SPRINGFIELD --- The Illinois Supreme Court today gave a thumbs up to Gov. Pat Quinn's showcase $31 billion public works program and the video poker that's supposed to help pay for it.
The 7-0 ruling allows state lawmakers and the governor to exhale after an appellate court had thrown out the deal earlier this year. You can read the state Supreme Court opinion here.
More than just bricks-and-mortar projects involving schools, roads and sewers were at stake in the ruling by the seven Illinois justices. Also at issue were new and controversial sources of state revenue: Increases in driver's license and license plate fees, higher taxes on alcohol, candy, soft drinks and beauty products, and the video gambling. All were targeted to cover the cost of construction bonds plus interest.
Gov. Pat Quinn hailed the "landmark" decision, saying it will ensure the state's effort to create jobs will remain on track.
"What this means is our job recovery programs can go forward full speed ahead," Quinn said. "This is a very gratifying decision of the court, we thank them for their upholding of the law and we move forward."
Quinn could not provide a timeline for when video gambling will be rolled out at bars, restaurants and truck stops to help pay for construction programs, saying regulators should take their time developing rules and licensing procedures.
"We haven't gotten any money from that and we haven't needed any money from that," Quinn said of video gambling, noting the state has been able to borrow money to get building started without that revenue stream. "We want to make sure that anything to do with video gaming is done in a proper, prudent, honest way. And so I have total confidence in the gaming board, that it will carry out its mission of regulation to make sure that everything is on the square. Whatever time they need, so be it. We want to make sure they do it right."
Illinois Senate President John Cullerton praised the ruling.
"This ruling serves as a reminder of just how important the 2009 jobs program was and what the General Assembly can accomplish when politics is set aside and people participate" said Cullerton, D-Chicago, a reference to Democrats and Republicans coming together on the construction deal.
The appellate court had sided with an argument that the law creating the construction program had too many different issues tied together.
The state Supreme Court, in a decision written by Justice Anne Burke, maintained the General Assembly's actions were valid and dealt with a single matter rather than several unrelated matters.
The laws all fell within the boundaries of an overall effort to put together a "capital plan" for the state, she wrote.
The state has borrowed roughly $4 billion to get the construction projects started, said Kelly Kraft, a spokeswoman for Quinn's budget office. Kraft said $1.3 billion of that is left to spend.
Since the construction program began, the state has raked in more than $640 million from the increases in driver fees and additional taxes, according to documents on the state treasurer's website.
The increased taxes and fees have been collected for a little less than two years, and it was possible that a ruling against the state would have required expensive refunds. That in a state that already carries a multibillion-dollar backlog of overdue bills.
The legalization of video gambling at bars, restaurants and truck stops was the most controversial element and promised the most money to the state. But the new gambling hasn't materialized because the state Gaming Board is still working to create a large new regulatory program. In the meantime, dozens of municipalities have rejected the new form of legal gambling.
A recently approved expansion of casino gambling, which is not part of the lawsuit, would require regulators to expedite video gambling.
The case before the Supreme Court involved a multifaceted challenge to a series of bills approved by lawmakers in 2009 and signed by Quinn that created and funded the public works program. Rocky Wirtz, best known as owner of the Chicago Blackhawks, also heads his family's liquor distributorship empire and he alleged in a lawsuit that various provisions of the law were unconstitutional.
A circuit court rejected the Wirtz allegations. Then in January a state appellate court issued a narrow but potentially devastating decision for Quinn and state lawmakers: The law was unconstitutional because it violated the "single-subject rule," a provision that prohibits combining various unrelated subjects into the same bill. The appeals court stayed enforcement of its ruling while it was appealed to the Supreme Court.
The "single-subject rule" was designed to prevent bundling less popular initiatives into more palatable bills to make them easier to pass, a process known as logrolling.
Logrolling was a popular legislative tool from the state's beginnings. Legislation that then-state Rep. Abraham Lincoln pushed in 1837, linking a massive public works program with a move of the capital to Springfield, was the inspiration for the "single-subject rule" being adopted in the Illinois Constitution. The state later defaulted on its debt from the 1837 public works plan.
The appellate court ruled the various aspects of Quinn's public works program did not fit within a single broad category of "revenue" and that the state's arguments were "unconvincing."
The appeals court said provisions that included mandating a University of Illinois study on the effects on Illinois families of purchasing lottery tickets, a required quarterly accounting by the state of public works expenditures and a change in truck-weight limits had "no natural and logical connection to revenue to the state."
But Attorney General Lisa Madigan, on behalf of the Quinn administration, argued to the Supreme Court that the law's provisions fell under a single umbrella of "capital projects," not the subject of "revenue" that the appeals court used.
Pressing the necessity of keeping the public works program intact, Madigan's appeal to the Supreme Court noted it was passed by lawmakers "when the state's economy was suffering the effects of the severe recession gripping the entire nation." She noted that in the 15 months prior to passage of the plan, the state's unemployment rate rose from less than 6 percent to more than 10 percent.
Quinn had forecast the public works program would create or retain 439,000 jobs over six years.
Lawyers for Wirtz and his distributorship, Wirtz Beverage Illinois LLC, also alleged that the state improperly raised taxes on beer at a lower rate than those on wine and spirits.
His lawyers said Wirtz and his firm "seek to have the constitution enforced as written, rather than ignored for purposes of expediency as it was in the legislation challenged here."Copyright © 2014, Los Angeles Times