Retail Day 2012, part of the Business Day 2012 event, will be hosted by the Illinois Retail Merchants Association in conjunction with the Illinois Manufacturers Association at the President Abraham Lincoln Hotel and Conference Center in Springfield.

The program starts with a noon Luncheon at the President Abraham Lincoln Hotel followed by a visit with legislators at the Statehouse. The day concludes with an evening reception offering live music, food and drink and a chance to meet casually with legislators and fellow business leaders.

To register for Retail Day, contact IRMA at 1-800-572-5044 or email dbasowski@irma.org. Individual registrations are $85 per person. Meeting and hotel registration deadline is Tuesday, April 3. A limited number of rooms are available at a group rate of $102.99 per night at the President Abraham Lincoln Hotel and Conference Center. Ask for group code “IRMA” and call 866/788-1860 for room reservations.

Click here for the printable Registration Form

Amazon’s  Tax Problem: First Business interviews IRMA Senior Counsel Tanya Triche in a story explaining why tax-free online shopping may soon be a thing of the past. WATCH

In This Issue

Cook County Tax Changes
Caustic and Corrosive Substances Act
Cook County Sheriff Takes Action on Retail Theft
City Council Activity

COOK COUNTY TAX EFFECTIVE DATES

Several tax changes passed as part of the Cook County 2012 Budget that will go into effect at the beginning of the year. Please note the following changes:

Sales Tax Rollback and Home Rule Tax Changes

As part of its 2011 budget, the County Board set in motion a rollback of the Cook County sales tax through 2013. The sales tax, which started at 1.75% was rolled back 0.5% in January 2011 to its current rate of 1.25%. On January 1, 2012, the rate will be rolled back again to 1%. The final rollback will occur on January 1, 2013 to bring the tax down to 0.75%.

IRMA would like to thank Cook County Board President Toni Preckwinkle and all of the County Commissioners who voted for the rollback which gives people more reasons to shop and increase sales tax revenue in Cook County.

Alcohol Tax

The alcohol tax was increased in all categories and will have an effective date of January 2, 2012. Please see the link to the alcohol conversion chart provided by the Cook County Department of Revenue. The increases are as follows:

• –Alcoholic beverages (other than beer) containing 14% or less alcohol by volume: increase from $0.16 to $0.24/gallon

• –Alcoholic beverages containing more than 14% and less than 20% alcohol by volume: increase from $0.30 to $0.45/gallon

• –Alcoholic beverages containing 20% or more alcohol by volume: increase from $2.00 to $2.50/gallon

• –Beer: increase from $0.06 to $0.09/gallon

Effective Dates

All relevant effective dates are listed in the linked document provided by the Cook County Department of Revenue.

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CAUSTIC AND CORROSIVE SUBSTANCES

Public Act 97-0565 will require all retailers that sell products containing caustic/corrosive acids which are regulated by the Federal Caustic Poison Act AND have a statement on the label that the product “causes severe burns” must have their customers sign a registry with identifying information of both the purchaser and the product prior to the purchase of the product. Such qualifying items for the registry would include some cleaning products, drain cleaners, paint products, art products and automotive products. Batteries are exempt from the Act. We encourage you to check your inventory to see which products are carried in your stores so that they are properly flagged in your system for future registration. Although not required by the Act, we have prepared a sign which you may find helpful to place near such qualifying products. We have also prepared a sample registry for use in your stores.

The Act preempts local jurisdictions from legislating in the area of caustic/corrosive substances; therefore the Chicago law passed last January which requires purchasers to register for any item that contains a caustic or corrosive acid will no longer be in effect on January 1, 2012.

