Higher health care costs fuel $700M in new spending under Cook County Board President Toni Preckwinkle’s $5.9B budget plan

Oct. 11--Cook County Board President Toni Preckwinkle introduced a $5.9 billion budget Wednesday -- an increase of more than $700 million in spending over the current year's plan, driven largely by growth in the public health system.

Preckwinkle's proposed budget is balanced without any new taxes, fines or fees, her office said, which is unsurprising in an election year when board members are seeking to retain their seats and Preckwinkle is running for Chicago mayor.

The budget includes a $647 million increase in the Health Enterprise Fund, partly due to higher-than-anticipated enrollment in CountyCare -- a largely Medicaid-funded insurance system that has grown dramatically under the federal Affordable Care Act. Officials anticipated 225,000 members last year, but the membership now stands at 332,000, helping explain the revenue and expenditure growth. The county also saw $52 million in sales tax growth that will plug a previously anticipated revenue shortfall.

A good chunk of that additional sales tax revenue is due not only to a better economy, but also to a 2016 increase in the county sales tax by 1 percentage point. That move was an about-face on the key issue that propelled Preckwinkle into office against Todd Stroger in 2010 but that she later cast as a necessary move for the county's pensions, debt costs and transportation infrastructure needs.

With Preckwinkle running to succeed Mayor Rahm Emanuel in February's election, this budget could be the last she introduces as the county's top official. Unveiling the budget, Preckwinkle touted her leadership since taking office in 2010 and placed the budget in the context of nearly a decade's worth of work.

"We have achieved much because we have avoided quick fixes and one-time solutions," Preckwinkle said. "We have done the hard work and heavy lifting to instill sound fiscal discipline and ensure that more than 90 percent of our annual budgetary solutions are structural in nature. And this budget is no different."

Among board members, reaction to Preckwinkle's budget was generally positive, though some argue that her proposal proves last year's pop tax saga was unnecessary.

This year's budget season is expected to be much more low-key than last year's rancorous pop tax debate. In November 2016, Preckwinkle won approval for a penny-an-ounce tax on sweetened beverages. Retailers started charging the tax in August 2017, after it was delayed by a court challenge from store owners.

Under pressure from public backlash fueled by the beverage industry's multimillion-dollar campaign against the tax, the County Board voted last October to repeal it. That left Preckwinkle and commissioners struggling to plug a $200.6 million budget hole with layoffs and the elimination of many vacant positions, among other steps.

Commissioner Larry Suffredin, an Evanston Democrat, said this year's budget "doesn't seem to have any controversy and will probably pass without controversy."

Commissioner Peter Silvestri, an Elmwood Park Republican, said it's "good news" that there aren't any anticipated tax hikes.

Echoing Silvestri, Bartlett Republican Tim Schneider -- who's also the state Republican Party chairman and is facing a tough re-election campaign -- said he's glad not to see a repeat of the pop tax debacle.

"It's obvious that we don't need to dig into taxpayers' pockets once again," Schneider said.

Commissioner Bridget Gainer, a Chicago Democrat, praised the hospital system for its "impressive" increases in revenue.

Outgoing Commissioner Richard Boykin said this proposed budget shows the county "never needed the beverage tax revenue" in the first place.

"It raises the question of who to believe, (Preckwinkle) who was unhappy after the repeal of the tax or (Preckwinkle) this year?" Boykin said. "The former wanted you to believe the sky was falling last year. The latter wants you to believe the county is doing so well this year that we can sock (millions) into a pension stabilization fund and grow our full-time employee numbers."

Boykin also continues to push for a revenue forecasting commission that would give the board independent financial analyses, a measure sponsored by outgoing Commissioner Jesus "Chuy" Garcia.

In a roughly 20-minute speech before the board, Preckwinkle highlighted reductions in the county's debt load, touted the work done by the Cook County Health and Hospitals System and praised reforms to the criminal justice system.

"Despite having to account for borrowing that predated my administration, we have decreased outstanding debt by more than $400 million dollars, or 11 percent, since 2011," Preckwinkle said. "We are living within our means and being disciplined in spending."

The county has an investment grade bond rating, she said, making it "a bit of an anomaly" compared with other large Illinois governments.

"We have done all of this by ending the bad practices of the past," she said. "We are not selling bonds to pay settlement costs or other noncapital purposes. And we are buying assets with short useful lives, like computers, with our operating funds instead of using credit."

In her speech, Preckwinkle said the county had to "adjust some ambitious goals and delay some worthy projects" due to the pop tax repeal, and warned that in the future there will be "tough decisions" that need to be made about the county's budget.

"We continue to benefit from a robust consumer economy as measured by our sales tax revenue, but we should not make the mistake of believing the economic trend line will point upward forever," Preckwinkle said. "In fact, most economists believe we are overdue for a recession, and while it would be convenient to avoid talking about this, I did say that my vision for Cook County included a more transparent and truthful government."

Turning to the hospitals, Preckwinkle praised the work done by the system's leadership, noting she is "proud to say that our health care system is increasingly one of choice, not simply one of last resort."

Soon, the hospital system will establish dialysis services at Provident Hospital "to meet a growing need in the community," Preckwinkle said. Today, the county refers patients to private dialysis centers, "interrupting their continuity of care and sending revenues elsewhere."

"Through collaborative efforts between the public safety stakeholders, which include the Justice Advisory Council, state's attorney, sheriff, public defender, clerk of Circuit Court and chief judge, the jail population is now at its lowest since 1991," Preckwinkle said.

The jail population is down more than 30 percent, Preckwinkle said, from a daily population that used to hover at roughly 10,000.

As part of the proposed budget, the county would give away more than $4 million in grants to 20 community-based organizations, Preckwinkle said.

She praised the Center for Conflict Resolution "for their efforts to offer pro bono mediation services and conflict management training in the county," the Brighton Park Neighborhood Council for its "expansive work to improve education opportunities, provide alternatives to gangs and bring together their community," and Precious Blood Ministry of Reconciliation for its "focus on restorative justice work, work and study programs and resources for neighborhood youth and families."

Preckwinkle also struck a sentimental tone when talking about the positive effect government can have on people's lives.

"One of the true joys of this job is hearing and seeing young men and women thrive after experiencing hardship," Preckwinkle said. "I think at times we forget the good that government can do and that our policies and programs that attack at the grassroots can be life-altering."

Chicago Tribune's Hal Dardick contributed.

gpratt@chicagotribune.com

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