NORTH CAROLINA Gov. Pat McCrory (R) signs HB 553, which bars local governments from enacting their own regulations regarding the standard of care for farm animals (HIGH COUNTRY PRESS [BOONE]).
-- Compiled by RICH EHISEN
When it comes to email triage, company newsletters often get relegated to the end of the line, even among the most highly engaged employees. And, according to Gallup poll figures, 68.5 percent of American workers are “not engaged” or “actively disengaged,” making them even less likely to pay attention when an internal newsletter appears in their in-box. What’s this mean to you—the distributor of critical business intelligence that has the power to drive better decisions? It’s time to explore new tactics for driving employee engagement with internal newsletters.
During the SCIP Conference earlier this year, I met Dr. Michael Sutton, an associate professor at Westminster College and respected expert in knowledge management, immersive learning and more. Since he’s currently a competition judge for the Games4Health Challenge, I was curious about his thoughts on using gamification to enhance corporate internal information sharing.
He replied that it is an “interesting challenge” and one that is complicated by an audience that is “stratified across multiple generations.” How do you appeal to the Millennials in your company while still engaging the Gen-Xers and Baby Boomers? He recommends conducting some internal market research and even focus groups to improve your understanding of your audience. He also recommended a number of sources for reference. Here are three tips that I picked up:
After talking with Dr. Sutton, I know this barely scratches the surface—but everyone has to start somewhere. Have you experienced positive results using gamification to drive more awareness for the business intelligence you’re distributing?
The pharmaceutical industry has been impacted by globalization more than most. Where there was traditionally a significant difference between the levels of healthcare and well-being between the developed and developing worlds, there has been rapid and complex change.
With an increased demand for cures to all manner of illnesses, management of an increasingly elderly global population and the development of a stream of new genetic techniques, there can be few industries facing so many shifting sands of change.
At the same time, demand for lower cost drugs is limiting the time between research and mass adoption, reducing the time available for research, development and testing. Globalization is also seeing an increasing number of mergers and acquisitions as well as a more complex, global supply chain for pharmaceutical companies.
The sheer number of issues faced by due-diligence professionals in the pharmaceutical industry is vast: from pricing to research; supply chain management to ethical marketing; patient safety to clinical trial management, there are so many potential risks to pharmaceutical companies, both from a reputational perspective and from a regulatory one.
Such issues can impact both on reputation and the bottom line. In 2012, the EU’s highest court upheld a fine against AstraZeneca for blocking the entry of cheaper rivals to its ulcer drug Losec. The fine was $52.5 million.
All of this points to the need for the highest possible level of scrutiny when it comes to due diligence. If the industry moves rapidly, so compliance professionals and corporate officers need to move quicker still to remain on top of significant corporate risk.
Paying lip service to due-diligence matters will not cut it in this environment. In a complex environment where there may be multiple global joint ventures taking place, sales people operating across the world and products being sourced from dozens of different countries, a proactive, comprehensive and ongoing compliance and due-diligence activity is required.
With so much information available for free or at low cost online, it is tempting for pharmaceutical companies to rely on publically-available information to check third-party partners, distributors and suppliers. In fact this is as good as useless. Unless compliance officers can be sure of the source of information, it cannot be relied on. Databases that provide access to checklists are only as effective as the regularity with which they are updated.
Very few names are unique, so it can also be difficult to know with certainty that an individual or company is the entity with which you are working. Databases that throw up any possible matches are only useful up to a point where manual intervention needs to take place. Pharmaceutical companies with hundreds of customers may have to plough through thousands of potential matches, with little idea of which are correct—an extremely onerous manual task.
LexisNexis uses a complex cross-referencing process to ensure the reduction of false positives and to reduce the number of matches to a far more manageable number, enabling due-diligence personnel to focus on policy and implementation rather than laborious and repetitive tasks.
In other industries, the ability to demonstrate an effective due-diligence process that has been outlined, followed and carefully cataloged has acted as mitigation to companies facing issues with third-party suppliers or partners. The very act of carrying out a thorough and effective due-diligence process has counted in the company’s favor.