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COOK COUNTY SHERIFF TOM DART CRACKS DOWN ON OUTSTANDING RETAIL THEFT WARRANTS

With the holiday season in full swing, Cook County Sheriff Tom Dart turned his focus to criminals who steal from retailers and whose actions drive up the price of goods for all shoppers. The Sheriff’s Office’s Central Warrants Unit set up an operation titled, “Last Point of Purchase” from December 5-9, 2011. This operation targeted shoplifters with outstanding warrants in Cook County and was lauded as a major success. Working alongside local police departments, the Cook County State’s Attorney’s office and the US Marshal’s office, the Unit made 60 arrests over the four-day period of the sting.

The persons arrested were wanted for retail theft, credit card fraud, identity theft and other crimes related to retail.

Organized Retail Crime is a serious threat to the retail community in Chicago, and by partnering with the Cook County Sheriff’s Office, IRMA’s members are sending a message that they we will not be passive about retail theft and that criminals in Cook County will be caught and prosecuted for their crimes.

IRMA would like to thank Sheriff Dart and his team for their great work in this effort and for their commitment to catching professional shoplifters and other participants in organized retail crime.

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Contact Information:

312/726-4600

2011 has turned out to be a very successful calendar year. So successful it really began on Dec. 9, 2010.

On that date, Gov. Pat Quinn asked IRMA “what could be done about leveling the playing field that retailers face from their internet counterparts not collecting the Illinois sales tax.”  That conversation set in motion IRMA discussions with Senate President John Cullerton and Senate Republican Leader Christine Radogno on the subject.

When IRMA raised the New York law to create nexus for internet sellers their immediate reaction was “let’s go.”  In a subsequent meeting with House Republican Leader Tom Cross and Speaker Michael Madigan’s designee, House Revenue Chairman John Bradley, both said they would be supportive if the measure was reported out of the Senate.

When the Legislature returned to Springfield on Jan. 4 Senator Cullerton and his co-sponsor Senator Radogno filed an amendment to HB 3659. It was heard in committee and on Jan. 5 passed on a 49-6 roll call. The next day, the House concurred and the E-Fairness Act was passed on an 88-29 roll call.

Gov. Quinn signed the Bill into law on March 10.  The speed in which the House and Senate enacted this legislation was indicative of the support and urgency with which this country needs to deal with sales tax collections. None of this would have happened without a conversation with Gov. Quinn or the support of all those named above.

On Feb. 23, the Organized Retail Crime Bill sponsored by Senator Iris Martinez and Representative Connie Howard was signed into law by Gov. Quinn.  This far-reaching legislation, which expands our current forfeiture law to include organizers of retail crime, has become the model for the nation.

April brought about the appropriate time for IRMA members participating in the Exelon Energy Program to renew and extend purchase contracts for electricity because of favorable market conditions. For the first time in recent memory, members were able to secure long-term contracts on electricity, in many instances at or just below 4 cents per KWH. Because of low demand for electricity and natural gas, the timing was good to secure historic low prices for energy.

Worker’s Compensation negotiations and passage through both the House and Senate happened in May. House Bill 1698 sponsored by Representative John Bradley and Senator Kwame Raoul passed both Houses in the final days of May. It took a lot of work, but good things usually do.

The measure called for a 30 percent reduction in the medical fee schedule and other significant reforms. The leadership of Gov. Quinn, President Cullerton, Republican Leader Radogno and Speaker Madigan along with the Sponsors created an environment where the first major reform in worker’s compensation in more than 30 years was accomplished.

It did not happen without controversy. There were those in the Assembly and within the business community who thought the changes were not substantial enough to justify adoption.  Obviously good judgment prevailed over good politics. There is still a lot more to be done, but this is a good start.

In June Gov. Quinn invited IRMA and the Illinois Manufacturers’ Association to join him in a fly-around to sign the Worker’s Compensation Reform Bill.

Also in June, through the fine leadership of retailing’s national trade associations and the “grass roots” support of State Retail Associations, the industry defeated an Amendment which would have modified and delayed the Swipe Fee Amendment which was passed by our own Illinois Senator, Dick Durbin. Not a bad month for the industry.

