This Week in Springfield – 99-29

This Week in Springfield the Senate was in session while the House remained adjourned with members back in their districts for the March 15th primary.

 FEMININE HYGIENE PRODUCT TAX

Senator Melinda Bush  (D-Grayslake) introduced SB 2746 that would eliminate the tax on feminine hygiene products and incontinent products.  Currently, Maryland, New Jersey, Minnesota, Maine and Pennsylvania specifically exempt feminine hygiene products from taxation while Hawaii, Montana, Oregon, New Hampshire and Delaware do not have a sales tax and therefore these products are not taxed.

While Senator Bush seeks to enact a consistent state change by working with the Department of Revenue and other stakeholders, the City of Chicago is seeking to reclassify feminine products as “medical appliance” by ordinance so that the products may be taxed at a lower rate. Chicago is basing its position on a 1990 Illinois Supreme Court case where the court ruled that tampons and pads met the state’s definition of “medical appliances” and were exempt from a sales tax imposed by the city. The state subsequently narrowed the exemption and feminine hygiene products were, once again, taxed at the full rate. Although, both the state and the city are looking to achieve the same goal, it is clear that the state has the sole authority to reclassify a product for tax purposes and therefore Chicago is prohibited from doing so without state action.

IRMA wants to thank Senator Bush for reaching out to stakeholders regarding this issue. While IRMA is neutral on the issue, IRMA supports any change at the state level where the tax can be administered effectively, consistently and legally by the Illinois Department of Revenue rather than potentially unlawful reclassification at the local level.

BUSINESS JUMPSTART ACT TAX

Senator Mattie Hunter (D-Chicago) filed an amendment to SB 259 that would require every business in Illinois to pay a tax to fund a new program called the Business Jumpstart Program.  The program would be implemented by the Illinois Department of Employment Security (IDES) and is designed to “support economic growth and enhance employment opportunities for persons who are unemployed, veterans seeking jobs, unemployed persons whose benefits are expiring, graduates from school, and others who are entering the workforce”. The program would be funded by a tax on any Illinois business that employs two or more individuals. Specifically, business would be required to pay a fee of no less than $500 and no more than $1,000 to IDES. In return for the tax, employers will have the opportunity to select from pre-screened candidates for pre-probationary on-the-job training with wage support during the training where a third party intermediary is the time-limited employer of record prior to employment.

 BUSINESS DAY SPEAKER

We are happy to announce that the keynote speaker at the opening luncheon of Business day on May 11th will be Amy Walter. Known as one of the best political journalists covering Washington, she is the national editor of the Cook Political Report and the former political director of ABC News. From 1997–2007, Walter had previously served as senior editor of the Cook Political Report. She is also an exclusive panelist on NBC’s Meet the Press and a regular panelist on PBS’ Washington Week with Gwen Ifill and Fox News’ Special Report with Bret Baier. She also provides political analysis every Monday evening for the PBS NewsHour.

We look forward to her presentation and TWIS readers’ participation in this Business Day2016.

Register Today for Business Day 2016 on May 11th.

 

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This Week in Springfield 99-28

99-28

EGG LOT CONSOLIDATION
ELECTRONIC MONITORING
BUDGET BATTLE
ILLINOIS ECONOMIC FORECAST
SENATE PASSES AFSCME ARBITRATION BILL
HOUSE PASSES CHICAGO ELECTED SCHOOL BOARD LEGISLATION

This Week In Springfield, the record-setting budget battle continued while both chambers began committee work in earnest.

EGG LOT CONSOLIDATION

An IRMA initiative to modernize Illinois’ egg laws to reduce waste advanced out of committee 7-1.  HB 6287 (Rep. Elaine Nekritz, D-Buffalo Grove – Rep. Peter Breen, R-Lombard – Rep. Robert Martwick, D-Chicago – Rep. Robert W. Pritchard, R-Sycamore) includes extending the current 30 day sell/use by date for eggs to 45 days mirroring the practice in 43 other states and the recommendation of the USDA. Additionally, HB 6287 implements an egg consolidation program that will allow retailers to remove a bad egg from a carton and replace it with an egg from the same brand that is inspected, graded, sized and dated at the same time within the same lot, rather than throw away the whole carton as currently required in Illinois.  It is estimated that one in every 10 dozen eggs is thrown out which equals roughly 5 billion eggs annually. Moreover, the USDA has reported that consumers throw out another 23% of all eggs due to the expiration data.

