Chamber Members:
I’ll take the blame for the snow day as I put all of my shovels away and said we won’t need these anymore. Today’s update takes a look at items such as the push for a smaller tax increase to cover infrastructure spending, Illinois Mayors pleading to keep share of income tax, a new families plan, Washington DC statehood, and the repeal of the SALT cap.
*Daily Coronavirus update brought to you by Silver Cross Hospital
Smaller Corporate Tax Increase Floated at White House Infrastructure Meeting
President Biden and a bipartisan group of lawmakers discussed alternative ways to pay for infrastructure spending, including a smaller increase in the corporate tax rate, as Republicans and Democrats aired possible changes to the size and scope of the package.
The White House has proposed raising the corporate tax rate to 28% from 21%, along with increasing taxes on U.S. companies’ foreign earnings, to cover the cost of Mr. Biden’s $2.3 trillion infrastructure proposal. At the meeting Monday, lawmakers and Mr. Biden discussed a more modest tax increase, according to multiple attendees.
Rep. Charlie Crist (D., Fla.) said lawmakers discussed the potential for some “compromise wiggle room” on raising the corporate rate to help pay for the plan. “You could see a 2 or 3% increase—maybe not all the way to 28 but 25,” he said of the percentage rate.
Mr. Biden has held a series of meetings with lawmakers of both parties about his proposal, which offers funding for improving transportation, expanding access to broadband, rebuilding schools and funding elder care, among other priorities. The White House has indicated Mr. Biden is open to breaking his proposal into smaller parts and is considering different ways to pay for it, amid a swirl of proposals from lawmakers of both parties.
“I am prepared to compromise, prepared to see what we can do and what we can get together on,” Mr. Biden said in the Oval Office as the meeting with 10 lawmakers and Transportation Secretary Pete Buttigieg got under way. “It’s a big package, but there are a lot of needs,” he said.
Republicans have indicated that they would want to focus on spending money on building roads and bridges, along with expanding access to broadband, while excluding other parts of Mr. Biden’s plan, such as providing $400 billion for caring for elderly and disabled Americans. Lawmakers at the White House Monday discussed whether certain provisions of Mr. Biden’s proposal should be considered infrastructure, with Republicans also moving to dissuade Mr. Biden from raising the corporate tax rate and instead focus on user fees.
The GOP lawmakers were “more in favor of user fees so that whoever was benefiting from that particular infrastructure project would be paying for it in the long run,” said Rep. Carlos Giménez (R., Fla.). Mr. Giménez said Mr. Biden indicated that he hoped to see a counteroffer from Republicans by mid-May. Gimenez also said Biden appeared open to coming down on the corporate tax increase he’s proposed. The Florida Republican expressed hope for a bipartisan agreement, saying both sides laid everything out on the table… but their differences may be too big of a gulf to build a bridge across.
“I think they would like to work on a bipartisan basis,” said Sen. Mitt Romney (R., Utah) of Democrats. “The challenge is going to be how it’s paid for, and we’ll see if we can cross that bridge.”
Another attendee, Sen. Jeanne Shaheen (D., N.H.), said the group also raised the possibility of creating a national infrastructure bank and closing the current gap between taxes owed and taxes paid to help bring in revenue for the plan.
Progressives are warning Biden not to get hamstrung in negotiations with Republicans, claiming they aren’t serious about actually coming to the table and claiming they are trying to prolong the talks for weeks on end in order to delay Democrats’ legislative push. “I personally don’t think the Republicans are serious about addressing the major crises facing this country. Maybe I’m wrong, but we’re certainly not going to wait for an indefinite period of time,” said Sen. Bernie Sanders (I-Vt.).
Mayors to Pritzker: Don’t Cut Our Take of Income Tax
Hoping to flex a little Springfield muscle, mayors representing hundreds of municipalities in metropolitan Chicago today launched a campaign to get lawmakers to stop dipping into the share of state income tax receipts meant for cities and villages, with hundreds of millions of dollars a year at stake.