Illinois Gov. Pat Quinn announces a new Organized Retail Crime law on Feb. 23 in Chicago. The new law was designed to separate it from other felony retail theft and serve as a deterrent to sophisticated crime rings.

In July DHS filed a Rule to reduce pharmacy reimbursement by $42 million. IRMA objected formally and through great “grassroots” contacts delayed the Rule at the Joint Committee on Administration Rules. In July and August the pressure was kept on the Department and they agreed to a Sept. 12 formal hearing.

At the hearing, IRMA and the other pharmacy groups presented compelling reasons why pharmacy should not be cut. Subsequent to the meeting, discussion and negotiations were held with the Department causing an Amended Rule to be filed on Dec. 15, which will not harm pharmacy while achieving long term goals for the Department.

July trips to Washington with IRMA members and staff allowed for serious discussions on the “Main Street Fairness Act” to authorize the collection of sales taxes throughout the country. For the first time since the “Quill” Supreme Court case in 1992, Bills were introduced, hearings were scheduled and enormous visibility was brought to “level the playing field” for retailers across America.

At IRMA it is believed that much of the publicity, movement and new consideration in many states of “Bills to require the collections of sales taxes” was precipitated by the activities in the first week in January in the Legislature in Illinois.

Special thanks go to Senator Cullerton for his many years of support for E-Fairness and the number of contacts he made with Senator Durbin requesting federal action and to Senator Durbin for introducing the Main Street Fairness Act on the federal level this year. Additional meetings with local chambers of commerce and editorial boards, members of Congress and the United States Senate continued in September in support of Main Street Fairness.

Illinois Gov. Pat Quinn shows the newly signed Unemployment Insurance agreement on Nov. 29. He is surrounded by representatives of the business community, including (second from left) IRMA Senior Vice-President Rob Karr and (next to the Gov.) IRMA President & CEO David F. Vite.

Potash Markets, Chicago, was honored in September at the very successful IRMA Annual Luncheon as Illinois Retailer of The Year. The Potash family was appropriately recognized for their contributions to the community, their industry and their employees. The annual event was made even more special as Senator Durbin saluted Potash Markets in a special video presentation, and Chicago Mayor Rahm Emanuel gave his first speech to the Illinois retailers.

Outgoing IRMA Board Chairman Richard Cohen of Macy's, left, and incoming Board Chairman C.J. Schnakenberg of Chicago Brass, right, meet Chicago Mayor Rahm Emanuel at IRMA's 54th Annual Luncheon in September.

October was a time of intense negotiations on what turned out to be the successful November adoption of the Unemployment Insurance Reform Act of 2011, SB 72.  Participating in the “agreed bill process” called by Gov. Quinn and supported by the legislative leaders, business and labor worked diligently to fashion a solution that was reasoned for unemployment workers and cost saving for Illinois business.

While the IRMA-led negotiations were difficult, often acrimonious, they produced a product which will save Illinois employers over $400 million over the next eight years. The UI Reform Act passed the General Assembly and was signed into law on Nov. 18 by the Governor.

In addition, during October and November, IRMA provided much-needed business community support to Toni Preckwinkle, President of the Cook County Board of Commissioners, for the continued rollback of the sales tax. IRMA testified in support of the measure and was featured in Chicago’s leading business publication as well as the Sun-Times for its support of the rollback. Residents of Cook County will see the sales tax rolled back by .25 percent at the start of 2012.

November also brought discussions about tax reform not only in Cook County but in the state legislature as well. The discussions led to a December passage of a Bill to increase the Estate Tax Exemption to $4 million over the next two years, provide for a Net Operating Loss deduction of up to $100,000 and retain two of Illinois most venerable companies and their attendant jobs in Illinois. We are proud to call Illinois the home of Sears Holdings Corporation.

You will note that everything discussed has been positive. The only real downside to this legislative year was the passage of a temporary Income Tax increase. There is much work to be done in Illinois to regain prominence once again in job creation, business climate and image.  Steps taken in 2011 have been good, but be assured that IRMA will continue to work with the elected leaders of this state to create an environment in which retailers and other businesses can create jobs, increase economic opportunity and improve the reputation of “the Land of Lincoln.”

