Economic Growth: Business Licensure Website
Governor signs one-stop license website bill co-sponsored by Reps. Keith Wheeler, Robert Pritchard, Steven Andersson, and Grant Wehrli as well as Sen. Karen McConnaughay. The measure, SB 659, directs the Illinois Department of Commerce and Economic Opportunity (DCEO) to create a one-stop “licensure application website” for businesspersons wishing to create new businesses or relocate businesses to Illinois. The General Assembly has directed that information be included on the single website to “walk applicants through” the initial stages of the permit application/license application or applications that may be required for implementation of these job-creation plans. Other states have already set up similar websites.
Gov. Rauner signed SB 659 into law on Friday, July 24, and the new website should be online by July 2017.
Pensions: Public Employees
Attorney General Lisa Madigan signals that SB 1 decision may be appealed to federal Supreme Court. An Illinois Supreme Court decision in early May struck down the 2013 “pension reform” bill, SB 1, and ordered Illinois government officials and taxpayers to cover the entire unfunded costs of pension benefits promised to many Illinois workers in the public sector. These unfunded costs are estimated to exceed $100 billion, and the burden of meeting these costs is one of the elements in the FY16 budget crisis.
The Illinois Supreme Court’s decision was an interpretation of legal language within the Constitution of 1970 that granted explicit contractual protection to pension benefits. While the constitutional interpretation of each state’s constitution is traditionally a subject for the sole jurisdiction of the Supreme Court of that state, some legal scholars believe that the urgency of this issue could grant the Attorney General standing to appeal the 2015 decision to the federal Supreme Court. The Attorney General is in the process of filing a paper asking for additional time to study the issue and possibly file this appeal. Lisa Madigan’s action was described by “Crain’s Chicago Business” on Tuesday, July 28.
DuPage County: Local Government Consolidation
Peter Breen bill abolishes obsolete unit of local government. HB 3747 winds up the affairs of the DuPage County Fair and Exposition Authority. Once-rural DuPage County strongly supports its county fair and, in past years, created an independent authority to operate it. The county’s long-term planning included the farsighted acquisition of a large parcel of property, the County Farm and fairgrounds, much of which was adaptively reused in the late 1980s for the county’s governmental complex and Courthouse Square west of Wheaton.
The DuPage County Fair celebrated its 61st gathering in July 2015. The fairgrounds also serve as a host for other celebration marketplaces and special events throughout the year. As the fairground’s activities diversify, DuPage County fair management has joined other county fairs throughout Illinois in moving towards a joint public-private-sector identity. The DuPage County Fair Association is completing the task of taking over the responsibilities of the Authority, leading to the consolidation of one unit of Illinois local government. With 6,963 units in March of this year, Illinois had more units of local government than any other state in the U.S.
HB 3747 (Breen/Connelly) was signed into law on Wednesday, July 29 by Gov. Bruce Rauner.
State Rep. Barbara Wheeler has filed a resolution to protect military personnel in the wake of last Thursday’s attack on the Recruitment Center and Navy Operational Support Center in Chattanooga, Tennessee. House Resolution 658 calls on the U.S. Congress to act swiftly to enact laws that allow military personnel to be armed for their protection in light of several terror attacks that have been carried out on U.S. military installations in recent years.
“The issue of ensuring the safety of those who protect our nation is two-fold in this day of terrorist threats at home and abroad,” said Wheeler. “We expect our military personnel to be able to defend themselves while overseas, but today they also need to protect themselves at home. For this reason, I have filed a resolution that calls on the U.S. Congress to act quickly to allow our service men and women to protect themselves while serving on home soil.” Read more.
Bryant’s first bill becomes law to protect National Guard members’ jobs. State Rep. Terri Bryant received the Governor’s signature on her first piece of legislation on Tuesday. Back in April, Bryant received unanimous support in the House for HB 3721, a bill designed to help National Guard members keep their jobs. Bryant, whose district shares a border with the state of Missouri, explained the need for the measure.
“When a member of the National Guard is called to duty by their own state’s Governor or by the Governor of a neighboring state, this bill would allow them to categorize their work as military service,” Bryant said. “The addition of a ‘military service’ definition to their work in another state affords members of the National Guard protection that their job will be held for them upon a call up to duty in another state.”
Bryant said that while the change may seem small, it is quite significant for the men and women of Illinois serving in the National Guard. Read more.
FY16 budget stalemate continues in Springfield. As the State of Illinois entered the fourth week of the new fiscal year without a balanced budget in place, there was little if any negotiation in good faith. Instead, a piece-meal approach to the budget crisis continued.
In the House, Democrats again backed a temporary budget to fund certain services at a level that is not sustainable over the course of the entire fiscal year. House Amendment 1 to HB 4143 was adopted by a narrow majority of Democrats, but did not receive enough votes to be passed on Third Reading and was therefore held for future consideration.
The Governor’s Office of Management and Budget believes this plan will ultimately require the expenditure of over $36 billion of GRF taxpayer resources for FY16.
House Republicans continue to stand united in our support for a truly balanced budget that protects the interests of taxpayers, working families and seniors.