There have never been more reasons for pharmaceutical companies to turbo charge due-diligence practice. The complexity of the modern supply and customer chain, combined with the increasing volume of regulation and fines being issued, presents perhaps the most critical risk to pharmaceutical companies today. LexisNexis can help you to ensure that you have an effective and meaningful due-diligence program, even for the most complex companies’ circumstances.
With the recent burst of OFAC fines issued to businesses, sanctions represent a very real and potentially damaging area for any business trading internationally.
Recent cases include the New York Branch of National Bank of Pakistan, who received a total fine of $55,952.14 for wire transfers that the bank had made to entities on their list of Specially Designated Nationals. The bank blamed the misconduct on a software failure, meaning they could have been avoided if the bank’s sanctions compliance software had alerted them that Kyrgyz Trans Avia, an airline in Bishkek, Kyrgyzstan, was on OFAC’s sanctions lists.
Paypal’s screening process had similarly let them down in March of this year, exposing them to a huge $7.7M fine from the U.S. Treasury Department after they had allowed payments which violated sanctions by allowing a total of 136 transactions in the account of Kursad Zafer Cire, a Turkish man on the U.S. State Department's list of weapons of mass destruction proliferators.
In the same week, OFAC had also issued John Bean Technologies (JBT) with a $391,950 fine for violating U.S. anti-nuclear proliferation sanctions. JBT, a maker of aircraft ground support equipment, had been involved in a shipment aboard a blocked vessel on the Islamic Republic of Iran Shipping Lines (IRISL). If JBT’s senior management had voluntarily self-disclosed the misconduct, OFAC could have established a base penalty fare for the company for violations of their regulations. JBT were aware that dealing with IRISL was unlawful and, after the U.S. bank rejected the trade documents, JBT were therefore subject to a substantially greater civil penalty.
The international sanctions regime is a dynamic and rapidly changing area which continues to develop outside the compliance program and overlaps jurisdictions, geography and national borders. Sanctions affect every area of a firm's compliance process from risk assessment, policies and procedures, through internal and external data systems and controls to case management and modelling.
Is your compliance process robust enough to help mitigate this risk? Find out how to stay out of the risk zone with some top tips in the LexisNexis Sanctions Uncovered magazine.
It’s a given that before any merger or acquisition, your company conducts due diligence. The question is, are you drilling down to the right information? Financial due diligence is important, of course, but it only scratches the surface. These days, conducting business—including M&A activity—in a global, high-regulated business environment requires a more comprehensive approach to due diligence. Just ask Worthington Industries.
What do Russian uranium and a small, Ohio town have in common? That’s precisely what investigators for the Justice Department are sorting out as they continue their bribery probe into Worthington Cylinders, formerly Westerman Cos. In 2012, Worthington Industries acquired Westerman Cos, a 100-year-old company that manufactures steel containers used for shipping uranium. While the company didn’t have any competitors in the U.S., they were competing for business against companies in the Netherlands and France. And that’s where the trouble started.
According to a Wall Street Journal article looking into the allegations, U.S. authorities already had their eyes on Russian nuclear officials in an 8-year-long investigation when a Westerman executive attracted their attention as well. Authorities now allege that this executive paid tens of thousands of dollars in bribes to Russian officials to influence contract negotiations. Authorities began moving forward with a criminal case against Vadim Mikerin, a Russian citizen, who has been accused of arranging for bribes to be “channeled through a maze of secret accounts in Cyprus, Latvia and Switzerland,” said the Wall Street Journal.
If this wasn’t bad news on its own, then the fact that the bribes began before Worthington’s acquisition of Westerman—and then continued unnoticed more than two years later—certainly has put the company’s existing due-diligence process in the spotlight.
Foreign Corrupt Practices Act prospections have been on the rise, and this case only emphasizes how important it is to look at more than just financial risk potential when evaluating potential acquisitions, suppliers or other third parties acting on behalf of your organization. With a deeper look at risk factors, such has conducting business in a region that is well-recognized as a bribery hot spot, Worthington might have been forewarned and approached the acquisition with more caution. The company is cooperating with authorities, but as the Justice Department has intimated before, failure to see what is going on is no excuse. Is your due-diligence process missing something important?