Egg lot consolidation is practiced in 41 states and approved by the USDA. Currently, this means that while retailers in surrounding states can save good Illinois eggs through egg lot consolidation, retailers in Illinois are required to discard good Illinois produced eggs. While some Illinois egg producers support the legislation, others do not. In response to these concerns, an amendment includes a farmer-opt provision that will allow any Illinois egg producer to prohibit its brands from being consolidated in Illinois—no other state provides an exemption for its in-state producers. Additionally, the legislation requires mandatory retail employee training and retail recordkeeping requirements.

With the amendment, the Illinois Department of Agriculture and Illinois Department of Public Health are neutral.  The legislation passed out of the Judiciary Civil Committee by a vote of 7-1-0. IRMA would like to thank the following representative for supporting the measure in committee: Rep. Elaine Nekritz, Rep. Peter Breen, Rep. Steve Andersson, Rep. Ann Williams, Rep. Ron Sandack, Rep. Pamela Reeves-Harris and Rep. Robert Martwick. HB 6287 now proceeds to the floor for consideration by the full House sometime after they return on April 4th.

ELECTRONIC MONITORING

HB 5794 (Rep. Christine Winger, R-Bloomingdale) would prohibit the use of monitoring software/devices that would track the user of the software without the consent of all owners of the device.  This would be a criminal offense.  The bill is attempting to target incidences of domestic violence when the abusive partner uses software to track the abused partner to a shelter or other safe space.  Unfortunately, the bill is written in such a way that would prohibit retailers from using technology to market to customers as they are in our stores or on our property.  This technology helps retailers give customers the personalized experience that they desire.  IRMA believes that with some changes to the language, the bill could better target illegal activity while still allowing businesses to create the type of individualized store experience consumers demand.

The bill received a subject matter hearing with IRMA testifying in opposition.  It is likely that the negotiated language of this bill will be included in a larger bill that addresses other changes to the Criminal Code.  The sponsor agreed to hold HB 5794 pending an agreed amendment.  IRMA would like to thank Rep. Winger for taking the concerns of retailers into account and working with us on this important issue.

BUDGET BATTLE

TWIS readers are aware that Illinois is in the ninth month of the 2016 fiscal year with no budget resolution in sight. The debate continued unabated this week on at least two major fronts.

Map Grants

The Monetary Award Program (MAP) provides grants, which do not need to be repaid, to Illinois residents who attend approved Illinois colleges and demonstrate financial need, based on the information provided on the Free Application for Federal Student Aid (FAFSA).  Absent a state budget and subsequent MAP grant funding, some colleges covered MAP funding for thousands of students during the fall semester but without state funding may not be able to continue to do so.

SB 2043 (Sen. John J. Cullerton, D-Chicago/Rep. Kelly M. Burke, D-Oak Lawn) sought to appropriate over $700 million to fund tuition grants for low-income students. This included spending $397 million for the income-based MAP and $324 million to help finance community colleges.  Governor Rauner subsequently vetoed the legislation. In his veto message he concluded that SB 2043 proposed the same funding levels for these programs as were included in the unbalanced budget passed by the General Assembly in which he vetoed. He argued that without a budget no revenue stream existed to fund the appropriation and would significantly exacerbate the State’s current cash flow challenges.

The Senate overrode the Governor’s veto by a 37-17-0 vote. However, the House vote fell two short of the 71 required for an override—69-48-0.

Higher Education and Human Services Grants

HB 2990 (Rep. Michael J. Madigan, D-Chicago/Sen. John J. Cullerton, D-Chicago) and HB 648 (Rep. Barbara Flynn Currie, D-Chicago/ Sen. John J. Cullerton, D-Chicago) passed the House by a 70-43-1 vote and 61-52-0 vote respectively. Together, these bills appropriate more than $3.7 billion in funding for higher education and human service grants that include but are not limited to autism, Meals on Wheels, mental health, etc. The legislation also provided $450 million in revenue to pay for the spending by forgiving previous borrowing from special state funds. All but one Republican lawmaker voted against the bills dismissing both pieces of legislation as piecemeal legislation that will add another $3 billion in debt to a budget that already includes $7.4 billion in backlog debt.

ILLINOIS ECONOMIC FORECAST

This week, the Commission on Government Forecasting and Accountability (COGFA released an unfavorable economic forecast for Illinois. COGFA’s forecast was gloomy and stated that “Illinois’ economy is the weakest of the underperforming Midwest. Poor public sector finances, an ailing downstate economy, and deteriorating demographics are hampering the state’s recovery. Job growth has run at less than half of the national average in 2015, and the payroll survey actually showed a year-over-year decline in December. Consequently, the unemployment rate has made a U-turn and is barely below year-ago levels in most metro areas.”

