Illinois This Week in Springfield – 99-03

IN THIS ISSUE:

BUDGET ADDRESS
BUDGET ADDRESS REACTION
BILL INTRODUCTIONS

This Week In Springfield, legislative committees began their work while the week was dominated by Governor Bruce Rauner’s first budget address.

BUDGET ADDRESS

 

Wednesday, Governor Bruce Rauner delivered his first budget address. The much-anticipated proposal attempts to close the deficit in the current budget, balance the Fiscal Year 2016 budget while attempting to restore Illinois’ fiscal health in the long-term. He laid the blame for the current condition on “years of bad decisions, sleight-of-hand budgeting and giveaways we couldn’t afford.”

Stating that Illinois has “been living beyond our means-spending money that Illinois taxpayers could not afford”, Governor Rauner’s proposed budget cuts over $1.6 billion in spending to close the deficit in the current budget. He then proposed an additional $6.1 billion in spending reductions to bring Illinois’ spending in line with anticipated revenues while leaving room to pay off an additional $500 million in unpaid bills.

The Governor’s proposal did not include tax increases. He stated that “asking for more of the taxpayers’ hard-earned money without fundamentally reforming the structure of state government would further erode public confidence and accelerate our decline.”

Illinois’ largest-in-the-nation pension obligation backlog of over $110 billion is the Governor’s first target.  While he plans to protect benefits that have been earned to date, Governor Rauner desires to ensure that future workers are pushed to a 401K-type of retirement plan.  He made note that because of the dangerous nature of police and fire who put their lives on the line every day for our safety, he would exempt those groups from the proposed changes.  He also would allow employees hired before 2011 a buyout option which would include a payment and defined contribution plan in exchange for a reduction in COLA. The Governor estimates these reforms would save over $2 billion. However, it is a virtual certainty that even if such reforms were to pass the Assembly, they would be immediately challenged in court by unions representing state employees.

Governor Rauner then turned his attention to local governments.  Claiming that some had cash reserves and that payment to local governments in general had been increasing over the years, Gov. Rauner noted that they would experience a reduction equal to 3% of their revenue.  Local governments could then consolidate and restructure compensation packages and employment in order to adjust to the cut.  Cuts are also on the horizon for transportation agencies and Medicaid although the details here will be forthcoming in a separate package set to be introduced on Monday.  For now, we know that he proposes to save $75 million by conducting an aggressive eligibility review campaign and re-instituting SMART Act reforms that could save an additional $320 million.

The entire speech was not about spending reductions, however. Governor Rauner is proposing additional funds for early education and K-12 education in the neighborhood of $300 million. While universities were included in the budget cuts, community colleges and vocational schools were not.

Of immediate concern to Illinois’ pharmacy community, the Governor’s budget proposes $1.5 billion in cuts to the Medicaid program. Of this cut, approximately $42 million will fall on Illinois pharmacies through a reduction in the dispensing fee. This is particularly hurtful to Illinois pharmacies who experienced a 9% cut during the last round of Medicaid reform in 2011 while other providers only realized a 3% reduction. IRMA released the following statement in response to the budget address in general and the proposed pharmacy reimbursement cuts in particular:

“Governor Rauner inherited an enormous budget crisis and pension obligation that presents many fiscal challenges to our state. IRMA applauds his desire to balance the budget and help turn the state’s economy around. Our members – which include retail and mom and pop pharmacy providers- are more than a little concerned with the cuts to Medicaid. We hope to work closely with Administration and the legislature on issues impacting Medicaid in general and pharmacies in particular. Pharmacists, one of the nation’s most trusted professions, have seen two rounds of cuts and three times more than any other provider is asking more than a fair share of pharmacy providers,” said Rob Karr, President/CEO, Illinois Retail Merchants Association.

In an effort to push economic growth, the Governor has plans to achieve additional reforms to workers compensation, tort reform, pensions and taxes.  In an additional nod to the high costs of doing business Illinois, he wishes to freeze property taxes as well.

By making the government run more efficiently, cut where he is able and invest where it is necessary, Governor Rauner stated that he hopes his budget will ignite the spirit of President Abraham Lincoln who called for everyone to “think anew and act anew” and  will put Illinois on the path “…to a more prosperous future.”

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BUDGET ADDRESS REACTION

 

Reaction to the Governor’s first budget address fell along party lines. Senate President John Cullerton (D- Chicago) immediately noted that predicating the budget on the proposed pension reform was not realistic and declared that immediately put a $2 billion-plus hole in the Governor’s proposed budget.

The normally reserved and understated Speaker of the Illinois House Michael J. Madigan (D- Chicago) also stated his disagreement with the pension reform proposal and stated that he disagrees with the belief that Illinois can simply cut services and resolve the problem. “I think that the elimination of the deficits will require a blend of service cuts plus new revenue,” stated Madigan.