The Illinois House was in session last Wednesday and will return tomorrow. The Senate met Tuesday and Wednesday. The Senate has no scheduled return date.
Temporary Budget Work
The Senate concurred with the one-month appropriation bill for “essential services” after the bill was amended to include state worker pay. SB 2040, as amended in the House, cleared the Senate on a vote of 39-0-15. The bill now heads to the Governor, who has stated he will not support a temporary budget.
There are concerns that the one-month budget is based on the Democrats’ budget plan, which includes a $4 billion gap for the full year. Republicans prefer to use the revenue estimate and divide by 12.
Gov. Bruce Rauner believes state government can continue to pay state workers, which would keep state government open for business. Two judges in two jurisdictions in Illinois have ruled on opposite ends: One saying there can be no paychecks without a budget in place; the other ruling that paychecks should be given. The final word on that may come from the Illinois Supreme Court as AG Madigan has asked the high court to immediately take up the measure under the motion of an emergency appeal. In the interim, the Comptroller successfully processed payroll checks for the July 15 payroll.
The Senate voted on a partisan roll call to override the Governor’s veto of five of the nine budget bills that passed in May; SB 2031, SB 2032, SB 2034, SB 2036, and SB 2037. In debate, Senate Pres. John Cullerton characterized these bills as the public safety components of the budget. They will now be sent to the House, which has 15 calendar days once the bills have been read into the record to act on them. At this point it is unlikely the House has the 71 votes needed to override as Rep. Jack Franks has publicly indicated he is still a “no”.
Property Tax Relief
The House took up their weekly property tax bill, which took the form of HA 1 and HA 2 to HB 680. HA 1 was the freeze which was adopted, and HA 2 was the collective bargaining limitations and prevailing wage language. The underlying bill remains on third reading. This is identical to previous proposals HB 692, HB 693 and HB 697.
The Senate took up its own property tax bill, sponsored by Senate Pres. Cullerton. SB 316 as amended would have imposed a property tax freeze for the 2016 through 2018 levy years. The bill also contained provisions dealing with Chicago teacher pension funding and would also have mandated the adoption of a new state school aid formula by sunsetting the current formula effective July 1, 2017. Due to the immediate effective date, SB 316 needed a three-fifths majority and ultimately failed on a vote of 32-0-22.
President Ronald Reagan once said that the nine most terrifying words in the English language are “I’m from the government, and I’m here to help.”
Indeed, what the government may see as a helping hand often winds up being a ham-handed effort to impose its will on America’s job creators, resulting in more harm than good. Such is the case with the Department of Labor’s proposed overtime rule, which the administration claims will extend eligibility for overtime pay to some 5 million workers.
Under current regulations, a worker qualifies for overtime pay if his or her wages for 40 hours of work per week fall below a $23,660 threshold. The proposed rule would more than double that threshold, making employees earning up to $50,440 eligible for overtime when the regulation takes effect in 2016. In addition, this threshold is scheduled to go up each year so that it continues to reflect the 40th percentile of earners.
In this arbitrary and intrusive way, the administration has decided that Washington knows best when it comes to how each job should be classified and how much employees should be paid. And, as usual, the administration fails to consider the impact on employers and the potentially harmful consequences for workers.
Many employers–especially small and midsize businesses–wouldn’t be able to absorb the increased labor and litigation costs. These added costs would mean fewer opportunities for growth and could even result in a curb on hiring. And employees–those who the rule purports to “help”–may gain overtime eligibility, but they are likely to lose hours, health care and retirement benefits, opportunities for advancement, flexible work schedules, and actual income earned. Members of the U.S. Chamber are already saying that to stay in business they will be keeping overall employee compensation at the same level.
Government wage mandates are no substitute for economic growth, and contrary to the administration’s assertions, they do little to lift the middle class. If our leaders want to see hiring accelerate and incomes climb, they should pursue pro-growth policies that enable employers to expand, invest, and create more high-paying opportunities for workers.
That’s why the U.S. Chamber continues to advocate for commonsense regulatory and legal reform, a simplified tax code that lowers rates for businesses and individuals, long-term investment in infrastructure, and policies that will allow the United States to capitalize on its vast energy resources.
In the meantime, we’ll use every tool at our disposal to fight onerous rules and regulations that hurt workers and employers more than they help them.
FY16 Budget Crisis
Democrats continue push for unbalanced, unconstitutional budget. As the State of Illinois entered the second week of its fiscal year without a balanced budget in place, the Democrat majority continued to take a piece-meal approach to the budget crisis.
Democrats again backed a temporary budget to fund certain services at a level that is not sustainable over the course of the entire fiscal year. SB 2040, passed by the bare minimum of 71 partisan Democrat votes in the House Thursday, does not contain one-month spending levels based on the projected FY16 revenue estimate of $32 billion.
The Democrat majority continues to insist on spending levels that are unsustainable. The Governor’s Office of Management and Budget believes this plan will ultimately require the expenditure of over $36 billion of GRF taxpayer resources for FY16. The Democrats’ bill marches the taxpayers of Illinois toward a $4 billion unbalanced budget one month at a time.
