The week we’ve all been waiting for is here as full economic reopening should happen this Friday, June 11 unless some unforeseen circumstance pops up. That though is unlikely as today we’re under 250 cases in Illinois. Utterly amazing numbers looking back on the last 14+ months. Below we have the information to go by for the opening of Phase 5.
Also, what will the state do with funds not committed to from the American Rescue Plan, President Biden not looking to extend extra $300 for unemployment, daily notes on infrastructure talks, and some interesting incentives for vaccinations.
*Daily Coronavirus update brought to you by Silver Cross Hospital
Governor Pritzker Issues Guidelines for Illinois Reopening on June 11
Following weeks of steady decreases in new positive COVID-19 cases and with over 67% of residents age 18 and older receiving their first vaccine dose, Governor JB Pritzker is releasing guidelines for Phase 5 of the Restore Illinois plan, which will go into effect on June 11th and marks a full reopening of all businesses and activities. This guidance will mean businesses, large-scale events, conventions, amusement parks, and seated-spectator venues, among others, will be able to operate at full capacity for the first time since the onset of the COVID-19 pandemic. The State is also lifting the outdoor mask requirement in schools in accordance with the Centers for Disease Control (CDC).
This guidance comes as Illinois has recently reached a test positivity rate of less than 2 percent, more than half of the population has been fully vaccinated, and key hospitalization metrics have been declining since early May.
“After a tremendously challenging year, Illinois has now reached a defining moment in our efforts to defeat COVID-19,” said Governor JB Pritzker. “Thanks to the hard work of residents across the state, Illinois will soon resume life as we knew it before – returning to events, gatherings, and a fully reopened economy, with some of the safety guidelines we’ve adopted still in place. As we fully reopen, this administration remains laser focused on ensuring a strong recovery for our small businesses and communities. Our FY22 budget invests $1.5 billion in small business relief, tourism, job-creating capital projects and more and we look forward to getting these dollars to communities across our state as quickly as possible.”
Upon entering Phase 5, fully vaccinated people can resume activities without wearing a mask except where required by federal, state, local, tribal, or territorial laws, rules and regulations, including local business and workplace guidance. The State will continue to recommend masking for unvaccinated persons and require it for all people while traveling on public transportation, in congregate settings, in health care settings, as well as in schools, day cares, and educational institutions pursuant to the Illinois Department of Public Health (IDPH) and CDC guidance. Businesses and local municipalities can put in place additional mitigations as they deem appropriate.
Under Phase 5, all sectors of the economy can resume at regular capacity. Phase 5 also marks the return of traditional conventions, festivals, and large events without capacity restrictions. Large gatherings of all sizes can resume across all industry settings, and Phase 5 removes requirements that businesses institute mandatory social distancing in seated venues as well as daily health screenings of employees and visitors. Businesses and venues should continue to allow for social distancing to the extent possible, especially indoors. Businesses and venues may also continue to put in place additional public health mitigations as they deem appropriate, including requiring face coverings.
“This pandemic has robbed us of many of our freedoms such as going to ball games and concerts, celebrating graduations, weddings, and birthdays, going to dinner with friends, and even sharing a hug with loved ones we don’t live with,” said IDPH Director Dr. Ngozi Ezike. “The vaccine is giving us our freedoms back and allowing us to move to Phase 5. Let’s keep the vaccination momentum going so we can put this pandemic in the rearview mirror and not look back.”
While the entry to Phase 5 signals an end to business and activity specific guidance requiring social distancing, health screening and other required operational shifts, Illinois will continue to recommend face coverings for unvaccinated persons, as well as all individuals while (1) on planes, buses, trains, and other forms of public transportation and in transportation hubs, such as airports and train and bus stations; (2) in congregate facilities such as correctional facilities, veterans’ homes, and long-term care facilities, group homes, and residential facilities; and (3) in healthcare settings. In addition, the guidance for schools is updated to align with the CDC guidelines, including lifting the requirement for individuals to mask outdoors in most situations.