There are distinctly mixed signs as to how the mayors will fare, with Gov. J.B. Pritzker’s office standing by its view that if municipalities want help, they ought to get behind his plan to close $900 million in “corporate tax loopholes.”
The call for help came in a press conference by groups representing mayors in DuPage, Lake, McHenry, and Will counties, and in the southern and north and northwest suburbs. Chicago Mayor Lori Lightfoot did not participate but sent a comment of support.
The mayors want full restoration of the share of income tax receipts they’re supposed to get. When the income tax was adopted under then-Gov. Richard Ogilvie, one of the selling points was that the proceeds were supposed to be shared, with municipalities getting 10 percent, the so-called local distributive share. But as the state has run into its own financial difficulties in recent years, legislators have grabbed a growing portion for state spending. Pritzker wants to cut the local share another 10 percent, or $152 million, in his fiscal 2022 budget. That would move the amount municipalities get from 10 percent of the take to just over 6 percent.
A Pritzker spokeswoman said the solution is simple: back the plan to close loopholes. Because some of those loopholes affect local tax collections, that step would generate $228 million a year for local governments, more than the proposed $152 million cut in the local distributive share. But Palos Hills Mayor Gerald Bennett likened that to “a shell game.” Instead of “using our money as some sort of leverage,” he said, Pritzker ought to restore the distributive share.
The groups are getting mixed signals out of Springfield as to whether the mayors will get what they want. “They’re kind of keeping it close to the vest,” he said. Somewhat more optimistic was Brad Cole, who heads the Illinois Municipal League. “In the General Assembly, we feel pretty good,” Cole said, pointing to $7.5 billion in COVID relief money the state is in line to get from the federal government. “We’re getting lots of positive feedback.” Cole said he has not seen signs Pritzker is willing to relent.
White House Closes in on ‘Families Plan’ Spending Proposal Centered on Childcare, Pre-K, and Paid Leave
White House officials are closing in on a large spending plan centered on childcare, paid family leave and other domestic priorities, according to two people aware of internal discussions. The package could amount to at least $1 trillion of new spending and tax credits, though details remain fluid.
The American Families Plan, the second part of the administration’s Build Back Better agenda, is expected to be unveiled ahead of President Biden’s address to a joint session of Congress on April 28, the people said. It follows the approximately $2 trillion jobs and infrastructure plan that the White House introduced this month and that is just beginning to be debated by Congress.
While details remained in flux, the White House’s newest plan is expected to call for roughly $1 trillion in new spending and approximately $500 billion in new tax credits, according to the people aware of the internal discussions, who spoke on the condition of anonymity to discuss private deliberations. Aides cautioned that the final details of the plan remained unsettled and were subject to change.
The measure is expected to be largely if not fully paid for with new tax increases centered on upper-income Americans and wealthy investors, the people said. The details of those tax measures remained unclear.
“President Biden has already put forward the first part of his historic plan to invest in the strength of America’s economy and families, and he’ll be outlining the second element of that proposal in the coming days,” Michael J. Gwin, a White House spokesman, said in a statement. “The details of that package are still being finalized, so speculation as to its final contents is premature at this point.”
The plan is expected to devote hundreds of billions of dollars to new programs that Biden highlighted during the presidential campaign and that are highly sought by Democrats in Congress. While final numbers had not been determined, the largest efforts are expected to center on roughly $225 billion for child-care funding; $225 billion for paid family and medical leave; $200 billion for universal prekindergarten instruction; hundreds of billions in education funding, including tuition-free community colleges across the country; and other sums for nutritional assistance, the people familiar with the matter said.
The tax-credits section includes an extension of the expanded child tax credit through 2025, the people said. The White House is set to reject pressure from a number of Democratic lawmakers — including Sens. Sherrod Brown (Ohio) and Michael F. Bennet (Colo.), as well as Reps. Suzan DelBene (Wash.) and Rosa L. DeLauro (Conn.) — to make the enhanced child benefit permanent. The expanded child tax credit, which offers families $3,600 per young child and $3,000 per older child, was first approved in the $1.9 trillion relief plan and is set to expire at the end of this year.