IRMA is grateful to IRMA’s Chairman C. J. Schnakenberg, its most recent Chairman Richard Cohen, and all members of the Board for guiding the staff through the policies and decisions necessary to have a successful 2011. No doubt under the continued leadership of Chairman Schnakenberg, IRMA will continue to be successful.

This is a great time of year to reflect on all of the successes and positive things which have occurred in the previous year. That time of retrospective review will create new beginnings for 2012.

HAPPY NEW YEAR!!

Retailers lead the charitable way

Retail companies took the first three spots on a list of the five most generous corporations in the United States, according to The Chronicle of Philanthropy, a magazine that monitors the charitable giving industry.

The magazine’s 2011 Survey of Corporate Giving looked at data on 2010 donations for 180 of the Fortune 500 companies. The top five – which included Kroger Corporation, Macy’s and Safeway, parent of Dominick’s Food Stores, each gave more than 5 percent of their  2009 profits to charity during 2010.

Topping the list was Kroger, the Cincinnati supermarket chain, which gave 10.9 percent of its previous year’s profit to charity last year. The company, which gave $64 million to charity, is active in the Food 4 Less program to feed the hungry, has raised $1.5 million for military familes and welcomed Salvation Army donation kettles into its stores.

Macy’s was second on the list, giving 8.1 percent of its 2009 profits during 2010, a total of more than $41 million. The company funded more than 1,200 grants to organizations in the communities where it operates.

Third on the list was Safeway, which donated 7.5 percent of its profits for a total of $76.5 million. Safeway gave to causes such as Easter Seals, Special Olympics, Muscular Dystrophy Association and prostate and breast cancer initiatives, according to the report.

The largest overall corporate donor in 2010 was Wal-Mart, which claimed that distinction for the third straight year. The company donated more than $319 million local and national initiatives to combat hunger and promote local economic development in its communities, the report stated.

Marine Sgt. Peter Sifnotis accepts a check from IRMA President & CEO David F. Vite after several IRMA member retailers donated a total of $36,000 to Toys for Tots.

While police investigated the alleged embezzlement of $25,000 from Toys for Tots Chicagoland, IRMA staff talked to numerous retail members who offered to help replace the missing funds. On Tuesday afternoon, the retailers’ donations totaled $36,000.

The Santa’s of the contribution included CVS, Dominick’s, Macy’s, McDonald’s, Sears, Target, Walgreens and Walmart.

IRMA served as a collection source for the donations and the money was presented to a representative of the Marine Corps Reserves at IRMA’s Chicago office on Dec. 21.

“The generosity from these companies was remarkable, but not surprising,” said IRMA President & CEO David F. Vite. “They stepped up when there was a need, just as they have done many times before.”

The $25,000 represents about a year’s worth of cash donations to the organization. News reports showed that a number of individuals also responded with donations when they found out about the missing Toys for Tots’ funds.

In This Issue

Cook County 2012 Budget

City Council Activity

COOK COUNTY 2012 BUDGET

CITY COUNCIL MEETING - NOVEMBER UPDATE

INTRODUCTIONS – ORDINANCES AND RESOLUTIONS

Ordinance to Ban Plastic Bags – Ald. Proco Joe Moreno and others- Committee on Health and Environmental Protection (Nov. 2)

December 13, 2011

This Week In Springfield, the Illinois General Assembly briefly returned to address the lingering income tax relief package not finalized before Thanksgiving.

INCOME TAX RELIEF

TWIS readers will recall that during the second week of the Fall Veto Session, the Senate passed an income tax relief proposal. That proposal failed in the House for numerous reasons expressed by both Democrats and Republicans. At that time, the leaders announced their intent to negotiate a compromise and return for final action. This week, the Assembly returned to consider the proposal negotiated by the legislative leaders and their surrogates. The initial proposal that failed during the regularly scheduled Veto Session was one bill. The proposal considered this week, was broken into two proposals.