The State’s advancement to Phase 5 builds on last month’s announcement of the return of conventions and leisure travel to the state. Just last week McCormick Place announced its plans to re-open, bringing 122 events, 1,000 workers and an expected 1.9 million convention goers to their halls. Additionally, the State has recently launched a new tourism campaign to welcome out of state visitors back into communities, helping support a return to leisure activity as well as the important economic activity stimulated by Illinois’ iconic attractions, hotels and tourism businesses.
“The State’s move to Phase 5 next week marks a significant milestone in our efforts to bring businesses and workers back safely and will play a key role in getting the economy back on track,” said DCEO Acting Director Sylvia Garcia. “Under Governor Pritzker’s leadership, we are making steady progress in stabilizing our businesses and communities hit hardest during the course of the pandemic. New investments in the Governor’s budget will ensure that the state continues to play a vital role in aiding in the emergency response, while laying the groundwork for a sustained economic recovery.”
Earlier this week the Governor announced another $1.5 billion in funds to be made available through the FY 22 budget to support business grants, tourism recovery, workforce recovery, affordable housing, violence prevention, capital projects, and other investments throughout Illinois communities. This builds on the State’s record $580 million investment last year to deliver thousands of business grants through the Business Interruption Grants program, which provided emergency relief dollars to business grants and childcare providers in over 98 counties statewide.
Illinois Budget Leaves Billions in Federal Rescue Funds on the Table, So What Next?
The federal government will soon give the cash-strapped state of Illinois $8.1 billion to cope with the fallout from the COVID-19 pandemic, but next year state officials plan to use less than a third of the windfall. That means that some $5.5 billion in unspent federal cash will remain in state accounts until lawmakers figure out how they want to use it. The state treasurer’s office will invest the money, along with the $38 billion it is already responsible for investing.
Ironically, Illinois is supposed to get its money faster than many other states because of its urgent need. Most states will get their money from the American Rescue Plan Act in two payments, a year apart. But Illinois is expected to get its full share all at once in the coming months, because it has a high unemployment rate.
The fact that Illinois is letting so much money sit in the bank, even when it has a long list of pressing financial needs, has a lot to do with the rules the federal government wrote for how states can use the Rescue Act money. For example, states can’t use it to pay down their pension obligations. For Illinois, that means it can’t chip away at its $141 billion in unfunded pension liabilities. Nor can states sock the money away in a rainy-day fund because of federal restrictions.
“Eligible uses … would not include contributions to rainy day funds, financial reserves, or similar funds,” the U.S. Treasury explained last month. The Rescue Fund money is “intended to help meet pandemic response needs and provide relief for households and businesses facing near- and long-term negative economic impacts,” the agency explained. “Contributions to rainy day funds and similar financial reserves would not address these needs or respond to the COVID-19 public health emergency but would rather constitute savings for future spending needs,” it added.
Gov. JB Pritzker and other state leaders had hoped they could use the federal money to pay back low-interest loans the state took from the Federal Reserve last year. But the U.S. Treasury said no to that as well. Paying off those debts, it said, “[does] not directly provide services or aid to citizens.” Comptroller Susana Mendoza pushed the Treasury to reconsider. She argued that the borrowing was “essential for the continued performance of government services during the most challenging times for the state’s cash flow during the pandemic, all directly related to the COVID-19 crisis.” The Treasury has not responded or finalized its rules. But Illinois leaders needed a plan in order to meet the state’s budget deadline of May 31.
So now, state leaders say they are paying back the Fed the $2 billion Illinois owes the central bank anyway. But they had to find a different way to pay for it, primarily with funds from the surge in revenue the state saw over the last year. The Rescue Act also specifies that states cannot use the federal relief funds to pay for tax cuts.
