The Week in Review for October 23

COVID-19

New numbers show “second wave” of viral transmission in Illinois.  The Illinois Department of Public Health (IDPH) has now reported results from more than 7.0 million coronavirus tests performed in Illinois as of Thursday, October 22.  Slightly more than 5% of these tests have come back positive, with more than 360,000 confirmed cases reported. 

On two separate days over the past seven-day period, on Friday, October 16 and again on Thursday, October 22, new positive cases have passed 4,500 per day.  The count of positives cases was 4,554 on October 16, and was 4,942 on October 22.  Both counts were records for a 24-hour period in Illinois.

Many of these confirmed cases are patients who have not suffered severe symptoms; however, some have had to be hospitalized.  As of this week, more than 9,300 Illinoisans have died from COVID-19.

The current numbers of test requests, test positives, and referrals of positive cases for further medical treatment all indicate that the contagious virus is once again surging in many parts of Illinois.

Regions 5, 7, and 8 placed in enhanced mitigation.   The ‘positive case count,’ tabulation of the total number of positive COVID-19 diagnoses as a percentage of total tests taken and submitted for analysis, has moved above 8% in three public health regions within Illinois.  This 8% benchmark is measured in terms of a 7-day rolling average posted during three consecutive days.  This level of test results generates a statistically significant data set.  It signals an active viral presence and transmission.

These three regions include significant percentages of the total population of Illinois.  Region 5 is a twenty-county region that includes the southernmost section of Illinois, centering on Carbondale and stretching from Cairo to Centralia.   As for the Chicago suburbs and exurbs, Region 8, with well more than 1 million people in it, contains DuPage County and Kane County.   Region 7 (Kankakee County-Will County) has previously been in enhanced mitigation and is now being returned to that status.

The enhanced mitigation orders, issued on Monday, October 19 and Tuesday, October 20, will hit residents and small businesses.  Restaurants, bars, and taverns are ordered to stop their remaining indoor table service of food and drink.  Customers can continue to buy takeout and curbside food and drink, and can sit at outdoor tables if weather permits, but all outside bar and food service must stop at 11 p.m. nightly.  In addition, social distancing requirements will be maintained and strengthened in various ways.  The Illinois hospitality industry is deeply concerned about the implications of carrying out COVID-19 mitigation orders as wintertime cold weather approaches.   

The new Region 5 orders went into effect on Thursday, October 22.  The new Region 8 order and the re-instituted Region 7 order went into effect on Friday October 23.  Region 1 in northwestern Illinois was already under a separate set of mitigation orders.  These orders constitute four of the eleven public health regions of Illinois.  The IDPH is closely monitoring COVID-19 tests and diagnoses in the seven other regions of Illinois.  Five of these regions are in the greater Chicago area, and Downstate Illinois is divided among six regions.  

Region 1, centering on Rockford, placed under additional mitigation restrictions.  The move, announced on Thursday, October 22, followed a further surge in positive case counts in the northern Illinois region.  The numbers indicated that as many as 11.9% of the coronavirus tests being performed in this area were returning positive results, indicating infection with COVID-19.   Region 1 includes nine counties – Boone, Carroll, DeKalb, Jo Daviess, Lee, Ogle, Stephenson, Whiteside, and Winnebago – within that portion of northern Illinois that lies outside the greater Chicago area.

Under the additional mitigation restrictions, serious limits have been placed on public gatherings, moving the status of public law back closer to the shelter-in-place order in effect during the spring of 2020.  Public gatherings can have no more than 10 people in them.  Outdoor tables at restaurants and taverns can have no more than six people in them.  Other restrictions are now in place.    

BUDGET

New round of Illinois debt sold this week at high interest rates.  The $850 million in bonds were placed on the marketplace on Tuesday, October 20.  Investors demanded that Illinois pay an interest rate that was 2.81% (281 basis points) higher than the interest payments made by borrowers with a triple-A (AAA) bond rating.  The high interest rate was described as a market response to Illinois’ poor budget situation and high pension debts.