COGFA also released its FY17 Revenue Estimate that is usually used as a budget estimate for lawmakers to negotiate and craft a budget.  Illinois is estimated to generate little more than $31 billion in the next year. This fiscal outlook includes a gloomy 2.0 percent growth from personal income taxes and a 1.5 percent growth in corporate income tax receipts.

COGFA’s study was compiled by Moody Analytics. COGFA is a bi-partisan legislative commission created to provide the members of the Assembly with information on Illinois’ economy and government finances.

SENATE PASSES AFSCME ARBITRATION BILL

On a vote of 38-17-0, the Senate passed HB 580 (Rep. Emanuel Chris Welch, D-Westchester/Sen. Don Harmon, D-Oakpark) which would force AFSCME negotiations with the Rauner administration into binding arbitration as a result of any impasse. AFSCME represents the vast majority of unionized state workers. HB 580 is nearly identical to SB 1229 (Sen. Don Harmon, Oak Park/Rep. Mike Smiddy, D-Port Bryon) that Governor Rauner vetoed in July and the House failed to override the veto by three votes in September.  In his veto, the Governor argued that the binding arbitration removes every subject of labor negotiations from the bargaining process and allows unelected arbitrators to impose billions of dollars of new costs on taxpayers without any involvement of the Executive Branch, the General Assembly, or those taxpayers.

Despite the failed override attempt in September, HB 580 was introduced and passed in the Senate. The bill was sent to the House but was not addressed before the House adjourned. The House will not return before for the March 15th primary.

HOUSE PASSES CHICAGO ELECTED SCHOOL BOARD LEGISLATION

House lawmakers overwhelmingly passed legislation that would require Chicago Public Schools to have an elected school board. Currently, Chicago is the only municipality in Illinois without an elected school board. HB 557 (Rep. Robert Martwick, D-Chicago) passed the House 110-4 and would subdivide Chicago into 20 electoral districts and require a non-partisan election of the Chicago Board of Education at the general primary election in 2018.It is unclear whether the legislation will continue in its present form in the Senate.

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This Week in Springfield – 99-27

 

Governor Rauner’s Budget Address

 

Citing a need for tough choices now to change a historical tax and spend cycle, and against the backdrop of a crisis fiscal situation, Governor Bruce Rauner delivered his second annual budget address Wednesday to a joint session of the General Assembly.

IRMA members are aware that an eight month impasse over the fiscal 2016 budget has pushed Illinois $6.2 billion deeper into debt. With revenue down $5 billion due to the January 1, 2016 sunset of the temporary income tax rates imposed during the Quinn Administration in 2011, and courts requiring some health and social service spending at fiscal 2015 levels or higher, the impasse is eroding Illinois’ already deteriorating finances. It is estimated that Illinois’ bill backlog will grow from $5 billion currently to as much as $10 billion when fiscal 2016 ends on June 30th. During the eight month impasse, the Governor has continued to push for reforms before he will entertain increased taxes for the budget. Democrats who have super-majority control of the Assembly have resisted the Republican governor’s proposed Turnaround Agenda and Transformation Agenda.

According to the Governor’s budget staff, his proposed budget totals $36.3 billion with current revenues expected to only be at $32.8 billion leaving a $3.5 billion budget deficit. Governor Rauner seeks to achieve a balanced budget through one of two paths that he proposed to lawmakers. The first path consists of negotiating portions of the structural reforms he is proposing in his Turnaround and Transformation agendas coupled with cuts in spending and new revenue. The Governor’s preferred option includes some of his previously stated reforms that have evolved to now encompass pension, workers compensation and redistricting reform; term limits and property tax relief.  He continues to seek these structural reforms before any new revenue is proposed, but he stated that he is open to compromise on his agenda.

Absent agreement on his proposed structural reforms contained in the first option, Governor Rauner insisted that he would make the necessary $3.5 billion in cuts to balance the budget if lawmakers gives him the authority to do so through the “Unbalanced Budget Response Act”. This second path includes granting him unprecedented executive authority to unilaterally make billions in cuts to programs including withholding pension payments, sweeping funds, lowering reimbursements, etc.  No specific budget cuts, revenue sources or taxes were identified in the speech but it would clearly be painful for all as he would need to cut several billion to bring spending in line with revenue.

Reaction to the speech fell along party lines with Republicans praising it and Democrats panning it. Democrats labeled it more of the same and criticized it for lack of specifics. Senate President

John Cullerton noted that the Governor could simply reduction veto whatever budget the Assembly decides to send him. Speaker Michael Madigan characterized the address as a budget without a budget citing lack of details.

