121 CRMA Report – October 2017

In this issue

CHICAGO BUDGET ADDRESS
COOK COUNTY BUDGET PREVIEW
CITY COUNCIL UPDATES

CHICAGO BUDGET ADDRESS

Earlier this morning, Mayor Rahm Emanuel delivered his budget address for the upcoming 2018 budget year. Much of the speech focused in on the importance of investing in communities, from using the Neighborhood Opportunity Fund to develop and expand neighborhood retail and restaurant businesses to hiring more police officers and getting them better training, to investing in education and increased local job opportunities for teens and young adults. As for the city’s finances, the Mayor noted that all of the pensions are on a direct path to solvency, that he is balancing the budget without raiding the rainy day fund, selling assets or borrowing money to pay off existing loans. Through tough negotiations, the city has been able to keep its healthcare costs relatively flat and decreased its structural deficit since the Mayor’s been in office by 82%. He highlighted how important it was to eliminate the head tax during his first term, and announced that unemployment over the last six years has been cut in half.

The city’s $9 billion budget for 2018 will build on these successes but will not be without some additional revenue. The next installment from the previously approved increases in the property tax will hit next year as well as an increased amusement tax for large venues. Ride share fees will also increase in order to tackle public transportation modernization and address lost revenue from the parking garage tax and the flailing taxi industry. Outside of the previously scheduled property tax increase, the retail and restaurant industry should be able to survive next year’s budget largely unscathed. This will give us some time to figure out how to adjust to the next increase in the minimum wage, find ways to address the complexities of the paid sick leave and FMLA ordinance and prepare for any additional proposed regulations on the workforce.

The departmental budget overview will kick off on Monday, October 23rd with a public hearing on the budget scheduled for Wednesday, November 8th directly after the City Council meeting. CRMA will attend all departmental hearings that affect the retail industry and continue to update you on the budget process. All relevant budget documents can be found here.

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COOK COUNTY BUDGET PREVIEW

Cook County Board President, Toni Preckwinkle, issued her annual budget recommendation prior to the vote on the sweetened beverage tax (SBT) repeal. The $5 billion budget for 2018 originally included $200 million in revenue from the SBT. Before the vote to repeal the tax, President Preckwinkle warned each department that they would have to find 11% in cuts in their departments to make up the “lost” revenue. It is hard to imagine how in a $5 billion budget, a lost $200 million would necessitate cuts that deep, but it made headlines. Now that the SBT repeal vote is over, and the tax will actually be repealed on December 1, 2017, the Finance Chairman is asking each department to find 10% in cuts to kick off actual budget discussions.  

It is clear from the speeches made during the SBT repeal vote that Commissioners will be looking for ways to make the county leaner and more efficient before pursuing another tax. With 85% of the voters in Cook County expressing their opposition to the SBT, and frankly, to more taxes, Commissioners have their marching orders. They must find ways to maintain essential services, collaborate with the city of Chicago to save money and consolidate. The days of telling taxpayers that the County needs more revenue from them in order to survive, and then turning around and approving generous pay raises, increased benefits and future step pay increases are over. The taxpayers want a proper accounting for how the money is spent and for how the County plans to hold the line on spending. Employers want the same thing.

The County will be engaging in meetings through mid-November to hear from each department on how it plans to make cuts and increase savings. The budget will be adjusted throughout this process until a compromise is reached. Generally the County issues its budget before the Thanksgiving holiday, but this year, it may extend that process. Depending on how negotiations proceed, the County could issue its budget in February which is allowed by state law. We will keep members informed on the progress.

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CITY COUNCIL ORDINANCES AND RESOLUTIONS

INTRODUCTIONS

ORDINANCE – BAN ON REFUSING CASH AS PAYMENT FOR GOODS/SERVICES

Sponsors: Alderman Edward M. Burke (14th Ward) and Alderman Walter Burnett (27th Ward)

Committee: License and Consumer Protection

A recent Chicago Tribune article highlighted the “trend” of some retailers and restaurants moving away from allowing customers to pay with cash and instead only accepting card and mobile payments. The proposal cites concerns with escalating credit card balances and unnamed studies that suggest that when consumers pay with credit cards they are more likely to spend more. It also refers to a promotion offered by VISA that offered financial rewards to restaurants that met its “Cashless Challenge” by converting exclusively to cashless transactions. The proposal suggests that going cashless is a ploy to help enrich credit card companies while giving merchants access to consumer data with every swipe of the card. This data, according to the proposal, can then be susceptible to a breach, or it can be shared/sold for marketing purposes.

The proposal continues on to suggest that cashless transactions have a disproportionate effect on children under the age of 18 who are unable to apply for credit cards, as well as undocumented immigrants, the homeless and low-income consumers who are un-banked or under-banked. As evidence of this trend, the proposal names several restaurant chains where the price of a cup of tea can run $4.00 and a salad or sandwich averages $10.00. Hardly a place where the homeless or customers on a fixed income are frequenting.

Suggesting that this is a solution in search of a problem, the only other jurisdiction that has passed a law requiring merchants to pay with any acceptable form of legal tender is Massachusetts. That law was passed in 1978, prior to the internet being invented.

CRMA is currently developing its position on this matter.

 

ORDINANCE – EMPLOYEE DISCRIMINATION

Sponsors: Alderman Gilbert Villegas (36th Ward) and Alderman Carlos Ramirez-Rosa (35th Ward)

Committee: Human Relations

This proposal would prohibit employers from discharging, or otherwise discriminating against, an employee for changing or attempting to change their name, SSN or federal employment authorization document. It is unknown at this time if this is related to the city developing its own ID card for use with city services, but this section is being added to that section of the Municipal Code.

CRMA is currently developing its position on this matter.

 

ORDINANCE – ELECTRICAL CODE AMENDMENTS

Sponsor: Mayor Rahm Emanuel

Committee: Zoning, Landmarks and Building Standards

Most of the changes made here are not substantive and look like an attempt to clean up some of the Code and ensure that the correct citations to other parts of the Code are noted by reference. There is new language governing branch circuits, feeders, PVC, RTRC, luminaires, lampholders and lamps. Please ensure that persons in control of your building operations review the changes.

CRMA takes no position.

 

ORDINANCE – ENERGY PERFORMANCE RATING SYSTEM

Sponsor: Mayor Rahm Emanuel

Committee: Zoning, Landmarks and Building Standards

This proposal would set in place an energy performance rating system for covered buildings which assigns stars based on performance. A four star rating would be the highest and zero being the lowest. Buildings would be provided their rating on an annual basis and must disclose their score in any advertisement to sell the building. Water usage information could be made readily available to the public.

CRMA takes no position at this time. Please let us know if you have concerns.

The next City Council meeting is scheduled for Wednesday, November 8, 2017.

The next Cook County Board meeting is scheduled for November 15, 2017.

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Tanya TricheTanya Triche Dawood
Vice President, General Counsel
IL Retail Merchants Association
312-726-4600
ttrichedawood@irma.org