House Republicans stand united in our support for a truly balanced budget that protects the interests of taxpayers, working families and seniors.
State Employee Payroll Judicial Proceedings
Three different courts heard the issue regarding state employee payroll this week and by the end of Thursday, there were two starkly different results.
On Tuesday, a Cook County circuit judge ordered that the Comptroller was not allowed to pay the full payroll to state employees without an appropriation. The same order allowed the Comptroller to pay eligible state employees the federal minimum wage pursuant to the federal Fair Labor Standards Act. At the same time, the judge signed off on an agreed order that allowed the Comptroller to expend monies for non-appropriated funds, continuing appropriations, consent decrees and judicial operations.
The Comptroller, CMS and the unions appealed the first court order to the First District Appellate Court. A four judge panel issued a temporary restraining order staying the order to pay employees the federal minimum wage until the Appellate Court is fully able to rule on the appeal. The TRO also barred the Comptroller from paying the full payroll. In essence, the TRO prevents the Comptroller from paying any wages to state employees. The Court also provided for an expedited hearing process and should offer a ruling on the appeal no later than July 20th.
On Thursday, a St. Clair County circuit judge held a hearing on the matter filed by AFSCME and twelve other unions on the same issue of employee payroll. The unions argued that full payroll should be paid, even without an appropriation, because of the Contracts Clause of the Illinois Constitution. The St. Clair County judge, according to media reports, issued a verbal order that allows the Comptroller to process the full payroll for all State employees, based on the inability of the Comptroller to differentiate union employees from non-union employees. The Comptroller’s Office has indicated it will indeed process the full payroll, based on the order. The Attorney General’s Office has indicated it will appeal the order.
Continuing Appropriation for State Workers
Rep. C.D. Davidsmeyer introduces bill to ensure State workers get paid. HB 4245 designates pay for State workers as a “continuing appropriation,” a category that legally outranks the lack of a formal State budget. Enactment of HB 4245 would ensure that State and public university employees would be paid on July 15 and succeeding pay periods throughout FY16.
HB 4245 covers all State agencies, the offices of constitutional officers such as the Secretary of State, State universities, community colleges, and a wide variety of ancillary agencies and offices in which payroll expenses are supported by State appropriations. Many House Republicans co-sponsored HB 4245 and the measure was fully supported by Governor Rauner.
Rep. C.D. Davidsmeyer took to the House floor Thursday to push for a fair hearing on his legislation to ensure State workers continue to receive their paychecks. Unfortunately, House Democrats chose to engage in more hostage-taking, holding up Davidsmeyer’s effort to advance HB 4245 from the Democrat-controlled Rules Committee.
College of DuPage
Bill to Limit Size and Scope of Community College Severance Agreements Heads to Governor. Legislation sponsored by Rep. Jeanne Ives that limits the size and scope of community college buyout packages and severance agreements, and limits the length of employment contracts has passed in the Illinois House and Senate and now moves to the Governor’s desk to be signed.
In response to the $763,000 contract buyout approved by College of DuPage Trustees for President Dr. Robert Breuder earlier this year, Ives carried HB 3593, which would limit the amount of future agreements to no more than one year of salary and benefits. “The agreement that the majority of the COD trustees approved for their underperforming president was excessive and not in the best interest of the taxpayers who fund the college,” said Ives. “I would have liked to have been able to roll back his agreement, but at least moving forward there will be taxpayer protections in place.”
The bill limits employment contracts with a set start and end date to no more than four years with no provision for any automatic rollover clauses. “First, I would like to thank College of DuPage Board President Kathy Hamilton for bringing this to my attention, and Senator Connelly for his help in getting this bill through the Senate,” said Ives.
“Long-term contracts have become problematic in instances where an employee is underperforming and a change needs to be made,” Ives said. “It is important to note that the Senate Democrat Caucus commissioned an investigative report on executive compensation in the State’s Higher Education system that clearly pointed out that compensation, total cost of severance, contract length and tenure needed to be addressed statewide. While more work needs to be done, this legislation is a step in the right direction.”
Ives has been the leading force in the House of Representatives in responding to allegations of malfeasance at the College of DuPage. In addition to HB 3593, Ives was also the chief sponsor of the unanimously-approved HR 55, which directs the Illinois Auditor General to conduct a thorough performance audit of all State moneys provided to the College of DuPage for fiscal years 2007-2014.
Governor Rauner, House Republican Leader Jim Durkin file revised Turnaround Illinois plans. As a signal to voters that the continued Illinois budget impasse only increases the evidence that substantial reforms are needs, Leader Durkin and Governor Rauner worked together this week to refile and re-launch “Turnaround Illinois.” This package of five key reform measures represents movement together fulfilling of the issues platform that the people of Illinois supported in November 2014 when they voted for Governor Rauner.
The planks of the Turnaround Illinois platform filed this week include tort reform (HB 4246); a two-year freeze on Illinois property tax extensions (HB 4247); workers’ compensation reform (HB 4248); term limits for elected State officials (HJRCA 41), and nonpartisan redistricting (HJRCA 42).