The first component was S.B. 397 (Sen. Toi Hutchinson, D- Chicago Heights/Rep. John Bradley, D- Marion). S.B. 397 contained corporate income tax relief provisions including: (1) an increase in the exemption on the inheritance tax deduction from $2 million to $3.5 million for anyone dying on or after January 1, 2012 and before January 1, 2013 and to $4 million for anyone dying on or after January 1, 2013; (2) reinstatement of the Net Operating Loss (NOL) beginning January 1, 2012 with a cap of $100,000; and (3) a five year extension on the expiration or sunset of every exemption, credit and deduction set to expire in 2011, 2012, or 2013.

In addition to the noteworthy items listed above, S.B. 397 also contained an EDGE tax credit for Sears Holding Corporation and Champion Laboratories and a change in the income apportionment rate for the Chicago Mercantile Exchange (CME). In all cases, these proposals were necessary to keep these entities in Illinois in the face of aggressive and, in most cases, more generous offers from other states.

S.B. 397 as amended by House Amendments 3 and 7 passed the House 81-28-7 and the Senate 44-9.

The second component of the tax relief package was contained in S.B. 400 (Sen. Toi Hutchinson, D- Chicago Heights/Rep. Barbara Flynn Currie, D- Chicago). S.B. 400 contained an increase in the personal exemption from $2,000 to $2,050 in 2013. From 2014 on, the personal exemption is increased by a cost-of-living adjustment. This adjustment is determined by the rate of inflation as determined annually in the Consumer Price Index (CPI). S.B. 400 also contained an increase in the Earned Income Tax Credit (EITC) from the current 5 percent to 7.5 percent in 2012 and to 10 percent for tax years beginning on or after January 1, 2013.

As with its counterpart, S.B. 400 as amended by House Amendments 1 and 2 passed the House 67-49 and the Senate 48-4.

On behalf of the entire Illinois retail community, IRMA would like to thank all those involved in the successful passage of this proposal. House Revenue & Finance Committee Chairman John Bradley (D- Marion), House Majority Leader Barbara Flynn Currie (D- Chicago), House Republican Leader Tom Cross (R- Oswego), Republican Spokesman on the House Revenue & Finance Committee David Harris (R-Arlington Heights), Senate Revenue Committee Chairman Toi Hutchinson (D- Chicago Heights), Senate Republican Leader Christine Radogno (R- Lemont), and Senate President John Cullerton (D- Chicago)for their diligence and effort throughout the process. Additionally, IRMA would like to thank Governor Pat Quinn for his leadership and every member of the Assembly who supported the proposal. Speaker of the House Michael Madigan (D- Chicago) declared a conflict early in the process, removed him from this process, and directed Rep. Bradley to conduct negotiations.

SCHEDULE

The Assembly has now adjourned for the holidays. It is scheduled to return January 31, 2012 when the Second Spring Session of the 97^th Illinois General Assembly will begin in earnest.

Rob Karr
Vice President
Government & Member Relations
rkarr@irma.org

Chicago – What’s at stake for Illinois if Sears Holdings Corp. decides to pull up stakes and move out? David Vite, of the Illinois Retail Merchants Association joined FOX Chicago Sunday to talk about what it would mean to lose the parent company of Sears. WATCH

Some retailers in Illinois are lobbying for E-fairness nationally; a move to require online vendors to charge sales tax just like brick-and-mortar businesses. GO TO STORY

SPRINGFIELD — Illinoisans who buy the latest best-selling book as a Christmas gift on Amazon.com will pay $12.99. Buy the same book at a local bookstore and they’ll pay an extra 81 cents. The bookstore isn’t charging more. It’s collecting Illinois’ 6.25 percent sales tax, which online retailers without a physical presence in the state don’t have to collect. GO TO STORY