Editor: Rich Ehisen
Associate Editor: Korey Clark
Editorial Advisor: Lou Cannon
Contributing Editor: Mary Peck, David Giusti
Correspondents: Cathy Santsche, Felicia Carrillo
Graphic Design: Vanessa Perez Design
The campaign trail can be so brutal. Case in point this week comes from Manchester, New Hampshire, where Wisconsin Gov. Scott Walker ran into a pair of enthusiastic supporters of his effort to capture the 2016 GOP presidential nomination. As the Washington Post reports, the pair were giddy to meet Walker, even sporting a sign voicing their desire to see him become president. With all that, Walker was more than happy to pose for a picture with the duo. Alas, as the photogs took their snaps, Walker’s alleged fans surreptitiously flipped the sign around to reveal a game show-style check made out to Walker from the Koch brothers, the billionaire brothers who have pledged to spend almost $900 million to get a Republican elected president in 2016. It got worse from there, as various other...uh, unique...folks dropped by to weigh in on Walker, prompting his campaign manager to mutter that “It’s like a full moon.”
ILLINOIS Gov. Bruce Rauner (R) signs SB 7, legislation that requires students who suffer a concussion to get permission from a doctor or athletic trainer before they fully return to class or sports (CHICAGO TRIBUNE).
The Maine Supreme Court dealt Gov. Paul LePage (R) a stinging rebuke last Thursday, unanimously rejecting his plea to force lawmakers hold override votes on 65 bills he vetoed on in July.
The challenge was the latest action in what has become an ongoing battle between LePage and lawmakers. The governor earlier this year vowed to veto every bill authored by a Democrat in retaliation for them not supporting his call to abolish the Maine state income tax. But in recent months his veto pen had also been applied to numerous Republican-backed measures, sparking a wellspring of resistance from his own party that saw them support the override of hundreds of his vetoes. The situation came to a head on July 16 when he sent lawmakers the 65 bills in question. But lawmakers contended that since they had given him the bills on June 30, the 10-day window for him to sign or reject them had passed and they were now. The dispute centered on one key point: had lawmakers adjourned on June 30 - as LePage contended and which would have negated the 10-day window - or had they just gone into recess, which would have kept it in force. On Thursday, the high court sided with lawmakers, saying the bills were now law and ordering him to enforce them.
The ruling was hailed by Democrats and even most Senate Republicans, though House Minority Leader Ken Fredette (R) was one of several House Republicans to appeal to the court to allow them hold the override votes. Senate President Michael Thibodeau (R) conceded he is opposed to several of the bills that became law, but told the Bangor Daily News the ruling reaffirmed the Legislature’s process and authority. He also hoped it would ease the tensions between the two branches of government.
“The executive and legislative branches must work together. I encourage the administration to reset their relationship with the Legislature to foster an environment of engagement and collaboration,” he said. (BANGOR DAILY NEWS, GOVERNING
Last month Virginia Gov. Terry McAuliffe (D) appointed former Fairfax Circuit Court judge Jane Marum Roush to the state Supreme Court to replace retiring Justice LeRoy F. Millette Jr. Although judicial appointments in the state are usually made by the General Assembly, when it is not in session, as in this case, the governor has the authority to fill a vacancy with an appointee whose term expires 30 days after lawmakers reconvene. But for the first time since 1900, lawmakers are refusing to reappoint the governor’s interim appointee to a full 12-year term. They say they intend to appoint Virginia Court of Appeals Judge Rossie D. Alston Jr. when they convene on Aug. 17 for a special legislative session on redistricting instead.
McAuliffe accused Republicans who control the General Assembly -- and with whom he has been feuding recently over recordings of Planned Parenthood officials in California and Colorado discussing fetal tissue harvesting -- of, among other things, sexism.
“This woman is highly qualified, and I’ve got to tell you, it doesn’t send a good message to women around the commonwealth of Virginia,” he said. “This is the same group of individuals who have tried to roll back women’s rights and tried to hurt women’s rights in the commonwealth of Virginia.”
But Republicans maintained that unlike previous governors, McAuliffe hadn’t sought their input and collaboration in choosing Roush, and that although both Roush and Alston were qualified, the latter had the support of the GOP caucus.