Senate Republican Leader Christine Radogno and House Republican Leader Jim Durkinboth cautioned that the budget address is just the start of a long processs. Leader Radogno noted that “we absolutely have to change the way we do things” while Leader Durking noted that ‘everything in that speech is subject to negotiation”.

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BILL INTRODUCTIONS

 

CONSUMER FRAUD

SB 1259 (Sen. James F. Clayborne, Jr., D-East St. Louis) and HB 2450 (Rep. Dan Burke, D-Chicago) provides that it is an unlawful practice for a manufacturer or distributor of prescription contact lenses to prevent a retailer from selling or advertising contact lenses below any specified price.

CREDIT AND FINANCE

HB 2541 (Rep. Monique Davis, D-Chicago) provides that a credit card issuer may not automatically renew a credit card that has not been used to perform a credit card transaction within the 12 months immediately preceding the renewal.

ENVIRONMENT AND UTILITIES

SB 1261 (Sen. Linda Holmes, D-Aurora) mandates that manufacturers add an extra fee on all architectural paint sold in Illinois and pass it down the line. Retailers are required to pass the tax on to consumers. Retailers are also encouraged to become voluntary collection sites. This tax is mandated, assessed, and retained by PaintCare, which is a non-governmental entity comprised of paint manufacturers for the collection, transportation, and recycling of paint. PaintCare may increase the tax and products that are taxed may be expanded at any time.

SB 1300 (Sen. Toi Hutchinson, D-Chicago) creates the Smart Phone Kill Switch Act. It requires that any smart phone manufactured on or after July 1, 2016 that is sold or purchased in Illinois must be equipped with preloaded anti-theft functionality or be capable of downloading that functionality and requires the functionality to be available to purchasers at no cost. Additionally, it requires wireless communications device dealers to maintain a written record of every purchase or acquisition of a used wireless communications device for resale. And further requires the installation of video security cameras at a dealer’s physical location. Finally it provides exemptions from the application of the Act, including wireless telephone providers who acquire devices for trade-in or for repair and refurbishment programs.

HB 2607 (Rep. Elaine Nekritz, D-Buffalo Grove) requires the Planning and Procurement Bureau to establish a long-term renewable resources procurement plan that includes all renewable energy credits necessary to meet specified goals (replacing the current renewable portfolio standards). It sets forth guidelines for what shall be included in the procurement plan. It makes changes concerning nondiscrimination, energy efficiency and demand-response measures, natural gas efficiency programs, real-time pricing, infrastructure investment and modernization, the Illinois Smart Grid test bed, and on-bill financing programs for electric and gas utilities and Adds provisions related to renewable energy credit procurement. Amends the Environmental Protection Act. Finally, it provides that upon promulgation by the U.S. Environmental Protection Agency of a final rule regulating carbon dioxide emissions from existing electric generating units, the Illinois Environmental Protection Agency shall be authorized to implement a cap and invest program or similar market mechanism to regulate carbon dioxide emissions.

 LABOR

SB 1363 (Sen. Ira Silverstein, D-Chicago) creates the Workplace Bullying Prohibition Act and provides that bullying is prohibited in the workplace. The legislation applies to employers that employ 3 or more individuals but excludes the State, State agencies, and units of local government. It requires an employer to establish a policy regarding workplace bullying and file the policy electronically with the Department of Labor. Additionally, it provides that a violation of the Act by an employer constitutes a business offense subject to a fine of not less than $1,000 and not more than $2,000.

HB 2549 (Rep. Esther Golar, D-Chicago) creates the Best Candidate for the Job Act that provides that private employers shall properly consider for employment persons previously convicted of one or more criminal offenses. It prohibits discrimination against such persons unless there is a direct relationship between the offense and the specific employment sought. It also establishes criteria for evaluating convictions. Provides that an employer that demonstrates that it has hired an individual pursuant to the Act, except for a willful or wanton act in hiring an individual, shall not be liable for acts or omissions by the employee. Exempts law enforcement agencies.

LOSS PREVENTION

HB 2496 (Rep. Will Guzzardi, D-Chicago) changes the additional amount of damages that may be recovered by the merchant from an amount not less than $100 nor more than $1,000 to an amount equal to the lesser of $500 or 3 times the full retail value of the merchandise.  It also provides that a merchant may recover civil damages for retail theft by bringing suit in a circuit court or by executing a settlement agreement. It specifies form of settlement agreement. It requires the settlement agreement to include a statement that nothing in the agreement shall constitute an admission of guilt for purposes of criminal law and that if the agreement is signed and payment is made in full within 60 days, no police report or criminal complaint will be filed by the merchant relative to the incident. Nothing in the agreement can or will bar the State from instituting the criminal prosecutions as it deems necessary.