When the Democrats wrote the state’s $42 billion budget for the upcoming fiscal year, they specified how to use $2.5 billion of the Rescue Fund money. The budget includes $1.5 billion for programs that deal with the effects of the pandemic, such as public health, affordable housing, business relief, mental health services, utility assistance and violence prevention initiatives. Democratic lawmakers also directed $1 billion to speed up capital projects that were already in the pipeline.
“This gets some money out the door right away to assist those still immediately impacted by the pandemic, while giving us time to strategize on the best uses for the remaining dollars,” Rep. Greg Harris, a Chicago Democrat, said in a statement. Pritzker said it was important that the Rescue Fund dollars went to trying to revive the Illinois economy. “Republicans wanted to use our one-time COVID relief funds to kick the budget can down the road and give favors to wealthy business interests. Instead, those dollars should be used to bring real relief to working families and spur economic recovery and safety in our communities,” the governor said.
Republicans, though, balked at how Democrats are using the federal money. “What’s not in this budget is any funding to pay down the debt we have in our unemployment insurance trust fund,” said Rep. Tom Demmer, a Republican from Dixon. “The reality today is that we have $5 billion in debt in the trust fund that is directly related to COVID.”
When unemployment rates shot up last year, Illinois, like many other states, did not have enough money in its unemployment trust fund to cover all the claims. So it borrowed the money from the federal government. Illinois owes the federal government $4.7 billion for unemployment benefits. It’s one of 19 states borrowing money to make those payments. Only California, New York and Texas owe more.
“That could be solved,” Demmer said, “with a one-time payment into the unemployment insurance trust fund, funded by the same federal dollars that helps states recover from the pandemic.”
If lawmakers don’t address the problem, people who get unemployment insurance could see a drop in their benefits. Meanwhile, the employers who pay into the trust fund could see their rates go up. Plus, the state would have to pay interest on the debt until it is paid down, Demmer said.
When the U.S. Treasury issued draft rules for how states can use their Rescue Fund dollars, it specifically said that states could use the money to pay down their unemployment insurance debts. “These impacts were driven directly by the need for assistance to unemployed workers during the pandemic, replenishing Unemployment Trust Funds up to the pre-pandemic level responds to the pandemic’s negative economic impacts on unemployed workers,” the Treasury officials explained.
President Biden OK with $300 Unemployment Supplement Expiring
President Joe Biden is comfortable with a $300-per-week federal unemployment benefit lapsing on Labor Day as scheduled. Biden, delivering remarks on the May jobs report from Delaware Friday, said the temporary boost in unemployment benefits has “helped people who lost their jobs through no fault of their own, and who still may be in the process of getting vaccinated.”
“It’s going to expire in 90 days. That makes sense,” Biden said. A number of economists as well as private sector contacts surveyed by the Federal Reserve in its latest “Beige Book” report on economic conditions have said generous unemployment benefits have been a contributing factor in labor shortages reported by employers, along with childcare and lingering concern over health risks.
Several Republican governors have decided to stop accepting the pandemic unemployment assistance, arguing that it has discouraged workers who are receiving more money in unemployment assistance than they were paid in their jobs from returning to work.
The March coronavirus relief law extended the pandemic unemployment assistance program — initially enacted in spring of 2020 to supplement state benefits for workers who lost their jobs due to COVID-19 — to Sept. 6. The initial federal benefit Congress enacted was $600 per week, but lawmakers let that lapse last July. When Congress finally passed another relief bill in December that renewed the program through mid-March, lawmakers halved the benefit to $300 per week.
Democrats initially planned to renew it at $400 per week, but they settled on $300 in the March law to appease moderates like Sen. Joe Manchin III. The West Virginia Democrat said at the time he would not be inclined to approve another extension. Brian Deese, director of the White House’s National Economic Council, confirmed during Friday’s press briefing that Biden thinks it’s “appropriate” for the enhanced unemployment benefits to expire as scheduled.