IRMA released the following response immediately after the speech: IRMA applauds Governor Rauner’s evaluation of the current status of Illinois’ fiscal and economic situation and the challenges we face. No one believes raising taxes alone, or cutting alone, will address the problems confronting Illinois. However, retailers across Illinois are operating on razor thin margins and we cannot afford additional regulations or mandates on the city or state level that inhibit our ability to survive let alone grow. As it always has, IRMA stands ready to work with all parties on crafting an agreement that will stabilize Illinois’ fiscal situation and move Illinois forward economically for years to come.

At this writing, it would appear that Illinois will continue on its current path for the foreseeable future – quite possibly until after the November elections.

FY 17 Medicaid Funding

Following the Governor’s Budget Address, a joint Health and Human Services briefing was held to present a brief overview of their FY 17 proposed budget. As you may recall, last year the Governor proposed $1.5 billion in cuts to Medicaid which included significantly reduced dispensing fees for pharmacy. In the absence of a budget the State of Illinois, and pursuant to court-imposed consent decrees, the state continues to pay all Medicaid all providers for services rendered, including pharmacies.

The briefing echoed the State of the State Address where the Governor outlined a new path for human service agencies. Specifically, the transformation puts a strong new focus on prevention and public health; pays for value and outcomes rather than volume and services; makes evidence-based and data driven decisions; and moves individuals from institutions to community care, to keep them more closely connected with their families and communities. Fiscally, the Department of Health and Family Services, which includes Medicaid, is asking for an appropriation of $22.127 billion. This is a $770 million increase from last year of which $677 million will come from the General Revenue Fund (GRF). If the Governor’s first path is chosen, Medicaid will not be impacted. However, if the Governor’s second path is chosen, we would anticipate significant reductions to already low Medicaid pharmacy reimbursements. As always, the budget process is fluid and IRMA will remain vigilant regarding these important issues.

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This Week in Springfield – 99-26

In this Issue:

PRESIDENT OBAMA
VENDOR COLLECTION ALLOWANCE
BUDGET ADDRESS PREVIEW
LEGISLATIVE INTRODUCTIONS

This Week In Springfield

This Week In Springfield the President of the United States Barack Obama spoke to the Illinois General Assembly about political civility; Representative Jack Franks legislation to reduce the vendor collection allowance, among other provisions,  was posted to a committee but was not called for a hearing; and the Governor prepares for his Budget Address next week.

President Obama

On the nine year anniversary of his speech upon the Old State Capitol steps announcing his Presidential bid, President Obama returned to Springfield to address a Joint Session of the Illinois General Assembly where he had served as a State Senator from 1997 until his election to the US Senate in 2004.  It was the first time a sitting President addressed the General Assembly since President Jimmy Carter in 1978. The theme of the speech was to “build a better politics” where civility and patience outweighs extreme partisan posturing so that common ground can be found amid polite discourse.

The President’s message of political civility comes at a time when Illinois is entering its 8th month without a budget and both parties are gearing up for contentious March primaries and November general elections. As such, the President offered both parties talking points for the upcoming election. The President reiterated his support for redistricting but fell short of addressing term limits. He reminded the audience that he is a progressive Democrat who supports collective bargaining, minimum wage increases, campaign finance reform and voter registration reform. The President proclaimed that despite the continuous deadlock in Washington, and by inference Illinois, he “still believes in the politics of hope.”

President Obama finished his Springfield visit by hosting 250 of his friends at the Hoogland Center for the Arts.

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Vendor Collection Allowance

As TWIS readers are aware, during the summer, Representative Jack Franks, (D-Woodstock) filed HB 4300 seeking to impose over $2 billion in tax increases primarily on Illinois employers. Most egregiously, his proposal includes reducing the vendor collection allowance which is a partial reimbursement for the expenses retailers experience for administering and collecting the sales tax on behalf of the state and units of local government. One of the other more egregious provisions would impose a 1% tax on every health insurance claim.  In response, IRMA and the Illinois Manufacturers’ Association (IMA) informed voters of the negative impacts of this proposal. HB 4300 has been posted to the House Revenue and Finance Committee where it could be heard at any time.

IRMA is actively opposed to HB 4300 and continues to educate members of the Assembly as to the truth underlying the vendor collection allowance as well as the negative impact of many of the other provisions.

