Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”
For those of you that routinely read this update, I’ve removed the constant reminder of the Back 2 Business grant from the state. Hopefully by now everyone that has been interested has applied. I am however interested in your feedback as to your expectation of the grant. Did you apply for the Business Interruption Grant last year and if so, were you awarded? Did you bother applying for the new B2B award considering some of the parameters set up for the order in which it would be distributed? Any other feedback is appreciated as we discuss how to communicate your needs moving forward. Are grant funds even your biggest need at this point or would you prefer some type of financial assistance for finding employees or filling other organizational needs?
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GOP Senators Block Democratic Bill to Fund Government and Suspend Debt Ceiling
Senate Republicans blocked a Democratic bill that would both fund the government and raise the country’s borrowing limit, escalating a political showdown over the government’s finances just days before it runs out of money.
Senate Democrats sought to pass a House-approved stopgap measure that funds the government through Dec. 3, 2021 and suspends the debt limit through Dec. 16, 2022. They are racing to send the legislation to President Biden’s desk before the government’s current funding expires at 12:01 a.m. Oct. 1, one of several big-ticket topics that lawmakers are juggling this week.
The failure of the procedural vote Monday could prompt Democrats to decouple the short-term spending measure and the debt-limit vote, to avoid the risk of a government shutdown at the end of the week. As part of that balancing act, House Speaker Nancy Pelosi (D., Calif.) said Monday evening the House would move ahead with a vote on the bipartisan infrastructure bill on Thursday and effectively decoupled it from Democrats’ separate healthcare, education and climate bill, the focus of continued debate within the party. The House may have to vote again on the government funding measure this week if the Senate approves it in a different form.
While lawmakers in both parties negotiated the short-term government funding, Republicans voted against Monday’s procedural motion in a bid to force Democrats to address the debt limit themselves. With 48 in favor and 50 opposed, the legislation fell short of the 60 votes required to advance in the evenly split chamber.
Senate Minority Leader Mitch McConnell (R., Ky.) said Monday that Republicans would support the funding measure independent of a debt-ceiling vote. Senate Republicans have almost unanimously lined up against voting to raise the debt ceiling, as a protest against Democrats’ agenda, including the $1.9 trillion coronavirus relief bill Democrats approved earlier this year and the broader $3.5 trillion education, childcare, healthcare and climate bill they are now working on.
GOP lawmakers say that Democrats, as the party in power, should take care of the debt limit themselves. Democrats say that votes to raise the debt limit during the Republican Trump administration were bipartisan.
“Social Security checks, Medicare benefits, veteran’s benefits, small business, all this and more are now on the chopping block because Senate Republicans are playing games with the full faith and credit of the United States,” Senate Majority Leader Chuck Schumer (D., N.Y.) said. Mr. Schumer, who changed his vote to a no to preserve his ability to bring the bill back to the floor, said the Senate would continue work on the issues this week.
President Joe Biden reportedly discussed the possibility of raising the debt ceiling via budget reconciliation on Monday evening on a telephone call with Speaker Nancy Pelosi and Senate Majority Leader [Charles] Schumer, the latest sign that Democrats are searching for a way around entrenched GOP opposition.
The impasse comes as Democrats also face a number of debates within their own party over the social policy and climate bill, including the amount of spending and the level of tax increases it should include. They are working to begin resolving those differences this week, hoping to open the door to House passage of a roughly $1 trillion bipartisan infrastructure bill. Progressives have said they would block that legislation until an ironclad agreement is secured on the social policy and climate bill.
Treasury Could Exhaust Cash Reserves by Oct. 18 if Debt Limit Isn’t Raised
Treasury Secretary Janet Yellen told Congress that the Treasury would be unable to pay all of the government’s bills if lawmakers don’t raise the federal borrowing limit by Oct. 18.
“At that point, we expect Treasury would be left with very limited resources that would be depleted quickly. It is uncertain whether we could continue to meet all the nation’s commitments after that date,” she said in a letter to congressional leaders on Tuesday morning.
Senate Majority Leader Chuck Schumer (D., N.Y.) said he would attempt later Tuesday to pass an increase to the debt limit with just a majority vote, allowing Democrats to raise it on their own if no Republicans object. But at least one Republican senator has already said that he would object, potentially blocking the Senate from using the tactic.
The letter from Ms. Yellen makes clear that lawmakers would only have 18 days after that to approve a debt-limit suspension before the Treasury could begin to miss payments on its obligations, triggering a default that could send markets into a tailspin.
The Treasury has been using emergency measures to conserve cash since Aug. 1, when the debt limit was reinstated after a two-year suspension. Ms. Yellen has warned lawmakers for months that the government could exhaust those measures this fall and said earlier this month that the date could come as early as October. Tuesday’s letter is the first time she has provided a specific estimate for the so-called X-date.
Ms. Yellen restated a plea for lawmakers to agree to raise the debt limit, which doesn’t approve new spending but instead allows the government to pay bills it has already agreed to incur, in her testimony Tuesday before the Senate Banking Committee, where she appeared alongside Fed Chairman Jerome Powell.