Biden had proposed in his $1.8 trillion paid leave, childcare and education plan looking at so-called automatic stabilizers that would tie unemployment benefits to economic conditions so that in the event of another recession, assistance would get out more quickly.
The Congressional Budget Office scores automatic stabilizers as having an enormous cost, lawmakers have said, which is among the reasons Democrats have not included them in prior relief bills.
Senate Finance Chair Ron Wyden has been among those pushing to tie unemployment assistance to economic conditions. In a statement Friday, he called cost concerns an “obstacle” to automatic stabilizers, adding that’s partly why Congress included “the arbitrary September cut off” for pandemic unemployment assistance in the last aid package.
“I’m going to continue to monitor the economic recovery and am particularly concerned about the workers whose income would go to zero if the programs for gig workers and those who have exhausted state benefits expire,” the Oregon Democrat said. “A complete overhaul of the unemployment insurance system is the only way to effectively address these issues over the long term.”
Daily Update on the Infrastructure Talks
White House and congressional negotiators are staring down a key week for infrastructure talks, with officials hoping to make some progress as Biden prepares to begin his European itinerary with departure on Wednesday.
A trio of Biden administration officials — Commerce Secretary Gina Raimondo, Granholm and Transportation Secretary Pete Buttigieg — appeared on the Sunday shows to acknowledge daylight between the White House and Senate Republicans, but to lower expectations for an announcement of a firm strategy to move a measure through the Senate. Both sides continue to hold out hope that a bipartisan deal can be struck, with Biden and Sen. Shelley Moore Capito (R-W.Va.) set to speak again today.
“This is not do or die,” Raimondo told ABC’s “This Week” of the upcoming week. “There’s no hard-wired deadline. … We won’t do this forever, but right now there are good-faith efforts on both sides, and we’re going to continue the work of doing our job and trying to get a bipartisan agreement.”
Today’s discussions between Biden and Capito take place after the president rejected the GOP’s latest offer last week, which boosted a $928 billion proposal by roughly $50 billion. The White House had slashed its initial $2.3 trillion price tag all the way down to $1 trillion last week, with how to pay for the package remaining a key sticking point.
No matter, talks are plowing ahead. But officials warned that negotiations need to ramp up sooner rather than later. “This has got to be done soon,” Granholm told CNN’s “State of the Union,” declining to put a specific date on when a resolution is needed. Buttigieg said last week that a clear infrastructure strategy needed to be in place by today (CNN).
Sen. Joe Manchin (D-W.Va.) maintained on Sunday that a bipartisan deal is the avenue forward for the upper chamber rather than a reconciliation package featuring only Democratic votes. He added that he was “very, very confident” that would be the path ahead (The Hill).
Biden Faces Challenge with Democrats on Infrastructure Package
President Biden faces hurdles toward getting consensus among Democrats on an infrastructure package, regardless of if it’s bipartisan legislation or if Democrats pursue legislation on their own.
Progressives are getting frustrated with Biden’s ongoing talks with Republicans and want the White House to start to pursue an infrastructure package that could pass without GOP support through the budget reconciliation process. But some Democrats have raised concerns about aspects of the tax proposals Biden has floated to pay for infrastructure legislation, so reaching a deal won’t necessarily be smooth sailing even if the president isn’t focused on attracting Republican support. Some Democrats have also brought up issues with Biden’s tax proposals that relate to regional interests.
It will be important for Biden to have congressional Democrats united behind an infrastructure package since the party only narrowly controls the House and the Senate, and even if there’s a bipartisan bill, support from Democrats will be critical because there may still be opposition from some Republicans.
Biden and the lead Republican negotiator, Sen. Shelley Moore Capito (R-W.Va.), met on Wednesday and spoke on the phone on Friday. They are planning to talk again on Monday. Capito on Friday floated a new offer to Biden that included an additional $50 billion in spending compared to Republicans’ previous offer, but the proposal was not satisfactory to the president, according to White House press secretary Jen Psaki.