PHARMACY

SB 1359 (Sen. Linda Holmes, D-Aurora) provides that a health plan that provides coverage for prescription drugs shall ensure that any required copayment or coinsurance applicable to drugs on a specialty tier does not exceed $100 per month for up to a 30-day supply of any single drug and a beneficiary’s annual out-of-pocket expenditures for prescription drugs are limited to no more than fifty percent of the dollar amounts in effect under specified provisions of the federal Patient Protection Affordable Care Act. It also provides that a health plan that provides coverage for prescription drugs and uses a tiered formulary shall implement an exceptions process that allows enrollees to request an exception to the tiered cost-sharing structure. Finally, it provides that a health plan that provides coverage for prescription drugs shall not place all drugs in a given class on a specialty tier.

HB 2507 (Rep. Robert Martwick, D-Chicago) provides that smoking cessation products shall not be subject to prior approval as a result of the 4-prescription limit.

HB 2525 (Rep. Mike Tryon, R-Crystal Lake) provides that over-the-counter medications that are prescribed to a recipient of medical assistance by a physician, a physician’s assistant, a nurse practitioner, or any other medical care provider qualified to prescribe medications shall be covered under the State’s medical assistance program.  It also provides that pharmacies providing prescribed over-the-counter medications shall be reimbursed at the same rate determined by the Department of Healthcare and Family Services for prescription medications covered under the State’s medical assistance program. Additionally, it requires the Department to establish guidelines and standards by administrative rule on the documentation, if any, a medical care provider must submit when prescribing an over-the-counter medication to a recipient of medical assistance. Effective immediately.

REGULATION AND LICENSING

HB 2513 (Rep. Marcus Evans, D-Chicago) provides that a person who is both a licensed distributor and a licensed retailer shall be issued a single license number by the Department of Revenue. It also provides that records may be kept electronically and may be kept at an out-of-state location so long as those records are made available upon reasonable notice for the purpose of investigation and control by the Department of Revenue. Amends the Prevention of Tobacco Use by Minors and Sale and Distribution of Tobacco Products Act. In provisions that provide for increased penalties for retailers that do not have training programs, provides that those training programs may be conducted electronically. If a retailer has a training program in place prior to the effective date of the amendatory Act, has a training program approved by another state, or follows the guidelines set forth by the federal Food and Drug Administration, then that training program shall be deemed to meet the minimum standards in this State.

HB 2589 (Rep. Silvana Tabares, D-Chicago)provides that a person over the age of 18 found guilty of certain animal abuse offenses shall register with the national Do Not Adopt Registry within 10 days after the conviction and shall register annually for 10 years after the conviction. Further it provides that failure to properly register as required under the Act shall be a business offense with a fine of $100 for the first offense, $500 for the second offense, and $1,000 for the third or subsequent offense. Additionally, it provides that any animal shelter, pet store, animal breeder, or person shall conduct a search of the national Do Not Adopt Registry prior to selling, transferring, delivering, or placing for adoption a companion animal to another person.

HB 2667 (Rep. Robyn Gabel, D-Evanston) creates the Healthy Eating Active Living (HEAL) Act and imposes a tax on distributors of bottled sugar-sweetened beverages, syrups, or powders at the rate of $0.01 per ounce of bottled sugar-sweetened beverages sold or offered for sale to a retailer for sale in the State to a consumer. It requires those distributors to obtain permits. Additionally, it provides that 2% of the moneys shall be deposited into the Tax Compliance and Administration Fund for the administrative costs of the Department of Revenue, and 98% of the moneys shall be deposited into the Illinois Wellness Fund to be used for wellness programs and for expanded obesity prevention and treatment services for Medicaid beneficiaries. Finally, it creates an Advisory Council to govern the distribution of Illinois Wellness Fund moneys.

INSURANCE

SB 1333 (Sen. Linda Holmes, D-Aurora) provides that neither a group health plan nor an accident and health insurer offering group or individual health insurance coverage shall discriminate with respect to participation under the plan or coverage against any health care provider who is acting within the scope of that provider’s license or certification under applicable State law.

HB 2711 (Rep. Dan Brady, R-Normal) provides that insurers may not set reimbursement rates in a manner that discriminates against a class of eye care providers. It also provides that eye care coverage insurers may not preclude obtaining eye care directly from a licensed provider on a health care panel or promote a class of providers to the detriment of another class of providers. It requires that all providers on a provider panel be included in any publicly accessible list and requires the inclusion of ophthalmologists and optometrists in provider panels.