“It is our intention to elect him when the special session convenes,” said House Speaker William J. Howell (R).
That action isn’t likely to smooth things over between McAuliffe and lawmakers.
“This is certainly going to make relations with the governor more challenging and difficult,” said Bob Holsworth, a former professor of political science at Virginia Commonwealth University. “It is a very deliberate rebuff.” (WASHINGTON POST)
As states continue to recover from the Great Recession, several are embracing a tax credit to help bring working families along. This year five states, including California and Massachusetts, where a Democrat and a Republican hold the top office, respectively, have enacted or enhanced Earned Income Tax Credits, which lower the state income tax bills of moderate- and low-income workers.
“I have always liked the Earned Income Tax Credit because it doesn’t have any particular bureaucracy or complexity,” said California Gov. Jerry Brown (D). “It’s just a straight deliverance of funding to people who are working very hard and are earning very little money.”
Massachusetts Gov. Charlie Baker (R), likewise, said, “You can debate all day how other supports work, but this one’s pretty clear: If you work a certain number of hours, and you qualify, you get the credit. I think that’s a good thing and I think we should do more of it.”
The federal EITC was adopted in 1975, and 26 states now have their own versions of the credit. Michael Leachman, director of state fiscal research at the progressive Center on Budget and Policy Priorities (CBPP), said the EITC has “enjoyed bipartisan support” for years. Liberals see it as a way to help narrow the income inequality gap for the poor, and conservatives see it as a reward for work.
“It’s been thoroughly studied and it really does help low-income families to make work pay,” said Leachman. (STATELINE.ORG, STATE HOUSE NEWS SERVICE)
As of 2013, Illinois had the most underfunded public pension system in the nation on a percentage basis, according to data from the Pew Charitable Trusts. The state only had enough assets in its pension accounts to cover 39.3 percent of its pension liability. And only California had more pension debt in terms of dollars, $169,633,728 compared to Illinois’ $100,800,547. South Dakota and Wisconsin had the highest pension “funded ratio,” at 99.9 percent, with pension debts of $7,598 and $52,600, respectively.
Source: Pew Charitable Trusts
Legend:
States with biggest pension debt by percentage: Illinois, Kentucky, Connecticut, Alaska, New Hampshire
States with smallest debt: South Dakota, Wisconsin, North Carolina, Oregon, Tennessee
The shadow of unfunded public pension liabilities casts a menacing cloud over the otherwise mostly bright futures of U.S. states and municipalities. The situation is gravest in Illinois, where court rulings have stymied legislative attempts at reform, but a score of states and a slew of cities also face significant challenges from unfunded pension liabilities.
Against this backdrop, a recent settlement in San Jose with union officials on a disputed voter initiative known as Measure B may show at least a partial way out of the public pension morass in which many states and cities are trapped.
Although a few states are doing well, a report by the Pew Charitable Trusts and an analysis of California public pensions from the Public Policy Institute of California (PPIC) paint an overall bleak picture. Pew found that the nation’s state-run systems had a $968 billion shortfall in 2013 — the last year for which complete data is available — that rose to more than $1 trillion if municipal liabilities were included. Furthermore, the systems as a whole are headed in the wrong direction, adding $54 billion to the debt from the previous year.
There is a Washington anecdote, probably apocryphal, that President Harry Truman once said he wanted a one-armed economist. An aide asked why. “Because economists are always saying ‘on the one hand, and on the other,’” Truman supposedly replied.
“On-the-one hand, on-the-other” pretty well describes the latest PPIC findings about California’s public pension liabilities. The good news is that investment returns have been higher than expected. The less good news is that the Golden State’s two largest pension funds, the California Public Employee Retirement System (CalPERS) and the California State Teacher’s Retirement System (CalSTRS) show unfunded liabilities of $62 billion and $74 billion, respectively, for the 2013 fiscal year.
Liabilities have continued to soar because the pension funds are structurally underfunded, a fancy way of saying that state employees and teachers don’t contribute enough to keep them solvent. Demographic factors are also at work. The PPIC report found that the percentage of adults aged 65 and older increased from 9 percent of the population in 1970 to 13 percent in 2013 and is projected to be 17 percent in 2025. This is a recipe for eventual fiscal calamity.