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Budget Address Preview

On the heels of the State of the State Address on January 27th, Governor Bruce Rauner will be presenting his much anticipated Budget Address next week. This address comes at a time when the impasse over Illinois’ fiscal 2016 budget has stretched into the eight month and has pushed Illinois $6.2 billion deeper into debt. With revenue down $5 billion due to the January 1, 2016 sunset of the temporary income tax rates imposed during the Quinn Administration in 2011, and courts requiring some health and social service spending at fiscal 2015 levels or higher, the impasse is eroding Illinois’ already deteriorating finances. It is estimated that Illinois’ bill backlog will grow from $7 billion currently to as much as $12 billion when fiscal 2016 ends on June 30th. The Governor has continued to push for reforms he believes are necessary to ensure Illinois doesn’t continue to simply tax-and spend before he will entertain a tax increase for the budget.

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Legislative Introductions

This week was the deadline for House bill introductions. As such there has been a flurry of new introductions this week. Below is a snapshot of initiatives that will have a direct impact on retail.

LABOR

Workplace PrivacyHB 4999 (Rep. Will Guzzardi, D-Chicago) makes it unlawful for an employer or prospective employer to (1) request or require an employee or applicant to authenticate or access a personal online account in the presence of the employer, (2) to request or require that an employee or applicant invite the employer to join a group affiliated with any personal on line account of the employee or applicant, (3) or join an online account established by the employer. Additionally, it prohibits retaliation against an employee or applicant.

Employee Sick LeaveHB 6162 (Rep. Andrew F Skoog, D-Spring Valley) creates the Employee Sick Leave Act and provides that employees may use personal sick leave benefits provided by the employer for absences due to an illness, injury, or medical appointment of the employee’s child, spouse, sibling, parent, mother-in-law, father-in-law, grandchild, grandparent, or stepparent, for reasonable periods of time as the employee’s attendance may be necessary, on the same terms upon which the employee is able to use sick leave benefits for the employee’s own illness or injury.

REGULATIONS

Retail TheftHB 6192 (Rep. Michael J. Zalewski, D-Riverside) relaxes the penalties for retail theft by increasing the threshold for enhanced penalties. Specifically, it increases the threshold amounts for enhanced penalties for theft (from over $500 to over $1,000) and for retail theft (from over $300 to over $500). Additionally it provides that enhanced penalties for theft and retail theft apply to third or subsequent convictions rather than for second or subsequent convictions.

Animal Abuse RegistryHB 5005 (Rep. Christine Winger, R-Bloomingdale) requires the Department of Agriculture to create and maintain an Animal Abuse Registry that is funded by an Animal Abuse Registry Fund. Any person 18 years of age or older that has been convicted of cruel treatment, aggravated cruelty, or animal torture shall register with the Department of Agriculture within 30 calendar days after the date of conviction to be placed on the Animal Abuse Registry. The registry will be publicly accessible. The bill also prohibits a registered person from owning a companion animal or being employed at an animal shelter, pound, pet shop, zoo, or other business where companion animals are present.

Biometric Data CollectionHB 6025 (Rep. Sam Yingling, D-Grayslake) provides that except to the extent necessary for an employer to conduct background checks or implement employee security protocols, a private entity may not require a person or customer to provide his or her biometric identifier or biometric information as a condition for the provision of goods or services. The new provisions do not apply to: (i) companies that provide medical services; (ii) law enforcement agencies; or (iii) governmental entities.

PHARMACY

Medicine Locking BottleHB 5949 (Rep. Mike Zalewski, D-Riverside) would extend the medicine locking bottle pilot program from 2017 to 2018.  The original legislation created a pilot program where pharmacies had the option of use a prescription locking bottle for new or refilled Schedule II prescription that contains hydrocodone. The legislations funding is subject to appropriation and is aimed at supporting one company.

Pharmacy Dispensing Error MandateHB 6180 (Rep. Michael P. McAuliffe, R-Chicago)requires pharmacies to establish and maintain a quality assurance program designed to prevent dispensing errors as well as a process designed to detect and identify dispensing errors. It also requires pharmacies to commence an investigation into any detected dispensing errors within 2 days after the date the dispensing error is discovered. Requires that if an investigation into a dispensing error indicates that the dispensing error is attributable, in whole or in part, to the pharmacy or its personnel, that a quality assurance review be performed. Provides requirements for the quality assurance review and its records. Provides that the records of the quality assurance review shall not be subject to discovery in any arbitration, civil, or other proceeding, except in certain circumstances. Effective 12 months after becoming law.