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IRMA 3 TWIS web

Illinois This Week in Springfield 99-02

In This Issue:

STATE OF THE STATE STATE
MINIMUM WAGE
INFRASTRUCTURE TAX
BAD DEBT

 

The General Assembly convened this week and much of the attention centered on Governor Rauner’s State of the State address.  After he delivered his speech, which included an outline to increase the minimum wage, the Senate passed their own minimum wage increase.

STATE OF THE STATE

This week, Gov. Rauner delivered his first State of the State address to the General Assembly.  The much anticipated speech laid out the issues that Gov. Rauner wants to tackle during his term.  He will focus on growing the economy and attracting jobs, ensuring that children in all income levels receive a quality education, reform the way taxes are used and structured, and change the way government operates and interacts with citizens.  But he cautioned listeners that returning Illinois to its rightful place as one of the best places to live and work in the country is a long-term goal.  Gov. Rauner stated that his focus will not be on the next election, but on doing what’s best for the state.  Citing competitiveness as his watchword and opportunity and compassion as his goals, Gov. Rauner laid out a tough and ambitious agenda.

Of particular interest to the retail community, he laid out a specific plan for the minimum wage by supporting an increase of 25 cents per year for the next 7 years.  He tied his support for a minimum wage increase to reforms in the workers’ compensation and unemployment insurance systems.

As he did during the campaign, the Governor will make Worker’s Compensation reform a priority.  He claimed Attorney General Lisa Madigan as an ally based on her past expressions of support for addressing how causation is interpreted.  Additionally, he also expressed a desire to make the unemployment insurance system work better for both employers and employees.  It remains to be seen how potential reforms to the unemployment system will be addressed. The system is currently under an ‘agreed bill’ process which was negotiated by representatives of employers and labor. The current agreement has returned Illinois Unemployment Insurance Trust Fund to solvency ahead of schedule. However, it also contains ‘speed bumps’ (aka benefit cuts for laid off workers and tax increases for employers). These ‘speed bumps’ are designed to force both parties back to the negotiating table to review the agreement and ensure it is having its desired effect. These speed bumps must be addressed this year or the aforementioned benefit cuts and tax increases will take effect.

Governor Rauner put a good deal of emphasis on education reform – a topic that is near and dear to his heart and a subject area in which he has long been involved. In order to have a highly trained and educated workforce, his administration will focus on ensuring that each child in Illinois has access to a quality education form an early age.  Since not every child will want or have the means to attend a four-year university, Gov. Rauner stressed that community colleges should be better equipped with technical and vocational training so that everyone has a real shot at the middle-class.  Gov. Rauner mentioned that he wanted to eliminate unnecessary testing so that teachers have more time to teach, and he wants to create incentives to attract the best and brightest teachers to Illinois.

As part of the reforms he wants to achieve, the Governor suggested giving local citizens greater power over the collective bargaining processes of their local governments and school districts including the right to create by referendum local empowerment zones. As described by the Governor, employees in these zones would have the right to decide whether or not to join a union. Additionally, the Governor stated that Lt. Gov. Evelyn Sanguinetti would be directly involved in finding ways to consolidate government and rid itself of unfunded mandates.

During his speech, the Governor made passing reference to the need to reform ‘our out-of-date tax code’ pointing out that the ‘base it too narrow, and that makes us uncompetitive.’ While the speech itself contained no other details, his staff distributed additional details after the speech. As it relates to taxes, those details included:

    • Modernizing the sales tax to include service taxes;
    • Increasing the Earned Income Tax Credit;
    • Make income taxes low and competitive with other states;
    • Restructure the motor fuel tax to appropriately invest in infrastructure.

 

Those interested in viewing the additional details can find them here. You can read the speech here and watch the video of the speech here.

Governor Rauner has laid out an ambitious plan for the state. As always, IRMA will engage with all parties in the days to come on those issues of interest to retail. Everyone now awaits the Governor’s budget address on February 18th.

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MINIMUM WAGE

The first bill heard in the Senate Executive Committee of the 99th General Assembly was a proposal by Sen. Kimberly Lightford (D-Westchester) to increase the minimum wage.  Sen. Lightford, who has been the champion for this issue, introduced a bill that addresses minimum wage in light of recent changes in Chicago and concerns about how a mandated increase would affect small businesses.  SB 11 proposes to raise the current minimum wage from $8.25 to $11.00 over a four-year period – a 25% increase in employers largest or second largest expense item.  In addition, it would preempt home rule units from imposing their own minimum wage with the exception of the recently enacted ordinance in the City of Chicago. In the case of Chicago, they would be allowed to increase their minimum wage to the $13 per hour called for in their ordinance but would be preempted from raising it beyond $13.  Lastly, in recognition of the fact an increase would have negative financial implications on employers, this proposal would establish a limited tax credit for businesses with 50 employees or less.  This is a significant development as it is an admission that minimum wage increases negatively impact employers and discourage employment – something the proponents have long denied.