While public unions downplay the significance of unfunded liabilities, saying they are not as onerous as bonded debt, some pension scholars claim they’re worse. “For citizens and taxpayers, unfunded pension liabilities are actually more of a burden than bonded debt,” David Crane of the Stanford Institute for Policy Research told the Orange County Register. He observed that pension liabilities have a higher priority in bankruptcy proceedings than any other kind of debt and usually must be repaid first.
States can’t go bankrupt under federal law, but cities and other local government entities are allowed to do so in many states. Orange County, California, went bankrupt in 1994. Detroit, in 2013, was the largest U.S. city ever to go bankrupt. The financial condition of Chicago, the nation’s third most populous city, is shaky. According to Governing magazine, 36 cities, towns, and other governmental units have filed for bankruptcy since 2010.
In this context, city officials in California and pension reformers everywhere can take modest comfort from an agreement announced in San Jose last month by Mayor Sam Liccardo. San Jose voters in June 2012 approved Measure B, which rolled back retirement benefits. It gave city workers a choice of paying more into their pension funds or receiving a reduced pension. Public unions sued, and a judge struck down that section of the measure. Her ruling was under appeal when the city reached a settlement with unions representing police and firefighters that is expected to serve as a template for similar agreements with other city unions.
Both sides put on happy faces after the settlement, stressing what they had won. For the city and the pension reformers, this meant scaling back pensions for new hires and eliminating bonus checks for retirees. For the unions, it meant preserving pensions for previous hires and eliminating the key requirement that retirees contribute more to their pensions. Disability payments that would have been cut by Measure B were preserved, but future disabilities will have to be certified by a physician rather than by a board on which the union is represented.
Given past rulings of the California Supreme Court, the San Jose compromise was probably the best that reformers could have hoped for. The state’s high court has held that the California Constitution provides extraordinary protection for pensions. Once a worker is hired, his or her pension status is inviolate.
The legal find that public pensions are set in stone sets them apart from other issues. Other laws that prove too costly can be changed. But the Legislature and local governments don’t have that alternative with pensions, which in California are more generous for public employees than for most of their counterparts in private industry. In 1999, when the stock market was booming, the Legislature passed SB 400 at the behest of Gov. Gray Davis (D), reducing the retirement age for state workers from 60 to 55 with pensions paying 2 percent of salary for each year worked and basing pensions on the highest single year’s salary rather than the previous average of three years. The state standard was widely copied by local governments, which in many cases made benefits retroactive.
Small wonder that Crane calls SB 400 “the single greatest issuance of debt in state history.” In 2003, the unfunded liabilities of the 80 public pension systems in California totaled $6.3 billion. By 2004, with the new provisions in effect, it had reached $50.9 billion. By 2013, it had topped $198 billion.
California’s situation on public pensions, dire as it is, pales in comparison to Illinois, the Greece of American states. The Prairie State ranks dead last in fiscal health among the 50 states and has unfunded public pension liabilities of $164 billion. The liabilities for Chicago’s four pension funds and a teacher’s fund amount to another $20 billion. According to Pew data, Illinois public workers contribute only 39 percent of the money needed to fund their pensions.
For years, pension reformers in Illinois were thwarted by the Democratic-controlled Legislature, which was too often in thrall of the public unions. By 2013, however, the state’s sagging credit ratings induced previously resistant Democrats to raise the retirement age for public workers and reduce cost-of-living increases for retirees. In 2014, the Legislature passed another measure that reduced cost-of-living increases for retired Chicago city workers and increased their contributions to pension funds.
The legislative turnaround went for naught. In May the seven-member Illinois Supreme Court unanimously struck down the 2013 law with an Olympian pronouncement. “Crisis is not an excuse to abandon the rule of law,” the court said. “It is a summons to defend it.” Then last month, Cook County Judge Rita Novak overturned the 2014 law for Chicago city workers, brushing aside a plea from Mayor Rahm Emanuel. Gov. Bruce Rauner (R) now proposes a state constitutional amendment that would allow pension cuts for state and city workers. But passage requires a three-fifths favorable vote both by the Legislature and the public, unlikely in a Democratic-leaning state with activist labor unions.