TOBACCO

E-Vaping – HB 2404 (Rep. Kathleen Willis, D-Northlake) originally banned e-vaping indoors everywhere cigarettes are prohibited.  She has amended the bill to ban e-vaping in schools/child care centers as well as government buildings only.

“Beer Garden” Smoking ClarificationHB 5029 (Rep. Dwight Kay, R-Edwardsville) provides that smoking is allowed in facilities (such as outdoor beer gardens, patios, decks, etc.) constructed prior to August 14, 2015 for the purpose of compliance with the Act. It requires that such facilities have signs clearly stating that the building or area is used for smoking.

E-Cigarette Marketing LimitsHB 6026 (Rep. Kathleen Willis, D-Northlake) limits the advertising and marketing of electronic cigarettes and electronic cigarette liquids targeted at persons under the age of 18 by manufacturers and retailers of such products. It also discontinues and prohibits the outdoor advertising and transit advertising of electronic cigarettes and electronic cigarette liquids by manufacturers and retailers of such products.

FOOD

Egg Lot ConsolidationHB 6287 (Rep. Elaine Nekritz, D-Buffalo Grove) provides that no eggs may be offered for sale for consumer use 45 days or more after candling (rather than after the original 30-day candling date). It extends the expiration date labeling requirement for grade A and AA eggs to no later than 45 days after candling. Additionally, it provides that eggs may be repackaged only when the retailer performs a lot consolidation where the lot consolidation is performed by or under the supervision of a registered lot consolidator. It requires that eggs be consolidated in a manner consistent with the specified training, every lot consolidation shall be documented using an Egg Lot Consolidation Log form, and that registered lot consolidators shall work at one physical location only.

Meat Labeling ActHB 5526 (Rep. Mike Smiddy, D-Port Byron) creates the Meat Labeling Act and requires that any person selling meat in this State must package the meat with a label indicating the country in which the meat was produced.

Local Food Scrap MandateHB 6029 (Rep. Carol A. Sente, D-Vernon Hills) requires that county waste management plans shall include a food scrap composting program. The program shall provide for separate collection and composting of leaves and food scrap, shall include a report to the Environmental Protection Agency about the capacity and availability of food scrap composting infrastructure in or near the county, and shall include a plan for access to food scrap composting by all county residents within 5 years.

ENVIRONMENT

Plastic Bag Recycling—SB 2224 (Sen. Terry Link, D-Gurnee) creates the Plastic Bag and Film Recycling Act and has been assigned to the Environment and Conversation Committee. It requires manufacturers of plastic carryout bags to register with the Illinois Environmental Protection Agency and pay to the Agency an initial registration fee and annual registration renewal fee. It prohibits a manufacturer from selling or offering to sell plastic carryout bag in the State unless the manufacturer is registered with the Agency and its name is printed on the plastic carryout bags it manufactures. Additionally, it requires each manufacturer to develop, and submit to the Agency, a plan to support the collection and recycling of plastic carryout bags and plastic film product wrap and prohibits retailers from purchasing plastic carryout bags from manufacturers under certain circumstances.

Coal Tar BanHB 5578 (Rep. Laura Fine, D-Glenview) prohibits the sale and use of a coal tar sealant product in the State of Illinois. Specifically, it prohibits the application of a coal tar sealant product on any surface, except for highway structures, in the State of Illinois including but not limited to a driveway, parking area, playground, sidewalk, bike trail or roadway.  It also allows a city or county to adopt an ordinance to enforce the requirements of the legislation in prohibiting the sale of coal tar sealant.

TAXES

Consumption Gross Receipts TaxHB 6208 (Rep. Carol Ammons, D-Champaign) requires when a retailer who is engaged in the business of selling seeds or plants sells those seeds or plants to a purchaser who uses the seeds or starter plants in raising lawn grass, vegetables, fruits, nuts, crops, or other plants which they will use or consume and not resell, those retailers are engaged in the business of selling tangible personal property to purchasers for use or consumption and are required to remit the tax imposed under the Act on those gross receipts. Requires a retailer who sells seeds or plants to a purchaser who uses those seeds or plants in raising vegetables, fruits, nuts, crops, or other plants for sale is selling those seeds or plants to purchasers for purposes of resale and is not required to remit the tax imposed under the Act on those gross receipts.

Retail Property AssessmentHB 6240 (Rep. Michael P. McAuliffe, R-Chicago) provides that, for the purposes of the definition of 33 1/3%, the fair cash value of property is determined by the lesser of: (1) the Department of Revenue’s sales ratio studies for the 3 most recent years preceding the assessment year; or (2) the valuation of the property in the year immediately preceding the assessment year (under the current law, the fair cash value is based on the sales ratio studies).

