Clark Kaericher | Vice President, Government Affairs | 217-522-5512 x 296

May 29, 2020

The Infrastructure Council is an initiative of the Illinois Chamber that brings together Chamber members with a focus on increasing infrastructure investments in a strategic and thoughtful way to boost the overall business climate in Illinois. Our focus is on the public and private systems that are essential to Illinois businesses. 


Even if you'd have been around since the first session in the Capitol building in the 1880s, you'd have never seen a legislative session like the one that just concluded. Actually, if you'd have been at the capitol this year, you'd have missed most of it as the House met at a nearby convention center with tables 6 feet apart. The Senate did meet in the Capitol, but they used a social distancing voting measure which increased voting times so much on even the most mundane measures that viewers could feel themselves aging as they watched. Must-see tv, it was not. Yet nearly one week later, lawmakers still can't decide whether or not they voted to increase their pay.   
 
Here's what we do know passed: a budget (more below), reappropriated capitol money, various sunsets were extended (including for Lyft and Uber to operate for another year), workers' compensation and unemployment insurance changes were adopted, progressive tax language was adopted and a healthcare assessment was agreed upon.   
 
The 7 Billion Dollar Question...The FY2021 Budget  
On a party-line vote, Democrats sent Gov. Pritzker a $43 billion budget, which is over $2 billion more than the FY20 budget that passed last year. With state tax revenues having plummeted to $36.8 billion, nearly $5 billion of the $36.8 billion in tax revenues comes from new borrowing from the Federal Reserve authorized by the CARES Act. Democrats tout the approved budget as one that prioritizes public health and safety and vital services. Republicans are critical of the spending levels given the uncertainty of future revenues.  
 
Senator Durbin and the Illinois delegation now have their work cut out for them. The pressure is on for them to deliver the federal aid to Illinois to balance this budget. The clock is ticking as bond markets are watching and Illinois is dangerously close to junk bond status. Plus, the interest on this borrowing, even at extremely low rates, will be something like $200 million. That is real money. 
To be fair, Illinois received something around $4 billion annually after the 2008 recession. Counting for inflation, and facing an arguably worse financial crisis, $7 billion may not be unreasonable. Governor Pritzker, and his legislative allies, better hope it is not.  
 
What Does This All Mean for Transportation Funding? 
Despite the unprecedented hit to state revenues, the budget included $41.5 billion for capital reappropriations. All bonding included in the capital bill from last year was preserved.   
 
The budget also includes $3.6 billion for new capital appropriations. $2.9 billion of that will be given to IDOT in pay-as-you-go spending for the annual road program, as well as funding for airports, grade crossings, mass transit, and high-speed rail.  
At one point, the Budget Implementation Bill (known as the BIMP) included a $100 million line item for mass transit funded from the Road Fund. Transportation advocates were able to spot this change and lawmakers changed the funding source to the General Revenue Fund (GRF)  
 
Transportation Legislation that Passed 
  • A clean sunset for Uber and Lyft. The Chamber lobbied for a clean extension of the Transportation Network Providers Act (TNPA). The TNPA was set to sunset at the end of the calendar year. The Illinois Trial Lawyers Association made a late push to take away critical liability protections from the ride-share companies. Despite this push, a clean extension was passed preserving the protections for another year with HB 2174 (Willis/Jones). 
  • Capitol Appropriations at prior levels and no road fund raids 

Transportation Measures that Failed to Advance...Yet 
The following is a sample of some of the Transportation proposals introduced this year. Just because they did not advance this year, does not mean they won't be resurrected this November or next session.  
 
  • SB 2294 (Hastings) removes the employer exemption under the Employee Sick Leave Act from employers subject to the federal Railway Labor Act. Despite the name, the bill was a mandate on airlines and the Chamber helped successfully defeat it 
  • SB 3292  (Villivalam) amends the Architectural, Engineering, and Land Surveying Qualifications Based Selection Act providing that the term of any member of a selection committee created by the Department of Transportation to select firms to provide architectural, engineering, and land surveying services prior to January 1, 2021, shall be terminated on December 31, 2020. Provides that beginning on or after January 1, 2021, the Department of Transportation shall appoint selection committees consisting of 9 members who shall be appointed with the advice and consent of the Senate. Effective immediately. The current board works well and this attempt to politicize selection does not bode well for non-political, data-driven funding decisions. 