Biden’s infrastructure and jobs plan would be funded by more than $2 trillion in tax increases on corporations. By contrast, as The Washington Post previously reported, the tax increases in the families plan are expected to include higher rates on wealthy Americans and investors, in addition to beefing up enforcement at the Internal Revenue Service. IRS Commissioner Charles Rettig recently told Congress that the United States is losing roughly $1 trillion in unpaid taxes every year in large part because of tax evasion, particularly among the wealthy and corporations.
Taken with the jobs plan, Biden’s spending plans would amount to one of the most significant government transformations of the economy in decades. White House officials and congressional Democrats have not determined whether they will seek to move the jobs and infrastructure first or package it with the other proposal plan and try to pass both at the same time.
Republican opposition to the White House’s newest plan will probably be steeper than the opposition so far to the infrastructure proposal. The GOP is likely to oppose the tax increases and the spending provisions in the newest proposal, whereas Republicans in Congress do support parts of the physical infrastructure investments in the White House’s jobs plan.
Democrat Floats Paying for SALT Cap Repeal with More Tax Audits
Representative Josh Gottheimer said a repeal of the $10,000 cap on state and local tax, or SALT, deductions could be offset by cracking down on tax cheats, the first proposal from Democrats as a way to pay for revival of a valuable tax break.
The New Jersey Democrat said Monday that increasing funding for the Internal Revenue Service to boost enforcement efforts could yield enough money to pay for reinstating the full SALT deduction as well as a portion of President Joe Biden’s $2.25 trillion infrastructure package.
“We need the administration’s support to increase investment for enforceability,” Gottheimer said at a news conference in New Jersey on Monday. “There is a way to do this by going after what people owe already.”
He said he plans to send a letter to Treasury Secretary Janet Yellen this week that will make the case to give the IRS more tools to stop tax evasion and to use that recovered tax money to fund infrastructure plans and the cost of restoring the SALT write-offs. Former President Donald Trump capped the write-off in his 2017 tax law, a blow to many residents in states like New York, New Jersey and California who used the benefit to reduce their IRS bills.
Gottheimer, along with several other House Democrats and a few Republicans from high-tax states, have said they won’t support the administration’s infrastructure plan if it doesn’t address SALT. There are enough Democrats who have expressed support for re-instituting the full SALT deduction that they could block Biden’s proposal, unless House Speaker Nancy Pelosi can broker a deal.
White House Press Secretary Jen Psaki has said the administration is hesitant to back repealing the $10,000 cap on SALT deductions because it would cost money that could be spend on other priorities. Psaki said that lawmakers should come up with proposals to pay for the more generous deduction if they want to it to be a part of the bill. Restoring the full deduction would cost the government $88.7 billion in revenue for 2021 alone, according to the non-partisan Joint Committee on Taxation.
Gottheimer said he is co-sponsoring legislation from Representative Ro Khanna that would call for minimum audit levels on corporations and high-earning individuals as a way to close the tax gap, or the difference between the levies owed and what the IRS actually collects. Khanna estimates the bill could raise $1.2 trillion over a decade.
The White House, congressional Democrats and some Republicans have said they support boosting IRS enforcement as a way to raise more tax revenue without having to increase tax rates. IRS Commissioner Chuck Rettig told a congressional committee last week that the tax gap could be as high as $1 trillion per year, which is many multiples higher than previous agency estimates.
White House formally backs bill to grant DC statehood
The White House on Tuesday formally declared its support for a House bill that would grant statehood to Washington, D.C., saying it would provide the residents of the District with “long overdue full representation in Congress.”
