Today is Thursday so that means unemployment report day on the national level. We also officially have a budget in Illinois for the next year as Governor Pritzker has signed the bill to make it official. See below for more news on PPP, Main Street lending, the Stock Market, and more.
More than 1.5 million Americans filed new claims for unemployment benefits during the first week of June, according to Labor Department data released this morning. There was also 705,000 plus that filed for Pandemic Unemployment Assistance. This is the program for those that do not qualify for regular unemployment insurance if they lost their jobs as part of the pandemic.
Treasury Secretary Steven Mnuchin today talked about the possibility of extending the PPP funds that are set to expire at the end of this month. If it were to be extended though, he was clear that changes need to be made that those employers that need it the most are taken care of.
Mnuchin said that extremely specific criteria (more than in place now) will need to be set up. As businesses reopen or are still planning to reopen in some cases, additional relief could be needed. Lawmakers are considering ways to make sure the hardest hit employers and those that may be traditionally underserved by the banking industry have access to the aid. There is growing bipartisan support for letting some ailing small businesses seek a second loan.
Main Street Lending Program Webinar Announced
The Federal Reserve is pleased to announce the following information session for potential borrowers in the Main Street Lending Program on Monday, June 15 at 1:00 pm:
“Main Street Lending Program Updates for Potential Borrowers”
The webinar is an opportunity for potential borrowers in the Main Street Lending Program to learn about changes to the program that we talked about yesterday. Officially from the Federal Reserve will be taking and answering questions. The program is intended to help businesses that were in sound financial condition prior to the onset of the COVID-19 pandemic maintain operations and payroll until conditions normalize. Interested participants are encouraged to review the updated program term sheets and frequently asked questions. The FAQ sheet is also attached to this email.
Liability Protection Need
Amusement parks, salons, real estate agents and gyms around the country have begun requiring customers and workers to sign liability waivers pledging not to sue if they become infected with the coronavirus. This is an item that is on the top of the list as we’ve talked about in the next funding phase. Talk has centered around OSHA putting together federal guidelines so that the same standards for precautions are the same from state to state.
Ups and Downs of the Stock Market
A few days ago, we shared the uplifting news of the S&P getting back to pre-covid levels and the NASDAQ hitting new highs. Now, stocks today on Wall Street were heading for their sharpest daily drop since early April, retreating after a good rally as investors considered economic forecasts and an uptick in new cases in parts of the United States.
State Budget is Official
Governor Pritzker quietly signed into law the new state budget yesterday covering $42.9 billion that is built around borrowing up to $5 billion from the Federal Reserve to make ends meet in the new fiscal year that starts July 1. Back at the end of May during the special session, budget negotiators said they considered cutting across the board to balance the budget. Unfortunately, they said that would have required 35% reductions which were deemed excessive. They also discussed the idea of passing a lump sum budget which would have given Pritzker virtually unrestricted control to decide where and how much to spend. That idea, too, was rejected, although the budget that was approved gives the Governor broader authority to move money around than he now has.
The budget provides for the full payment required next year to the state’s pension systems. No additional money is being added to the school funding formula to continue the 10-year phase-in of the revised funding formula that provides more money to needier school districts. However, no district will get less money next year than it currently receives. More money is being allocated to Medicaid services and to the Department of Public Health because of increased costs associated with the coronavirus. Additional money is also allocated to the Department of Children and Family Services to hire more investigators and to give rate increases to providers.
Illinois Capital Plan
A reduction in motor fuel tax revenue caused by lower traffic during the coronavirus pandemic could delay some Rebuild Illinois capital improvement plan projects but none have been cut, according to Acting Illinois Department of Transportation Secretary Omer Osman. Osman said figures for March and April showed a major drop, and they are still waiting for May numbers. However, he said reopening the economy is increasing travel and related revenue.
The Restore Illinois program is supposed to remain as passed and no projects to date have been dropped. Depending on the tax decline, some projects may end up being delayed. We’re supposed to hear in the next few weeks which projects will be started during the next fiscal year.
Finally, here is a link to the newest 2-minute drill video from Illinois Chamber President & CEO Todd Maisch as he compares the GDP growth of states with and without progressive income taxes as we move towards the November ballot item. https://youtu.be/dLBvJhWWaqo
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
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