Ms. Yellen said the U.S. “would likely face a financial crisis and economic recession” if the Treasury can’t repay bondholders as debts mature. “It is imperative that Congress swiftly addresses the debt limit. If it does not, America would default for the first time in history,” she said.
Left warns Pelosi they’ll take down Biden infrastructure bill
Liberals on Tuesday sent a stern warning to Democratic leaders that a bipartisan infrastructure bill cannot pass through the House as long as Senate centrists remain non-committal on the larger social benefits package at the heart of President Biden’s agenda.
“If she were to call the bill, it will fail,” Rep. Jan Schakowsky (D-Ill.), a close ally of Speaker Nancy Pelosi (D-Calif.), said leaving a closed-door Democratic Caucus meeting. “Not because the Progressive Caucus, people like me, aren’t willing to vote for it. But … we had an agreement that we were going to get these two pieces [together].”
The warning is just the latest challenge facing Pelosi and other party leaders, who have scheduled a Thursday vote on the $1.2 trillion public works proposal, which passed through the Senate last month.
That timeline reflects Pelosi’s promise to moderate House Democrats, who have sought to divorce the bipartisan infrastructure bill from the larger and more controversial “family” benefits package.
Schakowsky noted that Pelosi, a master vote counter, has built a reputation for never bringing bills to the floor without knowing for certain they will pass — a stipulation the Speaker has repeatedly said also applies to the infrastructure bill. And for that reason, “it was not entirely clear” if leaders intend to push through with their plan to bring it to the floor on Thursday, Schakowsky said.
“I’ve never seen her bring a bill to the floor that’s going to fail,” she said. “It will fail if she does.”
The warning is the latest evidence that key progressives are sticking with their long-held insistence that centrist Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.) first commit to supporting the larger social spending package before the liberals vote in favor of the more popular public works bill. And they have the numbers, they say, to sink it.
In a brief interview with The Hill, Pelosi downplayed the threat from Schakowsky and other progressives: “We don’t even know where we are until we see where we come down on our agreement, so there’s no use speculating on what may or may not happen … “I appreciate Jan Schakowsky,” the Speaker added.
Rep. Rashida Tlaib (D-Mich.), a member of the so-called “Squad” of progressive lawmakers of color, was harsher. She called Pelosi’s decision to reverse course and decouple the two bills a “betrayal.”
“Let me be clear: bringing the so-called bipartisan infrastructure plan to a vote without the #BuildBackBetter Act at the same time is a betrayal. We will hold the line and vote it down,” Tlaib vowed on Twitter. “This is not the time for half measures or to go back on our promises.”
Rep. Jim McGovern (D-Mass.), chairman of the powerful Rules Committee, is also seeking greater certainty surrounding the intentions of the Senate centrists.
“Look, I want to be a good guy. My father told me when I was growing up there’s a fine line between being a good guy and a goddamn fool. I don’t want to be rolled,” he said. “And I think a lot of us want to make sure that we have an assurance that, in fact, there’s going to be a reconciliation bill.” But amid the grumbling on the left, a number of other progressives declared Tuesday that they would vote yes on the infrastructure bill when it hits the floor — without any conditions.
Company CEO’s Speak Out on Proposed Tax Increases
The Business Roundtable, a large and powerful group consisting of prominent corporate leaders, said Tuesday that Democrats proposed corporate tax hike is one of the greatest threats to companies’ investment, hiring and growth plans in the foreseeable future.
The organization said its third-quarter CEO survey showed that chief executives have three primary concerns: difficulty finding and retaining qualified workers, a possible rise in the corporate tax rate, and slow Covid-19 vaccine uptake.
“Increasing taxes on America’s largest job creators by almost $1 trillion—nearly three times the net corporate tax cut from 2017 tax reform—would be one of the largest corporate tax increases in history,” said Business Roundtable President and CEO Joshua Bolten. “Tax increases on job creators would make it harder for U.S. companies to compete and would hinder investment in America.”
The Biden administration and congressional Democrats are working to pass a $3.5 trillion bill to modernize and expand the U.S. public safety net that would impact most Americans. The legislation broadly seeks to tackle poverty, address critical climate risks and provide expanded worker benefits. The final price tag will likely be lower as centrist Democrats push for cuts.
To help pay for what would be one of the largest bills in the nation’s history, Democrats have proposed raising the corporate tax rate to 26.5%. Former President Donald Trump’s 2017 tax legislation lowered the rate to 21% from 35%. The party has also proposed a top individual income tax rate of 39.6%, a 3% surcharge on individual income above $5 million and a capital gains tax of 25%.
The Business Roundtable conducts a survey each quarter of some of the nation’s CEOs to stay apprised of the hurdles and tail winds businesses are facing. The group conducted the current poll between Sept. 2 and Sept. 21 with 160 responses.
The Roundtable survey also showed CEOs remain upbeat on the overall U.S. economy, but indicated they are now slightly less optimistic than they were in the second quarter given a decline in expectations for sales. The organization’s survey suggested CEOs are trying harder to bolster payrolls and continue to warm to big-ticket capital projects like new factories, equipment and the like.