End of Session Report 
You can view the Chamber's complete 2020 End of Session Report here.

Reopen Illinois
Since the start of the public health emergency, Governor Pritzker has issued 37 Executive Orders (with more expected in the coming days, weeks, and months). Prior to the special session, the Governor's executive authority had become an increasing focus of lawmakers - particularly Republicans - who believed that the legislature's continued hiatus allowed the Executive Branch to continue making important policy decisions without appropriate legislative input. The Governor's executive authority has also become the source of an increasing number of lawsuits filed challenging his authority - many of which are still pending - but as lawmakers returned to Springfield, it was expected that his authority, including his plans to reopen the state under the Restore Illinois plan, would be a focus of legislative activity. 

The Illinois Chamber working with Senate Republican Leader Bill Brady introduced  SB3993 to establish safe place of business protocols on or before May 30, 2020. It also amended the Illinois Emergency Management Agency Act to provide that after an initial proclamation declaring that if a disaster exists, the Governor may only extend that declaration or make further proclamations regarding the same disaster if the General Assembly passes a resolution within 5 calendar days that approves the extension or further proclamation. For emergencies that prevent the reconvening of the General Assembly, an extension may be granted with the written consent of the four legislative leaders. This would require a bipartisan agreement in order to extend an emergency order.   
   
While the General Assembly did not take any sweeping action to formally solidify the Governor's emergency authority powers, including the ability to issue multiple emergency declarations after the initial 30 days, nor did they make any statutory changes to the Governor's reopening plan, the General Assembly did pass an omnibus bill that included authorization of limited oversight over the plan.  SB 2135, as amended, contained a number of provisions of note summarized below, but it was only able to pass out of the General Assembly after the House removed two controversial provisions that would have allowed the Legislature to convene and vote remotely, as well as allowed for the temporary delay of Freedom of Information Act (FOIA) requirements. As passed, HB 2135 includes:  
  • A new Restore Illinois Collaborative Commission to "participate in and provide input on plans to revive the various sectors of the state's economy in the wake of the COIVD-19 pandemic." The commission will consist of 14 appointed lawmakers (8 Democrats and 6 Republicans) in collaboration with the Department of Commerce and Economic Opportunity (DCEO). Meetings may be convened to address revitalization efforts for the various sectors of the state's economy. DCEO will be required to provide monthly reports to the General Assembly regarding "current and proposed" revitalization efforts. The first report is due July 1.  
  • Creation of a 10-person task force of members representing the Department of Insurance and the insurance industry to study business interruption insurance.  
Progressive Income Tax Constitutional Question Wording 
Lawmakers also approved  Senate Joint Resolution 1 , which contains the wording for a graduated income tax ballot question that will also be mailed to voters ahead of the November election. Per the resolution, the language will include a background explanation to voters, along with presentations of the arguments for and against the proposed constitutional change. The Illinois Chamber helped craft the arguments against the proposal.  
  
The Illinois Chamber also participates in a coalition of organizations opposing the constitutional amendment to change our income tax system from a flat tax to a progressive tax. Members can access resources to educate their employees, family members, friends, and neighbors as to why they should vote "NO" on the constitutional change. Go to www.noprogressivetax.com
 
Articles of Interest  
Pritzker says lawmakers took "significant actions" to help state:  https://www.bnd.com/news/politics-government/article243007586.html  
Edwardsville area chamber sues Pritzker over stay at home orders:  https://www.bnd.com/news/politics-government/article243007586.html  
One bright spot out of this pandemic, cocktails to go:   https://newschannel20.com/news/local/illinoisans-will-soon-be-able-to-order-cocktails-to-go
 

Until next time,   
 
Clark  

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