IRMA President & CEO Rob Karr testified in opposition noting that no employer can afford a 25% increase in costs as no employer, certainly in the retail space, is experiencing sales and profit increases of 25%. Moreover, these increases are just on labor and do not include or take into account the ever-increasing costs of inputs, property taxes, etc. IRMA noted that the day before a noted and popular bookstore in San Francisco, CA, whose owner was among the leading advocates when San Francisco enacted their minimum wage which currently stands at $11.05, is closing this year citing the unsustainable minimum wage.

SB 11 does nothing to change the economic perception of Illinois. It does nothing to create jobs and grow the economy – something every economist agrees is the only prescription for significantly lowering unemployment and raising wages. Further, it continues to economically disenfranchise young workers who are experiencing unemployment over 50% in Illinois and over 90% in large portions of the City of Chicago.

After a short debate, the measure passed out of committee on a party-line vote of 11-5-0 and was sent to the Senate floor for additional consideration.  Wednesday, Senate Bill 11 passed the full Senate by a vote of 36-18-0.


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POTENTIAL INFRASTRUCTURE TAX?

The Transportation for Illinois Coalition (TFIC), a coalition co-chaired by the Illinois Chamber of Commerce and the Illinois AFL-CIO, has been trying for several years to garner support for additional taxes to fund a new capital infrastructure campaign. The State’s largest infrastructure program in history of $30 billion expired two years ago and was plugged last year by a $1.1 billion program.

The coalition is trying to raise at least $1.8 billion in annual revenues – $1.5 billion would be used for a Pay-As-You-Go (PAYGo) program and another $300 million to finance $3 billion in bonds.

Presently, the TFIC is laying out four funding scenarios. TWIS readers can view those scenarios here. The current centerpieces of their tax proposals are:

  1. Increase the Motor Fuel Tax by 13-cents. This would give Illinois the fourth highest state imposed motor fuel tax in the nation. (estimated to raise $780 million)
  2. Increase the state sales tax by .1%. (estimated to raise $154-$198 million)
  3. Double the sales tax on food from the current 1% to 2%. (estimated to raise $329 million)

Other proposed revenue sources to be paired with one or more of the above include increases in vehicle registrations, certificates of titles, driver’s licenses, and various fund transfers.

It is important to note that Governor Rauner’s administration, via Capitol Fax, a highly-read political blog focused on Illinois government and politics, is denying any connection stating: “The administration has not launched behind-the-scenes talks with legislators to raise the gas tax, or any other taxes or fees to fund a capital program. What’s being circulated by some advocacy groups is not the governor’s plan and does not have his blessing.”

IRMA will continue to monitor the discussion.

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BAD DEBT

Last year, an IRMA initiative to return fairness to the refunding of sales tax on bad debt passed both chamber of the Assembly unanimously. Former Governor Pat Quinn decided to use the bill as a vehicle for meaningless political posturing in literally his final moments in office effectively killing the bill. The initiative has been reintroduced in the form of HB 498 (Rep. Anthony DeLuca, D- Chicago Heights) and has already attracted 13 co-sponsors. The proposal has no known opponents. As a refresher, if a consumer does not pay for the merchandise they purchase on credit, and efforts to collect fail, a bad debt is declared and sales tax is refunded to the retailer. This happens because in the eyes of the law, a sale is deemed not to have occurred.

Several years ago, the Illinois Department of Revenue (IDOR) issued a controversial opinion that this did not apply to private label credit cards (PLCC’S). PLCC’s are cards emblazoned with the logo of a store and can only be used at that store unlike multipurpose cards (e.g. cards that may carry a logo but can be used anywhere) or general use cards (e.g. VISA, MasterCard, etc.). Over the course of last year, IRMA worked with IDOR to address their procedural concerns to ensure proper documentation would be available and lines of accountability would be clear.

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IRMA 3 TWIS web

State of the State Address- Illinois

FOR IMMEDIATE RELEASE
CONTACT:

Ryan McLaughlin, 312-588-4102
ryan@macstrategiesgroup.com

Statement from the Illinois Retail Merchants Association in Response to Governor Rauner’s State of the State Address

Illinois Governor Bruce Rauner
Illinois Governor Bruce Rauner

SPRINGFIELD – Illinois Retail Merchants Association (IRMA) has issued the following statement regarding Governor Rauner’s State of the State address:

“Governor Rauner has laid out an ambitious agenda reflective of a desire to see Illinois return to the role of an economic leader. We are concerned about proposals to increase the minimum wage as those mandates fall disproportionately on the retail industry, but attempts to offset those costs are welcomed as they recognize such mandates impose significant costs. Retailers will withhold judgment until we see the details, how those benefits accrue to Illinois retailers, and what other proposals may come from the upcoming budget address. We stand ready to work with Governor Rauner and the legislature to help grow the economy and jobs accordingly,” said Rob Karr, President/CEO, Illinois Retail Merchants Association.