The U. S. federal system allows much leeway to state courts. As with Illinois and California, courts in Arizona, New York and Oregon have barred reducing existing pension benefits. Courts in Colorado, Minnesota, New Mexico and South Dakota have permitted such reductions.
This patchwork of judicial decisions contributes to an enormous variance among states and municipalities in the health of their pension funds, some of which suffer from insufficient contributions, missed payments or poor investment performance. The Pew report found that only 22 of the 50 states fully fund their pension systems.
The plight of underfunded public pension systems is likely to become worse as members of the Baby Boom generation retire and the number of retirees in relation to the number of workers accelerates. Addressing this issue is one of the great political challenges of our time, for Social Security as well as state and local pension funds.
There is no one-size-fits-all solution. But the common sense displayed by city officials and union leaders in the San Jose settlement on Measure B, copied Aug. 5 in an agreement negotiated by Los Angeles with its municipal workers, provides a modicum of hope. Protecting current retirees while also requiring higher pension contributions by future hires is a step down a promising path toward the elusive goal of fiscal solvency. What happened in San Jose is worth emulating.
-- By Lou Cannon
As Gov. Walker discovered, these days it is almost impossible to account for all the ways someone can make your life miserable. He will surely get some sympathy from Asa Hutchinson, his gubernatorial colleague from Arkansas. As the Huffington Post reports, someone angry with Hutchinson’s opposition to same-sex marriage recently noticed that the governor had not renewed his ownership of asahutchinson.com, the internet domain name most closely associated with him. Oops. Gay rights activist Dylan Hailey quickly bought up the name, which now takes users not to a site extolling Hutchison’s work and policy stands, but to a gay, lesbian, bisexual and transgender chat room. Methinks someone is going to get fired over this one.
President Barack Obama unveils a plan that calls for states to curb emissions 32 percent below their 2005 level within the next 15 years. Under the new regulations, states will have to present at least an initial plan for how they will achieve the reductions by Sept. 6, 2016. A final version will be due by 2018. The new standards are projected to cut 870 million tons of carbon dioxide emissions out of the atmosphere by 2030 (GOVERNING).
The CALIFORNIA Department of Fish and Game adopts new rules that adopt a statewide ban on the trapping of bobcats. The ban takes effect immediately (KCET.ORG [BURBANK]).
Arizona Gov. Doug Ducey (R) said he plans to ask the Obama administration to allow the Grand Canyon State to require about 350,000 able-bodied adults currently on Medicaid to pay co-pays for some of their health care services and to put 2 percent of their annual income into a health savings plan.
Money from those accounts could only be used to pay for non-covered services like eyeglasses or dental work, and only if the account holders meet at least one “wellness incentive,” such as ceasing to smoke. They would also be required to participate in a work search program or attend school if they are unemployed. Co-pays would only be applied to what the state deems to be wasteful services – such as unnecessary emergency room visits or missed doctor appointments – and have an annual cap of 3 percent of income.
Arizona expanded its Medicaid rolls under former Gov. Jan Brewer (R), though the expansion was never popular with the GOP-dominated Legislature. Most of the changes Gov. Ducey is proposing would apply primarily to the additional enrollees who came into the system under that expansion as well as childless adults or parents who aren’t caregivers and earn less than 100 percent of the federal poverty limit.
But the state would need to obtain a waiver from federal health officials before implementing those changes. Other states have received waivers for similar changes, but did so as part of expanding Medicaid to residents earning up to 138 percent of the federal poverty level as called for under the Affordable Care Act. Ducey signed legislation earlier this year requiring the Arizona Health Care Cost Containment System [AHCCC] to apply for a waiver limiting benefits to a lifetime maximum of five years and requiring able-bodied participants to work. Brewer vetoed a similar bill in 2014, and the federal Centers for Medicare and Medicaid Services has previously indicated such rules were unlikely to be approved. (ARIZONA REPUBLIC [PHOENIX], PHOENIX BUSINESS JOURNAL)
The U.S. 5th Circuit Court of Appeals ruled last week that Texas’ four-year-old voter ID law is not an unconstitutional “poll tax” as plaintiffs alleged but that it has a “discriminatory effect” that violates the federal Voting Rights Act. The three-judge panel’s unanimous ruling, which came the day before the Voting Rights Act’s 50th anniversary, sends the case back to a lower court to determine how Texas should fix the law, which will remain in effect as is for now.