Analysts pointed out risk factors facing lenders of money to Illinois.  These factors included the enactment of a partisan budget by Democrats that contains speculative revenues, Illinois’ ongoing borrowing of COVID-19 relief funds from the emergency Municipal Liquidity Facility operated by the U.S. Federal Reserve, an ongoing surge in Illinois-reported coronavirus cases, and uncertainty over the potential passage by Congress of further relief measures to offer aid to U.S. states.  While lenders are willing to lend money to Illinois, they demand high interest to compensate them for the growing risk of money parked in the Prairie State and its bonds.  

JOBS

Illinois unemployment rate drops in September.  Numbers released on Thursday, October 22 by the Illinois Department of Employment Security (IDES) showed that the statewide jobless count was dropping close to, or below, the widely-tracked 10.0% double-digit benchmark rate in September 2020.  In preliminary numbers, which are subject to adjustment and change, Illinois had a 9.8% unemployment rate in September 2020.  This was significantly worse than the 3.5% adjusted number posted by Illinois twelve months earlier, in September 2019, and the change indicated the effects of the COVID-19 pandemic that has hit Illinois this year.

September 2020 unemployment was significantly  higher in greater Chicago (11.3%) than elsewhere in the state of Illinois.  Downstate metro regions, with an employment profile oriented towards institutions of higher education and teaching hospitals, tended to do better, with Champaign-Urbana posting a jobless rate of 7.0% and the Bloomington-Normal area posting 6.3%.

States adjacent to Illinois tend to have a healthier economy than the Prairie State does, and their activities could be giving a positive pull to three regions of Illinois that are adjacent to Iowa, Missouri, and Wisconsin.  The jobless rate in September 2020 in the Quad Cities region of northwestern Illinois was 7.1%, the same number in the Lake County, Illinois region close to Wisconsin was 7.2%, and the numbers for the Metro-East region adjacent to St. Louis were 7.7% in the same month.

Negative performance review for Illinois Department of Employment Security.  A new study from the independent Better Government Association (BGA) found that the Illinois Department of Employment Security (IDES) was completely unprepared for the flood of more than 2.0 million unemployment claims thus far due to the COVID-19 pandemic and economic downturn.  This lack of preparation affected the experiences of people applying for unemployment insurance benefits.  Many jobless Illinoisans had to wait longer to begin getting assistance checks than did people facing similar waiting times in other states.

A widely-used benchmark goal for UI compliance performance is to see how many UI checks can be mailed out within 7 days of an initial valid application for benefits.  These are days of waiting time during which young adults and families may be needing money to pay rent, utility bills and buy food.  Prior to the COVID-19 crisis, IDES had hit this benchmark with respect to about 80% of initial unemployment claim requests.  However, with respect to IDES in the summer of 2020, only 1% of the beneficiaries could look forward to getting money within seven days.  IDES also failed to meet four of 10 other statistical performance measures gauged and monitored by authorities in the U.S. Department of Labor and other federal agencies.  

Overall, five of 10 of the benchmarks were not met.  Three of these benchmarks track the ability of IDES to detect overpayments that it has already made; detect improper payments that it has already made or is in the process of making; and effective steps to claw back or recover these mistaken payments.

LOCAL GOVERNMENT

Local governments face cash crunch, no money from Springfield.  Illinois’ local governments are expected to largely cover their own fiscal needs.  One of their key revenue streams, sales tax revenues from goods sold in stores and restaurants, has been badly hit by the 2020 coronavirus pandemic.  Their shrinking sales tax revenue has come at the same time as Illinois local governments face mushrooming, unexpected expenses from pandemic-related challenges.  In addition, widespread incidents of public disorder in early summer 2020 created an urgent need for an expanded police presence in many parts of Illinois.   

Illinois localities were not alone in facing these dilemmas.  In March 2020, as part of the CARES Act, Congress appropriated a set of funds meant for distribution to units of local government throughout the United States.  Unfortunately, in a feature of the federal law relatively significant to Illinois, Congress chose to select the state governments to distribute monies going to local governmental units in relatively rural areas away from large cities.  This means that, throughout Downstate Illinois and also within McHenry County, local governments have to ask the State for their share of money from the federal CARES Act. 

The majority party in Springfield, in May 2020, enacted a series of additional hoops and requirements that Downstate local governments would have to fulfill before they could ask for CARES Act assistance.  The Pritzker administration then, by administrative rule, installed even more requirements and controls.  There are now so many rules and requirements in place that very little federal CARES Act money is actually going out to Downstate local governments.     

WEEK IN REVIEW

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