 

Economic facts about the retail industry in Illinois:

  • 144,715 retail establishments
  • 1.6 million retail jobs
  • $65 billion in total labor income
  • $50 billion in direct impact on GDP

About The Illinois Retail Merchants Association (IRMA)

One of the largest state retail organizations in the United States, IRMA serves as the voice of retailing and the business community in state government. Founded in 1957,IRMA represents more than 23,000 stores of all sizes and merchandise lines. From the nation’s largest retailers to independent businesses in every corner of the State, merchants count on IRMA to fight for the best possible environment in which to do business in Illinois.

                                                                                         

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Retailers Disappointed as Lawmakers Pass Job-Killing Minimum Wage Hike

                                                                                                                      CONTACT:
Catie Sheehan, 217-220-1717
catie@macstrategiesgroup.com

Rob Karr testifying before Senate Executive Committee against the minimum wage.
Rob Karr, President & CEO, testifying before the Senate Executive Committee against the minimum wage.

Retailers Disappointed as Lawmakers Pass Job-Killing Minimum Wage Hike

Senate passes bill that will raise Illinois’ minimum wage to $11

SPRINGFIELD—February 5, 2015— Despite Illinois having a significantly higher minimum wage than all of its neighboring states, SB 11, introduced by Senator Kimberly Lightford (D-Westchester), passed the Illinois Senate with a vote of 35-18, with one member voting present. The legislation will increase Illinois’ minimum wage to $11.00 per hour. With a minimum wage $1.00 higher than the federal minimum wage and $0.60-$1.00 higher than all neighboring states, Illinois businesses will be forced to reconsider staying in the state.

“The goal of the proponents is laudable, but we know that raising incomes begins with sound public policy decisions that are focused on creating jobs and encouraging employers to stay, expand and locate in Illinois,” said Rob Karr, president/CEO, Illinois Retail Merchants Association. “If we raise the minimum wage, increasing employers largest cost line-item by 25 percent, employers are going to be forced to make cuts, which will start with jobs. No employer’s sales are increasing by 25 percent, particularly in the retail sector, so they have no other choice. This does nothing to change Illinois’ economic reputation, and it further economically disenfranchises Illinois citizens – particularly those who are low-skilled and inexperienced.”

SB11 seeks to increase the minimum wage from $8.25 to $9.00 beginning July 1, 2015, and increase it by $0.50 each July until July 1, 2019. Across the country, cities and states with an increased minimum wage are feeling the effects. In San Francisco, a long standing bookstore and advocate for the minimum wage increase when San Francisco adopted it several years ago, is closing after realizing the increased minimum wage made continuing operations impossible. During a time when the economic recovery in Illinois is slow, the state simply cannot afford to run businesses across the border or force them out of business altogether.

Facts about the minimum wage increase:

  • Illinois’ minimum wage is already highest in the Midwest. The Illinois minimum wage is currently $0.60 – $1.00 per hour higher than all of our neighboring states. A minimum wage increase will only put Illinois in an even higher economic disadvantage.
  • Raising the minimum wage will continue to keep people, especially teens, out of jobs. The number of teens with a job in Illinois has fallen consistently over the last 10 years leaving only about a quarter employed now. Increasing the minimum wage will only keep teens further out of jobs.
  • Minimum wage salaries are a floor, not a ceiling. The National Restaurant Association notes, “9 out of 10 salaried restaurant workers, including owners and managers, started as hourly workers.”
  • Employers are already bracing for the uncertain effects of federal health care implementation in Illinois.  To comply with the Patient Protection and Affordable Care Act, analysts estimate approximately $3,000 in extra costs per employee. Adding a minimum wage increase on top of the extra healthcare costs will kill Illinois employers.

“The fact of the matter is, increasing the minimum wage to $11.00 per hour is a job-killing proposal that will drive businesses out of the state taking much needed jobs with them,” said Karr. “We need to work together to pass legislation that seeks to strengthen our economy and keep jobs in our state, especially for those who need them the most.”

About The Illinois Retail Merchants Association (IRMA)

One of the largest state retail organizations in the United States, IRMA serves as the voice of retailing and the business community in state government. Founded in 1957,IRMA represents more than 23,000 stores of all sizes and merchandise lines. From the nation’s largest retailers to independent businesses in every corner of the state, merchants count on IRMA to fight for the best possible environment in which to do business in Illinois.