“The President expressed his gratitude for her effort and goodwill, but also indicated that the current offer did not meet his objectives to grow the economy, tackle the climate crisis and create new jobs,” Psaki said in a statement. “He indicated to Senator Capito that he would continue to engage a number of Senators in both parties in the hopes of achieving a more substantial package.”
Progressive lawmakers are urging Biden to move on from the talks with Republicans. They stepped up their calls for Biden to plow forward with a partisan bill after it was reported that the White House on Wednesday emphasized options other than raising the corporate income tax rate as ways to pay for a slimmed-down version of Biden’s initial $2.3 trillion proposal. Specifically, the White House focused on Biden’s proposal to create a minimum tax of 15 percent for large corporations’ income as it’s reported to investors. But Biden risks losing progressive support for a proposal that differs substantially from his initial proposal.
“Hmm. When the GOP passed legislation to provide a $1 trillion tax break to corporations & the 1% without a single Democratic vote, I didn’t hear my Republican colleagues say ‘Wait. It has to be bipartisan.’ Please don’t tell me we can’t use the same tools to help working people,” Sen. Bernie Sanders (I-Vt.) tweeted Friday. Rep. Jamaal Bowman (D-N.Y.) said in a statement Thursday that he’d have trouble voting for a smaller bill that didn’t undo the corporate tax cuts Republicans enacted in 2017. “$2 trillion was already the compromise,” he said. “President Biden can’t expect us to vote for an infrastructure deal dictated by the Republican Party.”
Other progressive groups have also raised concerns about the talks between the White House and Republicans. “We have no reason to believe that Republicans are coming to the table in good faith at all, so I don’t see any need to make concessions to Republicans at this point,” Maura Quint, executive director of the progressive group Tax March, told The Hill.
At the same time, Sen. Joe Manchin (D-W.Va.), a key moderate, said Thursday that he wants action on infrastructure to be bipartisan. “We need to do something in a bipartisan way,” Manchin said on CNN.
It’s unclear how much longer Biden’s talks with Republicans on infrastructure are going to continue; they’ve already gone past an informal deadline of Memorial Day. However, there are some challenges for Democrats in going it alone, as well.
Companies Are Offering Incentives to Vaccinated Consumers, But More Importantly: Why?
President Joe Biden says he wants to get 70 percent of America’s adults vaccinated by July 4. Booze and burgers may just do the trick. To juice America’s vaccination rate–just 52 percent of the adult population is now fully vaccinated–an increasing number of businesses have joined state and local governments in using incentives to encourage people to get vaccinated.
Brewer Anheuser-Busch announced on Wednesday it will partner with the White House to give a free beer to any adult who receives a vaccine before America’s birthday. On Thursday, the pharmacy division of Kroger, America’s largest supermarket chain, announced it would provide vaccinated customers the chance to win $1 million every week for five weeks, and award 10 shoppers “groceries for a year.”
Other popular campaigns include: One free doughnut a day from Krispy Kreme, free flights for a year on United Airlines, and a burger from Shake Shack, plus complimentary crinkle fries. If you prefer to catch or shoot your own food, the state of Maine is handing out free fishing licenses to vaccinated outdoor types, while West Virginia is giving away hunting rifles.
More conventionally, states such as Ohio and California will enter newly-vaccinated citizens into lotteries that pay out as much as $1.5 million. And the state of New York is tempting teens with a chance to win a full scholarship to any state university.
So what’s in it for businesses?
It’s maybe the right thing to do, but also it might speed the end of the pandemic. Reaching the administration’s goal would mean 160 million adults would be fully vaccinated. That is the level experts have said will keep the virus under control, allow restrictions to be lifted, ease pressure on healthcare workers, and get the country and economy fully reopen.