“Establishing the State of Washington, Douglass Commonwealth as the 51st state will make our Union stronger and more just,” the Office of Management and Budget said in a statement of administration policy. “Washington, D.C. has a robust economy, a rich culture, and a diverse population of Americans from all walks of life who are entitled to full and equal participation in our democracy.”
The statement further called for Congress “to provide for a swift and orderly transition to statehood for the people of Washington, D.C.” White House press secretary Jen Psaki previously said President Biden is in favor of giving statehood to D.C. The District is home to roughly 700,000 full-time residents, which is more than Wyoming or Vermont.
The House is scheduled to vote this week on legislation to make D.C. the country’s 51st state, after Democrats pledged to prioritize it during Biden’s first 100 days in office. The bill passed out of committee last week in a party-line vote.
The House previously passed the bill last year, but it went nowhere in the GOP-controlled Senate. Even with Democrats now in control of both chambers, D.C. statehood faces an uphill, unlikely, climb to actually passing Congress.
Democrats would need the support of at least 10 GOP senators in order to advance a D.C. statehood bill without getting rid of the 60-vote filibuster. Even if Democrats changed the rules to require a simple majority — something they don’t currently have the support to do — only 44 Democratic senators have signed on in support of a statehood bill in the Senate.
Program Notices & Reminders – Expanded Information
Small Business Development Center (SBDC) at Joliet Junior College
Here are our upcoming no-cost webinars:
Government Certification Process (with Rita Haake at COD) on April 27th at 1pm
Certifications: Interpreting the alphabet to pursue profits! Which small business certification is the best one for you?
Your options:
• Federal: 8(a), EDWOSB, HUBZone, SDB, SDVOSB, WOSB, VOSB
• State: DBE, FBE, FMBE, MBE, PBE, VBE
• Local: DBE, MBE, WBE, VBE
You will learn the details of the application process, documentation requirements, certification options, and how to market and leverage certifications for the growth of your business.
Webinar: The Certification Process (ecenterdirect.com)
Small Business Administration Restaurant Revitalization Fund
SBA Administrator Isabella Casillas Guzman announced key details on application requirements, eligibility, and a program guide for the Restaurant Revitalization Fund (RFF). The restaurant industry has been among the hardest-hit sectors during the economic downturn caused by the COVID-19 pandemic. To help bring jobs back and revive the industry, the American Rescue Plan, signed into law by President Joe Biden, established the $28.6 billion Restaurant Revitalization Fund at the U.S. Small Business Administration (SBA). The SBA will administer the funds to the hardest-hit small restaurants.
Under this announcement, details on application requirements, eligibility, and a program guide are now available in English at www.sba.gov/restaurants or in Spanish at www.sba.gov/restaurantes.
Ahead of the application launch and over the next two weeks, the SBA will establish a seven-day pilot period for the RRF application portal and conduct extensive outreach and training. The pilot period will be used to address technical issues ahead of the public launch. Participants in this pilot will be randomly selected from existing PPP borrowers in priority groups for RRF and will not receive funds until the application portal is open to the public.
Following the pilot, the application portal will be opened to the public. The official application launch date will be announced at a later date. For the first 21 days that the program is open, the SBA will prioritize reviewing applications from small businesses owned by women, veterans, and socially and economically disadvantaged individuals. Following the 21-day period, all eligible applicants are encouraged to submit applications.
As the SBA builds and prepares to roll out the program, this dedicated SBA website is the best source for up-to-date information for eligible restaurants interested in the RRF.
Small Business Administration Shuttered Venue Operators Grant Program
Over the next few days, the SBA tech team and vendors will remain focused on testing the Shuttered Venue Operators Grant application portal; it will not reopen in the next few days, rather they are aiming to reopen the portal by the end of the week.
As we’ve shared, after their vendors fixed the root cause of the initial tech issues, more in-depth risk analysis and stress tests identified other issues that impact application performance. The vendors are quickly addressing and mitigating them and working tirelessly with the SBA team so the application portal can reopen ASAP and they can deliver this critical aid.