Walmart CEO Doug McMillon’s comments suggested there is widespread support among corporate leaders for the $1 trillion bipartisan physical infrastructure plan before Congress. “Investment in our nation’s infrastructure is urgently needed,” McMillon, who is also the Roundtable’s chairman, said in prepared remarks.
“We applaud Congress for scheduling a vote on the bipartisan Infrastructure Investment and Jobs Act this coming Thursday,” he added. “We urge every member of the House of Representatives to vote yes on this once-in-a-generation opportunity to generate significant investment in America’s transportation, water, energy and communications systems.”
Biden administration proposes rule reinstating DACA
The Biden administration has moved to make permanent protections for those brought to the U.S. undocumented as children, an effort to combat legal challenges to a program first started under President Obama.
How it would work: A proposed rule from the Department of Homeland Security would solidify the Deferred Action for Childhood Arrivals (DACA) program that was suspended under President Trump and enjoined by a Texas court in July of this year, leaving an estimated million people in immigration limbo.
What happens now: The new rule, to be published in The Federal Register, would go into effect after the administration considers public input during a 60-day comment period.
Pritzker signs revised legislative districts into law as court challenges continue
Gov. J.B. Pritzker signed into law Friday a revised map of General Assembly boundaries designed to ensure Democrats keep control of the Illinois House and Senate through the decade, starting with next year’s elections. “These legislative maps align with the landmark Voting Rights Act and will help ensure Illinois’ diversity is reflected in the halls of government,” Pritzker said in a statement.
Republicans and several voting rights groups had asked the Democratic governor to veto the latest map plan, contending the vote by Democrats to approve it in an Aug. 31 special session came too quickly to adequately assess its effects on the state’s political, racial and ethnic makeup.
Republicans also said that by signing the revised measure, which was based on delayed federal census data that didn’t come out until mid-August, Pritzker reneged on his initial campaign vow not to approve partisan-drawn maps.
Springfield Democrats still aren’t saying much about how they’re soon planning to redraw Illinois’ congressional districts. But they want you to know they want you to be part of the process.
In a joint statement today, the chairs of the House and Senate redistricting committees, Rep. Elizabeth Hernandez, D-Cicero, and Sen. Omar Aqino, D-Chicago, invited the public to research the numbers and submit their own ideas by accessing the mapmaking portals: www.ilsenateredistricting.com and www.ilhousedems.com/redistricting
“This mapmaking tool gives everyone the opportunity to share their thoughts and help us create districts that reflect our state,” Hernandez said in the statement.
Sources say the legislative leaders intend to pass new maps in the General Assembly’s veto session in mid-October. All indications are that the Dems will try to force Republicans to eat the state’s loss of one congressional seat as a result of remap (probably the one now held by Rep. Adam Kinzinger, R-Channahon), and potentially flip to the Democrats a downstate seat held by Rep. Rodney Davis, R-Taylorville.
Legislation aims to lure private investment to infrastructure projects
Illinois lawmakers are making an attempt to get private investment dollars into the state’s infrastructure projects. The Senate Transportation Committee, along with the Executive Subcommittee on Procurement, held a hearing Monday on Senate Bill 1900, which would create a Public-Private Partnership (PPP) and Infrastructure Investment commission that would assist public entities with projects where a public-private partnership could take place.
In a PPP, the private party can finance, build, operate and maintain public infrastructure facilities and provide services usually delivered by government agencies within the community. Mary Tyler, transportation director with the Illinois Economic Policy Institute, said funding projects from Illinois’ motor fuel tax will become outdated.
“The value of the motor fuel tax will continue to diminish in the future, largely a result of increased vehicle fuel efficiency and the increasing popularity of electric vehicles,” Tyler said. “Consequently, Illinois must continue to pursue innovative funding options to support necessary maintenance of the state’s infrastructure.”
Proponents of public-private partnerships say the arrangement can make a seemingly impossible project a possibility and enables completion of a project within a faster timeline by offering incentives. Opponents say the infrastructure or service delivered by a private entity can be more expensive, and transparency is also a concern.
In the latest report card on infrastructure from the American Society of Civil Engineers, Illinois received a grade of C-minus. The state received a D for its roads and transit, and a D-minus for navigable waterways.
“As chair of the Senate Transportation Committee, I am committed to exploring new ways to make our transportation network safe and accessible with the absolute stewardship of taxpayer dollars as a top priority,” said Sen. Ram Villivalam, D-Chicago.
Governor Pritzker Announces Local Appointment to Enterprise Zone Board
Doug Pryor will serve as a Member on the Enterprise Zone Board. Doug currently serves as the Vice President of Economic Development for the Will County Center for Economic Development where he has successfully delivered more than $4 billion of investment in development projects from diverse sectors including energy, manufacturing, health care and retail. Previously, he served as the County Administrator for Grundy County for two years, and prior to that, he served the Grundy Economic Development Council first as an Economic Research Analyst and then as Vice President. Since 2012, Pryor has taught courses in economics and statistics at Dominican University. Pryor received his Master of Business Administration from Dominican University and his Bachelor of Arts from the University of Illinois-Springfield.
Congratulations to Doug, a good partner of the Chamber over at the CED!
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry