billion. The profit in 2015 was $2.1 billion, or $3.50 a share, compared with $3.7 billion, or $5.88 a share in 2014. The profit was off 43 percent because of the restructuring costs. Without those costs the decline was 27 percent, from $6.38 a share in 2014 to $4.64 in 2015.
Among the culprits for the struggle in 2015 was that oil prices have dropped low enough because of ample supplies around the world that nobody is exploring or drilling to find more. Machine orders in the Energy and Transportation Division were down nearly 90 percent. Also, a stronger U.S. dollar, weaker construction equipment sales and lower than expected mining-related sales were negative factors.
Sales and revenues were down in every product segment and in every geographic region in the fourth quarter compared with the same period in 2014, the report said.
One result of a year that was down by Caterpillar standards already was confirmed on Thursday, when the company informed its employees that merit increases for 2016 are canceled.
Despite the declines, the company was upbeat about the fact it was showing a profit and strong cash position in a cyclical downturn.
“Cost management, restructuring actions and operational execution are helping the company while sales and revenues remain under pressure from weak commodity prices and slowing economic growth in developing countries,” said Chairman and CEO Doug Oberhelman.
“We took tough but necessary restructuring actions in 2015 – and they were significant. I am proud that our team stayed focused on our customers in this difficult environment. Our balance sheet is strong; our product quality remained at high levels; we gained market position for machines for the fifth year in a row; inventory levels have declined and are well positioned as we look forward to 2016; and our safety levels are world class. We are benefiting now and expect to even more in the future when markets rebound,” he said.
Still, the company predicted 2016 will be one of continued declines in sales and profits. It expects sales and revenues to be between $40 billion and $44 billion and profit to be about $3.50 a share. And that is including projected savings of $425 million from a change in accounting principles for pension and other post-employment benefit costs and a reduction in restructuring costs from $908 million in 2015 to a projected $400 million in 2016.
Yet that profit forecast is higher than what Wall Street analysts who cover Caterpillar were expecting and because of that some considered the outlook to be at least somewhat upbeat. For that reason Caterpillar stock was valued at $61.08 a share at the close of trading on the New York Stock Exchange. That was up $2.76, or 4.73 percent, from Wednesday’s close as 12.6 million shares, or nearly twice the daily average volume, were traded.
In a meeting with reporters Thursday morning, Mike DeWalt, vice president of Caterpillar’s Financial Services Division, said he would not describe the company’s outlook as upbeat or anything other than “reflective of what is going on in the world today.” He added that the outlook shows the company is not expecting any sharp turnaround in the global economy or the markets it serves.
Still, he said, the work Caterpillar has done in restructuring itself the past year or so has it well-positioned to survive a continuing down cycle and to take off once the cycle turns. He credited the company’s cash position for much of that, as it is strong enough to meet its expenses, pay dividends and continue investing in research and development.
Caterpillar intends to spend about $2.1 billion on research and development again in 2016, which DeWalt said can signal to investors that the company is looking forward with optimism. Also, he said, continuing to spend on research and development while it can gives Caterpillar an advantage over competitors who cannot afford it.
In a conversation with CNBC on Thursday, Oberhelman said Caterpillar is enthused that Congress recently approved a new, five-year transportation bill that will free billions of dollars for infrastructure improvement. He said the company believes, however, it will be late 2016 or in 2017 before it will realize any benefits from that bill.
DeWalt added that while the $305 billion transportation bill isn’t significantly higher than the temporary bills of years past, a big difference is that it is a five-year bill, which may give some Caterpillar customers more confidence to replace aging equipment.
DeWalt said most of the restructuring Caterpillar announced last September – including job reductions and plant closures – had 2016 in mind as the company already was anticipating it would be another off year. Much of that restructuring has been accomplished, though the company will be announcing some moves as early as Friday.
To date, On Sept. 24, 2015, Caterpillar announced it will reduce its workforce by up to 10,000 people by the end of 2018, with up to 5,000 of that by the end of 2016. Since that announcement the company has eliminated approximately 5,000 positions, including the 2,100 voluntary early retirements. Also, the company has closed or consolidated nine facilities, with more likely.
At the end of 2015 Caterpillar had 118,700 employees worldwide. That was down 12,000 from a year earlier, with 5,600 of the eliminated jobs in the United States.
In his conversation with CNBC, Oberhelman said Caterpillar still wants some relief through corporate tax reform. Asked to explain further, DeWalt said Caterpillar is at a disadvantage in not only that the U.S. corporate tax rate is higher than most other countries of the world, but also in the way the system is set up.
For example, he said, China’s corporate tax rate is lower than that of the United States. If the company brings back any of the money it makes in China from sales, it must pay the U.S. tax rate. “We would just like to see a more level playing field,” he added.
In discussing the 2016 outlook, Oberhelman said it takes into account continuing struggles in the oil and other commodity markets and economic weakness in other countries, including China and Brazil.
“While the U.S. and European economies are showing signs of stability, the global economy remains under pressure. While we manage through these difficult economic times with substantial restructuring actions to lower costs, we are also preparing for the long term,” he said. “Investing in the future is important to improving productivity and the bottom line – for Caterpillar and our customers over the long term. While it is tough to predict when an economic recovery will happen, the investments we are making and the actions we are taking to lower our cost structure and improve quality and our market position will help deliver better results when a recovery comes.”
To read Caterpillar’s full report visit www.cat.com.