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121 Report – CRMA – January 2015

Issue 1

RACE TO THE FINISH – 

CHICAGO’S ELECTED OFFICIALS ASK VOTERS FOR ANOTHER TERM

 

 Just when you thought election season was over, the city of Chicago kicked it in gear as Mayor Rahm Emanuel and most of the sitting Aldermen began their campaigns in earnest for re-election. The Municipal Election, which takes place on Tuesday, February 24th, will determine who will govern Chicago for the next four years. The Mayor, City Clerk, City Treasurer and all aldermanic seats are up at the same time. Working with a new map which reconfigures many wards and completely repositions one existing ward, Aldermen are working overtime to reach out to constituents old and new.

With the ballots all but set, the Mayor will be challenged by an interesting and diverse group of contenders: Willie Wilson, a medical devices supplier, former QSR franchisee and gospel singer; Bob Fioretti, current Alderman of the 2nd Ward and lawyer; Jesus “Chuy” Garcia, current Cook County Commissioner and former Chicago Alderman and State Senator, and Bill “Dock” Walls, a community and political activist and perennial mayoral candidate. To date, the Mayor’s campaign has released the results of a poll, taken in December, showing him ahead of the pack with a path to victory in February. We presume that there will be other groups that will produce independent polls as the election draws near and voters start paying more attention to the campaigns. Mayor Emanuel has agreed to five debates which are scheduled to begin on Tuesday, January 27th and end on Tuesday, February 10th.   Both City Clerk Susana Mendoza and newly appointed City Treasurer Kurt A. Summers, Jr. are running unopposed.

The contests for Alderman have proven to be a bit of a wild card. The following aldermen have either announced that they will retire at the end of the term, setting up open races in each ward, or have decided to leave their position for other reasons:

Ald. James Balcer (11)                                Ald. Michael Chandler (24)

Ald. Timothy Cullerton (38)                       Ald. Robert Fioretti (2)*

Ald. Toni Foulkes (15)**                            Ald. Nicholas Sposato (36)***

Ald. Latasha Thomas (17)

 

Six Aldermen will have no challengers:

Ald. Edward M. Burke (14)                        Ald. George Cardenas (12)

Ald. Jason Ervin (28)                                   Ald. Harry Osterman (48)

Ald. Marty Quinn (13)                                Ald. Brendan Reilly (42)

CRMA members should note that in order to win outright, a candidate must garner over 50% of the vote. If no candidate in a race attains the adequate percentage of votes to win, then the top two candidates with the most votes will compete in a run-off election on Tuesday, April 7th, 2015. In the last city election, about 1/5 of the City Council seats went to a run-off.

There have been a number of ward-based candidate forums and debates, mailers have started going out to constituents and the fundraising machine is in full-swing. A number of sitting Aldermen and challengers have reached out to CRMA to discuss their vision and ask for our support. CRMA joins with other representatives of the employer community in supporting voices in City Hall that provide balance in the face of an anti-job growth agenda pushed by some in the advocacy community. We look to support thoughtful leaders that will apply a common-sense and inclusive approach to governing. CRMA will continue to meet with candidates as the election nears to share ideas and thoughts about how we can work collaboratively in the future.

Click here for a full list of candidates.

*The new ward map created a completely new 2nd ward and Alderman Fioretti does not currently live in that ward. The Alderman has decided instead to challenge Mayor Emanuel.

**The ward map was drawn to pick up a larger Latino population. Alderman Foulkes decided to move into the 16th ward which is majority African American, and challenge the current Alderman, Joann Thompson. There are 3 other challengers in this race as well.

***This ward map was also drawn to include a larger Latino population. Alderman Sposato decided to move to the 38th ward which picked up a large part of his old ward. The current Alderman in 38, Tim Cullerton, will retire at the end of the term. Alderman Sposato will compete in this open race against 6 other candidates.

 

COOK COUNTY BOARD PROPOSAL TARGETS PERSONS WHO COMMIT 

WAGE THEFT OR VIOLATE THE FEDERAL FAIR LABOR STANDARDS ACT

Commissioners Jeffrey Tobolski (D-LaGrange) and John P. Daley (D-Chicago) propose that if a person has admitted or been found guilty or liable for wage theft or violating the FLSA Act repeatedly or willfully within 5 years of application, then the person will be deemed ineligible to bid for or enter into a contract with the County. In addition, such violations will make a person ineligible to receive property tax incentives or a General Business License for a willful violation or two or more violations that were not deemed willful.

Read the proposal here.