The lead plaintiff in the case, U.S. Rep. Marc Veasey (D-Texas), said the appeals court’s decision had moved the state in the direction of giving all of its citizens full voting access.
“Now it’s time for Governor Abbott and Attorney General Paxton to end the hostility against Texas voters,” he said in a statement.
Gov. Abbott, meanwhile, vowed to keep fighting for the voter ID law.
“In light of ongoing voter fraud, it is imperative that Texas has a voter ID law that prevents cheating at the ballot box,” he said in a statement. (TEXAS TRIBUNE)
During the Great Recession college tuition rates rose steeply to replace state education funding lost to budget cuts. But with student loan debt nearing $1 trillion nationwide and families of every income level worried about the rising cost of college, state lawmakers are trying to relieve some of the pressure.
Minnesota passed legislation this session freezing tuition at two-year colleges in the state this fall and cutting tuition next year. Ohio’s new two-year budget freezes tuition at that state’s public colleges and universities. And Wisconsin has frozen in-state tuition at its 26 university campuses.
But a long-term solution to rising tuition rates will ultimately require a change in the behavior of American families, according to David Strauss, a principal at the Baltimore-based consulting firm Art & Science Group. Strauss said families are voicing concern about the high cost of college, but they’re not moving toward less expensive institutions with fewer amenities.
“The marketplace hasn’t yet caught up with the rhetoric,” he said. (STATELINE.ORG)
ILLINOIS Gov. Bruce Rauner (R) signs SB 1298, which allows a Prairie State resident entering the hospital to designate a caregiver prior to discharge to the patient's home or transfer to another facility. The new law requires hospitals to notify the caregiver prior to the patient’s discharge or transfer and to consult with the caregiver on a discharge plan for the patient's after-care needs (NEWS-GAZETTE [CHAMPAIGN]).
The NORTH CAROLINA House tentatively approved a nearly $3 billion bipartisan bond proposal for roads and government infrastructure that would go before voters in the fall. Another vote was required in the House before HB 943 could move to the Senate (ASSOCIATED PRESS, FAYETTEVILLE REPORTER, LEXISNEXIS STATE NET).
PENNSYLVANIA lawmakers are looking into borrowing to keep the government running as the state’s budget impasse drags into its second month. The state has been operating on reserves since the last fiscal year ended on June 30 (PATRIOT-NEWS [HARRISBURG]).
Cleveland is appealing the OHIO Supreme Court’s ruling in April striking down its “jock tax” on visiting professional athletes to the U.S. Supreme Court. The city has asked the state Supreme Court to stay its ruling pending that appeal (CLEVELAND PLAIN DEALER). OHIO Treasurer Josh Mandel’s (R) plan to expand the state’s online spending database, OhioCheckbook.com, to include local government expenditures will cost $2.7 million over the next two years. But Mandel said that’s “a fraction” of the $6 million his office has saved the state since he was elected treasurer four years ago (CLEVELAND PLAIN DEALER).
With WISCONSIN Gov. Scott Walker’s (R) approval of a new two-year budget last month, the state has now forgone $550 million in federal money available to it under the Affordable Care Act. Unlike other Republican governors who have affirmed their opposition to Obamacare by refusing to expand Medicaid, Walker has opted instead to expand his state’s program by 145,000 people without accepting any federal money for doing so (MILWAUKEE JOURNAL SENTINEL).
The administration of KANSAS Gov. Sam Brownback (R) announced last month that it will make nearly $63 million in spending cuts and fund transfers to bolster the state’s cash reserves. The biggest single reduction, $17.7, will be to the State Children’s Health Insurance Program (LAWRENCE JOURNAL-WORLD).