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This Week in Springfield – 99-25

This Week In Springfield, Governor Bruce Rauner presented the annual State of the State Address and the Illinois Senate assigned a plethora of bills to standing committees.

State of the State Address

In the midst of budget standoff that has lasted over seven months, Governor Rauner delivered Illinois’ annual State of the State address Wednesday. During the address, the Governor briefly touched upon his administration’s accomplishments in his first year in office which they believe saved Illinois $938 million. According to the Governor, these savings were achieved by reducing state spending by $500 million; saving $188 million through unemployment insurance fraud reduction; and saving $250 million through reforms within the Department of Healthcare and Family Services. The Governor also touted implementing a revolving door ban on state officials becoming lobbyists and reforming the EDGE credit to eliminate special deals.

The Governor noted that in order to improve the quality of life for all residents, Illinois needs to increase the economic opportunity for all individuals. This requires excellent education and vocational training combined with multiple career opportunities made available by companies competing to hire workers.  The Governor stated that despite the natural benefits that Illinois has to offer, including economic and strategic viability, Illinois is failing its citizens by promoting an economic status quo that benefits politicians, trial attorneys and unions at the expense of the middle class. This failed economic policy forces people and businesses out of Illinois which exacerbates the middle class deterioration while depleting the state of much needed taxes dollars that could be used to promote and protect infrastructure and programs for the most vulnerable citizens.  The Governor’s proposal to address these problems is his Turnaround and Transformation agendas.

TWIS readers are well informed of the Governor’s “Turnaround Agenda” that has evolved from a long list to now encompass workers compensation and redistricting reform; term limits and property tax relief. During the State of the State, the Governor introduced a new agenda labeled the “Transformation Agenda”. This agenda focuses on many new initiatives.  The Governor unveiled a 10 point education reform plan that he believes will produce a high quality fully integrated  education from cradle to career that will eliminate bureaucracy and hold schools accountable for results.  His administration is also working to transform a broken health and human services system that relies on a “broken patchwork of reactive, expensive, and ineffective interventions”, by focusing on “evidence based and data driven decisions” coupled with “value and outcome rather than volume and services”. The administration plans on streamlining and updating the Illinois’ antiquated IT system through a new executive agency dubbed the Department of Innovation and Technology. Additionally, the administration plans to reform the Illinois’ procurement procedures which he believes will save the state $500 million a year. Unlike the Turnaround Agenda, the Transformation Agenda appears to include some initial bipartisan agreement. This includes 14 criminal justice reform ideas suggested by a bipartisan Criminal Justice Reform Commission and the Governor’s support for a pension reform proposal crafted by Senate President Cullerton that will save Illinois $1 billion a year.

The Governor’s speech was not without a verbal barrage against primarily public sector unions, particularly AFSCME with whom his administration is in heated contract negotiations.  The Governor took the opportunity to chide AFSCME for demanding $3 billion in increased benefits while schools and the most vulnerable citizens of Illinois are suffering.  Additionally, the Governor promised to reform unfair work rules that he believes the unions have abused and that have created hidden costs at the expense of Illinois’ taxpayers.

In closing, the Governor admitted that the last year was difficult but wants to build off the bipartisan progress that resulted in Criminal Justice Reforms, Police Reforms, and Unemployment Insurance changes to jumpstart mutual participation to achieve a grand compromise to move Illinois forward.

As is always the case, immediately after the State of the State, each caucus leader spoke to the media. Senate Republican Leader Christine Radagno and House Republican Leader Jim Durkin made it clear that Illinois requires the structural reforms contained within the Governor’s Turnaround and Transformation Agenda rather than relying on just raising taxes. They echoed the Governor’s belief that raising taxes without real institutional reform will continue Illinois’ political, structural and financial downward spiral.  House Speaker Michael Madigan organized some human service program advocates to present their concerns regarding the lack of a state budget to the media during his press conference.  Speaker Madigan reiterated that he is willing to work with the Governor, but he believes that discussions should only include budget matters and he has doubts about the Governor’s sincerity of bipartisanship when he continues to advocate for changes that are in direct conflict with Democratic Caucus core principles. During the State of the State, Governor Rauner trumpeted his tentative bipartisan agreement to support Senate President John Cullerton’s pension proposal. In somewhat of a surprise development, the Senate majority caucus voiced their hesitancy to pass their pension proposal with the Governor’s support before a budget solution is in place.