CITY COUNCIL ORDINANCES AND RESOLUTIONS

 

INTRODUCTIONS

Resolution to Prohibit Lobbying Activity During Council Meetings

Sponsors: Aldermen Bob Fioretti (2), Scott Waguespack (32), John Arena (45) and others

Committee on Committees, Rules and Ethics

This resolution would change the Rules of Order and Procedure prohibiting registered lobbyists from engaging in lobbying activities with Aldermen during City Council or any committee meeting, but it doesn’t seem to prohibit similar activities from those who are not registered. Members will note that the Cook County Board passed a similar law last year after the County Inspector General issued a report expressing concern over registered and “rogue” lobbyists attempting to talk to Commissioners during Board Meetings.  Interestingly enough, neither law targets contact between a person who is unregistered and essentially lobbying a Commissioner during a meeting.  The city proposal would also prohibit any elected official from lobbying Aldermen.

The proposal goes on to address the long-standing rule that Aldermen who are present at the time of a vote must indeed vote. They are not be allowed to vote “Present” or refrain from going on the record in any way if they are physically present in the Chamber and a member of the voting body. Although this policy would not change, there has been some recent concerns over Aldermen passing on votes without recusing themselves according to current rules. The change here clarifies that all eligible and present Aldermen must vote when the question is called.

Lastly, this proposal would allow deferred matters, which have not been reported back to Council within 60 days, to be called for a vote by any Alderman giving 48 hours written notice in advance of the next Council meeting.

 

Resolution to Call for Hearings Regarding Information Sharing Between Government and Private Companies Concerning Cybersecurity

Sponsor: Alderman Edward M. Burke (14)

Committee on Economic, Capital and Technology Development

With a nod to President Barack Obama’s recent State of the Union address, this resolution asks the city’s Department of Innovation and Technology and Office of Emergency Management and Communications to testify regarding ways they can help facilitate information sharing between the public and private sector regarding cybersecurity threats, responses and technical assistance.

 

Resolution to Urge the ICC to Reject the Proposal to Increase Heating Bills

Sponsor:  

Alderman Tom Tunney (44)

Committee on Finance

The gas utility for the city has asked permission from the Illinois Commerce Commission to increase rates and to raise the fixed charges on bills. At the same time that this resolution was being introduced, the ICC ruled to allow the rate increase, but rejected the attempt to increase the fixed charges.

 

Ordinance to Allow the Sale of Liquor Near Public Libraries

Sponsor: Alderman Edward M. Burke (14)

Committee on License and Consumer Protection

This proposal would allow the sale of retail alcoholic liquor within 100 ft of the main and regional libraries in Chicago. It would also allow for the requirement to be reduced per the permission of the Local Liquor Control Commissioner, if the reduction wouldn’t have a detrimental impact on the library.

 

Ordinance to Require Pregnancy Accommodations

Sponsors: Alderman Latasha Thomas (17)

Committee on Finance

This proposal adopts the language from the recently enacted IL law which expands pregnancy accommodations beyond the federal regulations and treats pregnant women as a protected class. It does not make any changes to the current IL law.

 

PASSED INITIATIVES

Ordinance to Add Classes for Prohibition on Profiling Based on Protected Class

Sponsors: Aldermen Will Burns (4), Michelle Harris (8), Edward M. Burke (14) and others

This ordinance adds national origin and gender identity to the classes of people that will be protected from unlawful profiling in an attempt to stop, question or detain someone in connection with an alleged crime. This change aligns with recent guidance issued by the US DOJ to include these classes as protected. While focused on peace officers, the ordinance will apply to security personnel as well.

EFFECTIVE DATE: MARCH 17, 2015

 

Ordinance to Allow All Airport Concession Employees the Right to Collectively Bargain and Require Airport Concessionaires to Abide by Labor Peace Agreements

Sponsors: Aldermen Walter Burnett (27), Daniel Solis (25), Bob Fioretti (2) and others

Citing the need to prevent labor disputes from impeding passenger access to food, beverages, reading materials and other items sold at the airport, this ordinance will require concessionaires to enter into collective bargaining agreements and abide by labor peace agreements. Small businesses are exempt. In this instance, a small business is an employer that employs less than 500 employees worldwide and employs fewer than 50 employees total at both airports.

EFFECTIVE DATE: MARCH 17, 2015

 

Ordinance to Require Pest Control for Demolition and Modification Projects

Sponsors: Aldermen Michele Smith (43), George Cardenas (12), Pat Dowell (3) and others

As any project that requires excavation disrupts habitats for rodents, this ordinance will require a rodent control management plan whenever such projects are initiated. The plan must be maintained by the owner until the construction at the site is completed and contain any documents or receipts from the structural pest control company.

EFFECTIVE DATE: MAY 16, 2015

Due to the February election, the City Council will not meet again until Wednesday, March 18, 2015.


Contact Information

TanyaTricheTanya Triche
Vice President & General Counsel
312/726-4600