- Compiled by KOREY CLARK
...comes courtesy of Colorado state Rep. Dan Pabon, who was part of a panel discussion on legalizing marijuana at last week’s big National Conference of State Legislatures Annual Summit in Seattle. Noting that he represents part of the capital city of Denver, Pabon took great pains to note that “Denver was known as the Mile High City long before Colorado legalized pot.” True, but one might say that strict interpretation has gone up in smoke.
- By Rich Ehisen
ILLINOIS Gov. Bruce Rauner (R) signs legislation that requires large airports to install lactation rooms for new moms. The new rooms must be in place by 2017, although smaller airports will have to make the upgrades only when building new terminals or renovating current ones (SOUTHER ILLINOISIAN [CARBONDALE]).
CALIFORNIA Gov. Jerry Brown (D) sent an open letter last week to the 17 Republican presidential aspirants asking them to lay out a detailed plan for combatting climate change. “Longer fire seasons, extreme weather and severe droughts aren’t on the horizon, they’re all here – and here to stay. This is the new normal. The climate is changing,” Brown wrote. “Given the challenge and the stakes, my question for you is simple: What are you going to do about it? What is your plan to deal with the threat of climate change?” As of this writing, none of the candidates had replied to the challenge (CALIFORNIA GOVERNOR’S OFFICE).
ARKANSAS Gov. Asa Hutchinson (R) said the Razorback State would push back by two weeks plans to terminate coverage for thousands of Medicaid recipients as the state tries to verify the incomes of those enrollees. Hutchinson said the state is sifting through thousands of responses from Medicaid recipients it sent income verification requests to in recent months (ARKANSAS ONLINE).
RHODE ISLAND Gov. Gina Raimondo (D) issued Executive Order No. 15-14, which will create the Governor’s Overdose Intervention and Protection Task Force. The group will devise strategies for combatting a dramatic spike in opioid overdose deaths in the Ocean State, with a report due to the governor by June 30, 2016 (LEXISNEXIS STATE NET).
- Compiled by RICH EHISEN
A federal court strikes down an IDAHO law that banned documentation of animal abuse at livestock operations. U.S. District Judge Lynn Winmill ruled that the law violated the First Amendment of the U.S. Constitution. Gem State officials are considering an appeal (REUTERS). * A federal judge rules that VIRGINIA may ban future issuance of license plates featuring the Confederate flag. U.S. District Jackson L. Kiser said he would issue a later ruling on whether the state can revoke the approximately 1,600 plates bearing the flag that have already been issued (WASHINGTON POST).
Illinois’ Democrat-controlled Senate passed legislation last month that would freeze property taxes statewide for two years and provide about $200 million in relief for Chicago’s troubled teacher pension system. But Gov. Bruce Rauner (R) said that while he supported the idea of a temporary tax freeze, he opposed giving Chicago a “special” deal and advocated giving towns and school districts more control over what is subject to collective bargaining instead.
“Rather than doing a special one-off deal for Chicago, the right answer is to allow school districts in Illinois, all local governments in Illinois, to have these decisions made by them at their level, then Chicago wouldn’t be in this fix,” Rauner said. “We should treat the people of Illinois equitably and fairly and stop doing special deals for Chicago. Illinois should not be a dictatorship for Chicago.”
Chicago Public Schools CEO Forrest Claypool said the Senate’s plan would “buy time” for lawmakers to determine how to help the city’s school district, the third largest in the nation. Claypool also said he was trying to negotiate a new contract with the Chicago Teachers Union right now and didn’t want Rauner’s collective bargaining proposal thrown into the mix.
“We were encouraged when Springfield took its first step toward fairness, and we don’t believe that mixing labor issues into this bill will help address CPS’ fiscal situation,” he said. “We want to see a comprehensive solution move forward, and we are eager to work with all our partners so that our children don’t pay the price of inaction.”
But even without Rauner’s criticism, the Senate plan faces potential resistance in the House, with Speaker Michael Madigan (D) having said the state should be reducing its share of local pension costs, not increasing it. (HUFFINGTON POST, CHICAGO TRIBUNE, LEXISNEXIS STATE NET)