We have and will continue to share updates regularly. For the most current updates, continue to check SBA’s Twitter feed. And, again, applicants will have advance notice so they can be best prepared. For more information about the Shuttered Venue Operators Grant program, visit sba.gov/svogrant.
Small Business Administration Program: Economic Injury Disaster Loan Program (EIDL)
Effective immediately, applicants can send a request for reevaluation of a Targeted EIDL Advance application that was declined to the following email address:
TargetedAdvanceReevaluation@sba.gov.
Applicants should follow these instructions when requesting a reevaluation:
- Send an email to TargetedAdvanceReevaluation@sba.gov
- Use the subject line “Reevaluation Request for [insert your 10-digit application number]”
- In the body of the email, include identifying information for the application such as application number, business name, business address, business owner name(s) and phone number
- Important: Include an explanation and any documentation that addresses the reason for the decline, if available. SBA will contact applicants if additional documentation is required to complete the review.
Illinois SBA Programming
8(a) Orientation workshop/SAM Registration
This webinar will provide an overview of the 8(a) Business Development program, eligibility requirements, program benefits and training, steps to registering in the System for Award Management (SAM) database in order to do business with the federal government. Wednesday, April 21, 9:30 a.m.
Sign up
External Funding: Methods and sources of capital to fund your business
Join the International Trade Center to learn about loans and external funding options to run your business. The webinar will also discuss equity investments, using personal savings, credit lines, and other resources for your small business funding needs. Thursday, April 22, 9 a.m.
Sign up
Small Business Development Center Webinar: COVID-19 Financial Assistance for Small Businesses and Non-Profits
Join the Champaign County EDC for guidance on the different financial assistance options available to small businesses and non-profits in Illinois. This webinar, led by SBDC Director Don Elmore, will cover details about the newest round of economic aid being administered by the SBA for small businesses, including the Paycheck Protection Program (PPP), Economic Injury Disaster Loan (EIDL) program, and the SBA Debt Relief Program. The webinar will also note other financial options currently available to small businesses and non-profits. Thursday, April 22, 10 a.m.
Sign up
Illinois DCEO Updates
Team RED will be hosting numerous program webinars in addition to the PPP webinars noted above over the next few weeks. Please join us and learn about these programs. While different team members from around the state are hosting the webinars, they are open to anyone to attend. You can view the full list of upcoming events on our website here.
Export Finance: Getting Paid, Currencies and Insurance
Date and Time: April 19, 2021, 12:00-1:00PM CST
Exporting involves choices about currencies, risk, and credit. Join our webinar that walks you through the pros and cons of different options with these topics.
To register go to: http://bit.ly/2M7cWWQ
Advantage Illinois Loan Program for Small Businesses
Date and time: Wednesday, April 21, 2021 10:00 am
Please join Jacqueline Franklin, Assistant Deputy Director of the Illinois Department of Commerce and Economic Opportunity’s Office of Regional Economic Development for a webinar to learn more about the Advantage Illinois Loan Program. This program enhances capital for Illinois businesses, which is a top priority. By working with the state’s banking community and venture capitalists, DCEO will help entrepreneurs and small
businesses start-up, expand, and create new jobs at a faster rate.
Register Here: https://bit.ly/3mJqc1W
Business Enterprise Program (BEP)
Date and Time: April 22, 2021, 1:30-2:30 pm
BEP assists businesses owned by minorities, women, and people with disabilities gain access to the State of Illinois procurement process. BEP certification with the State of Illinois can also open the door to opportunities with other public and private entities which are looking for diverse suppliers.
Register Here: https://illinois.webex.com/illinois/onstage/g.php?MTID=e0f90a95eaab454a002b23a3c652d1f72
Finally, make sure you get your RSVP in to join us at our first Business After Hours / Open House for our new Chamber office. Hope to see a good number of you next Thursday, April 29th.
Stay well,
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Mike Paone
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
mpaone@jolietchamber.com
815.727.5371 main
815.727.5373 direct