We are now a little over halfway through special session. Lawmakers have a few days left to pass a comprehensive budget plan before Illinois' reputation - and business climate - is hurt even further. The Illinois Chamber of Commerce believes that it is crucial a plan, with proper reforms, is passed before the start of the new fiscal year July 1.
In a letter given to lawmakers today, the Illinois Chamber of Commerce calls on members of the General Assembly to incorporate key changes and additions in the budget plan proposed on June 14 by Republican caucuses and the Governor. There are topics not mentioned in the letter that the Illinois Chamber of Commerce supports in the plan, such as, the property tax freeze as well as other items. The Republican plan, with adequate changes, is the best framework available for a conclusion to the impasse.
Please see below to read the full letter addressed to lawmakers.
While the Illinois Chamber of Commerce acknowledges the hard work of the Governor and General Assembly, the Chamber urges each and every legislator to work for a final resolution of the unprecedented budget impasse this week. I know that we all recognize the terrible toll the lack of a state budget has had on our employer community, our institutions and our reputation.
The need for real reform of government and the Illinois jobs climate remains critical but, finally, meaningful progress on reforms
and a balanced budget appear within reach.
The Chamber believes that the framework for a budget resolution laid out by the Republican caucuses and the Governor on June 14 - largely built upon the package passed by Senate Democrats in May - is the best framework available for a conclusion to the impasse. However, this framework is far from perfect nor is it complete.
The Chamber calls for the following changes and additions in order to support a final package:
- Omit the Unconstitutional Service Tax. SB 9, the most recent legislative proposal to tax certain services is unconstitutional. The Illinois Supreme Court, in the case of Fiorito v. Jones held unconstitutional - for lack of uniformity, and for denial of due process and equal protection guarantees - a prior attempt to impose a tax on a limited number of services. The recent amendment imposing a tax on a specific list of services (as opposed to all services) would immediately be subject to constitutional challenge.
- Stop the Road Fund Raid. Both Senate Democrat and Republican proposals would take $266 million out of the Road Fund and shift the bulk of it to Chicago area mass transit. While transit is a priority, this is an unprecedented use of the Road Fund and will result in a $1 billion reduction in IDOT's latest multi-year plan for roads and bridges.
- Include a Transportation "Bridge the Gap" Proposal. Transportation funding is set to fall off a cliff at the end of this construction season. The legislature can maximize the impact of modest increases in road fund revenues by bonding them. This would increase transportation funding over the next two years until a larger, more permanent fix to this problem is found.
- Pass a Clear Plan for Reducing the Bill Backlog - While the Chamber is an advocate for more efficiencies in government and greater respect for taxpayer dollars moving forward, the state simply must pay debts already incurred. Though not optimal policy, new bonding, backed by a dedicated revenue source, is the best way to jump start a return to fiscal sanity.
- Improve the Workers' Compensation Reforms. While modest, the amendments to the workers' compensation act contained in HB 4068 do represent incremental progress. However, the language related to "traveling employees" must be strengthened and new employer penalties related to electronic filing must be reasonable.
- Rebalance the Tax Mix. Given the right package, the Chamber can support a major tax increase to help produce a balanced budget. However, the current tax package unduly burdens specific industries and ignores our largest job creator, small business. A final tax package should omit a decoupling from the Domestic Production Activity Deduction (a change impacting agriculture, manufacturing, technology and others), eliminate the unfair taxation of satellite and internet streaming services, and create a new incentive for small businesses to invest and grow in Illinois.
The Chamber stands ready to work with all legislators and the Governor to find a resolution to the current budget crisis. The time for a resolution is now.