Senate Committee Bills of Interest

The Senate Assignment Committee released a great number of bills to Senate Standing Committees. The Senate standard operating procedure is to release all bills from Assignment to standing committees. This does not necessarily mean they will have a hearing and a subsequent vote, but it does not preclude the possibility either.  As such IRMA members should be aware of the following initiatives and bills that have been assigned to committees.

LABOR

Minimum Wage: SB 2145 (Sen. Kimberly A. Lightford, D-Chicago) has been assigned to the Executive Committee and increases the minimum wage from $8.25 to $9.00 beginning July 1, 2015 and increases it by $0.50 each July 1 until July 1, 2019, at which point the minimum wage will be $11.00. It provides that the establishment of a minimum wage that employers must pay their employees is an exclusive power and function of the State and is a denial and limitation of the home rule powers and functions, except that the limitation on home rule powers does not apply to a specified ordinance adopted by the City Council of City of Chicago. Additionally, it creates a credit against the withholding tax liability of employers with fewer than 50 employees, calculated based on the increase in the minimum wage.

Paid Sick Leave: SB 2147 (Sen. Toi W. Hutchinson, D-Chicago Heights) has been assigned to the Executive Committee and creates the Healthy Workplace Act. The legislation requires employers to provide up to 7 days of paid sick leave to employees. The employees may use the sick time to care for themselves, their family, their child upon school closings, and in response to being a victim of domestic assault.

ENVIRONMENT

Plastic Bag Recycling: SB 2224 (Sen. Terry Link, D-Gurnee) creates the Plastic Bag and Film Recycling Act and has been assigned to the Environment and Conversation Committee. It requires manufacturers of plastic carryout bags to register with the Illinois Environmental Protection Agency and pay to the Agency an initial registration fee and annual registration renewal fee. It prohibits a manufacturer from selling or offering to sell plastic carryout bag in the State unless the manufacturer is registered with the Agency and its name is printed on the plastic carryout bags it manufactures. Additionally, it requires each manufacturer to develop, and submit to the Agency, a plan to support the collection and recycling of plastic carryout bags and plastic film product wrap and prohibits retailers from purchasing plastic carryout bags from manufacturers under certain circumstances.

Recycled Materials: SB 2202 (Sen. Pamela J. Althoff, R-McHenry)has been assigned to the Environment and Conversation Committee and provides that material that is intended or collected to be recycled is not garbage, refuse, or ashes. This bill prohibits residents from putting plastic bags in the garbage with the idea that consumers would take the bags back to the retailer.

Oil Filter Landfill Ban: HB 4029 (Rep. Elaine Nekritz, D-Buffalo Grove) has been assigned to the House Environmental Committee and would ban all oil filters from the landfill with the expectation that consumers would take the oil filters back to the retailer.

REGULATION

Healthcare: SB 2177 (Sen. Michael Noland, D-Elgin) has been assigned to the Executive Committee and Creates the Illinois Universal Health Care Act. It provides that all individuals residing in the State are covered under the Illinois Health Services Program for health insurance. It sets forth the health coverage benefits that participants are entitled to under the Program and sets forth the qualification requirements for participating health providers.

Toy Guns: SB 2166 (Sen. Ira I. Silverstein, D-Chicago) has been assigned to the Judiciary Committee and provides that it is a Class B misdemeanor for a person to purchase, possess, conceal, use, sell, give away, or otherwise transfer, or to engage in the business of selling or to exhibit for sale, a replica firearm, paint pellet, or paint pellet gun in the State. It provides that each replica firearm shall have as an integral part, permanently affixed, a blaze orange plug inserted in the barrel of the replica firearm and provides that the plug shall be recessed no more than 6 millimeters from the muzzle end of the barrel of the firearm. Additionally, it mandates that each purchase, use, sale, gift, or transfer of any replica firearm, paint pellet, or paint pellet gun in violation of this provision shall be deemed a separate and distinct offense, and each day a person unlawfully engages in the business of selling or exhibits for sale any replica firearm, paint pellet, or paint pellet gun in violation of this provision is a separate and distinct offense.

Auto Insurance: SB 2208 (Sen. Jacqueline Y. Collins, D-Chicago) has been assigned to the Insurance Committee and provides that an insurer authorized to do business in the State shall not use a consumer’s credit information or credit report to calculate an insurance score for private passenger automobile insurance policies amended, delivered, issued, or renewed on or after the effective date of the amendatory Act.

Amusement Rides:  SB 2179 (Sen. Ira I. Silverstein, D-Chicago) has been assigned to the Public Health and provides that “amusement ride” includes any water slide, as defined by the Swimming Facility Act.

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