Businesses are also using vaccination incentives to stimulate sales and attract new customers. GG’s Barbacoa Café, a Kansas City smokehouse, rolled out a 25 percent vaccination discount last month. Owner Gabriel Gonzalez says the promotion will run through the end of June to any customer who shows their vaccine card. Gonzalez says the promo has prompted customers to add more items to their orders, which has offset the discount.
Like many restaurants, this family-owned business has focused on saving money over the last year, but Gonzalez says the increase in revenue and number of new customers from the vaccine campaign is now contributing to GG’s expansion. The café is moving to a bigger location in the coming months. More importantly Gonzalez says the vaccine promotion “is a great opportunity to help the community.”
And it’s ‘fun’ to win
Although business owners can require employees to be vaccinated, the government can’t. So, with the help of businesses, states are using behavioral economics to get hesitant or vaccine-resistant people to act in their own best interest. That’s what Richard H. Thaler and Cass R. Sunstein explored in their 2008 book Nudge. A year and a half ago Thaler, professor of behavioral science and economics at the University of Chicago Booth School of Business, proposed an experiment to offer lottery tickets to people who got a flu shot. (The flu killed an estimated 24,000 to 62,000 people during the 2019-2020 flu season, according to CDC.)
The pandemic has prompted states to run Thaler’s experiment in real time, the latest being Washington, where four residents could win $250,000, with one cashing a $1 million jackpot, an enticement that Thaler says “may well work.”
The pandemic prompted Thaler to revisit the decade old theories he and Sunstein first explored. In their revision, Nudge: The Final Edition, they raise the notion of fun as an incentive. Even in the midst of a lethal outbreak, offering amusement-incentives makes sense. “Lottery tickets are kind of fun, right?” says Thaler. “It’s the same with a free beer.”
Program Notices & Reminders – Expanded Information
|Small Business Tax Credit Programs
Did you know that the American Rescue Plan extends a number of critical tax benefits, particularly the Employee Retention Credit and Paid Leave Credit, to small businesses?
Small Disadvantaged Business Contracting Goal News
On June 1, 2021, the centennial of the Tulsa Race Massacre, the Biden-Harris Administration announced new steps to help narrow the racial wealth gap and reinvest in communities that have been left behind by failed policies. Specifically, the Administration is expanding access to two key wealth-creators – small business ownership and homeownership – in communities of color and disadvantaged communities.
Federal Contracting Webinar Series
Do you need help with federal contracting? The ChallengeHER webinar series offers education and training on the federal contracting system. Below is a list of upcoming webinars.
CDC Mask Guidance
The CDC still recommends that unvaccinated people continue to take preventive measures, such as wearing a mask and practicing social distancing. In their latest guidance, the CDC now reports that indoor and outdoor activities pose minimal risk to fully vaccinated people and that fully vaccinated people have a reduced risk of transmitting SARS-CoV-2 to unvaccinated people.
Fully vaccinated people can:
• Resume activities without wearing masks or physically distancing, except where required by federal, state, local, tribal, or territorial laws, rules and regulations, including local business and workplace guidance
• Resume domestic travel and refrain from testing before or after travel or self-quarantine after travel
• Refrain from testing before leaving the United States for international travel (unless required by the destination) and refrain from self-quarantine after arriving back in the United States
• Refrain from testing following a known exposure, if asymptomatic, with some exceptions for specific settings
• Refrain from quarantine following a known exposure if asymptomatic
• Refrain from routine screening testing if feasible
For now, fully vaccinated people should continue to:
• Get tested if experiencing COVID-19 symptoms
• Follow CDC and health department travel requirements and recommendations
Governor Pritzker Mask Changes:
Finally, join us in June for our re-scheduled luncheon with Police Chief Dawn Malec and Fire Chief Greg Blaskey on Wednesday, June 16 at Harrah’s Joliet Casino & Hotel. You may make reservations here: http://jolietchamber.chambermaster.com/events/details/2021-member-lunch-june-16-meet-greet-with-joliet-police-fire-chiefs-6060
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry