Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”
Chamber members:
Congresswoman Lauren Underwood will be hosting a series of town halls in all seven counties across the 14th District in August. The town halls will be an opportunity to hear an update on the Congresswoman’s work in Congress for our community, share concerns, and ask questions.
The Will County Town Hall on Wednesday, August 9th will be bilingual and include Spanish interpretation. If you would like to attend, please RSVP to expedite your check-in process when you arrive. RSVP HERE: https://tinyurl.com/augtownhalls2023
Will County Town Hall (with Spanish Bilingual Interpretation)
Wednesday, August 9 at 5:30 p.m.
RSVP: https://tinyurl.com/augtownhalls2023
Kendall County Town Hall
Monday, August 14 at 6:00 p.m.
RSVP for more information: https://tinyurl.com/augtownhalls2023
*Government Affairs Roundup brought to you by CITGO & Silver Cross Hospital*
Pritzker Administration Invests in Early Childhood with Early Intervention Incentive Payments
The Pritzker administration is taking another step to advance the Smart Start Illinois program, a multi-year plan to provide every child with access to preschool, increase funding to child care providers to raise wages and quality, invest in new and expanded early childhood facilities, and reach more vulnerable families with early support. Building on previous announcements and strategies in the Smart Start initiative, today the administration announced a proactive approach to ensure the well-being of its youngest residents with the launch of Early Intervention Incentive Payments, continuing to position Illinois as the best state to raise young children.
These payments recognize the value of early intervention service providers in Illinois who deliver therapies to infants and toddlers in support of their healthy growth and development. The initiative, administered through the Illinois Department of Human Services (IDHS), will provide one-time bonus payments to Early Intervention service providers and service coordinators of up to $1,300 between August and October of 2023.
“Since day one as Governor, it has been my mission to make Illinois the best state to have kids and raise a family,” said Governor JB Pritzker. “That means investing in the services that reach our littlest Illinoisans—from home visiting and early intervention to child care and preschools. Thanks to my administration’s Smart Start Illinois Plan, coupled with federal dollars from the American Rescue Plan Act, we are proud to launch Early Intervention Incentive Payments—giving our service providers the support and resources they deserve for caring for our state’s children.”
Early Intervention Incentive Payments are designed to recognize and reward early intervention service providers for their commitment to the development and well-being of children. It offers a financial incentive to qualified providers who have dedicated themselves to providing quality services. Early Intervention Providers, Associate Providers, Service Coordinators, and Interpreters who are credentialed, enrolled, and are carrying a caseload as of June 30, 2023, will have eligibility determined by their credentialed enrollment and billing status. There is no need to apply.
Early Intervention Incentive Payments are funded through American Rescue Plan Act (ARPA) dollars and are intended to recognize the difficulties providers faced during the COVID-19 pandemic and encourage staff retention. In addition, these payments complement new investments that are part of Illinois’ Smart Start program, which increased funding by $40 million for the Early Intervention program and its workforce. Through Smart Start, Early Intervention will be able to increase reimbursement rates by 10% for staff and allow the program to serve more children and to better meet families’ needs.
“The Illinois Early Intervention Incentive Payments are more than just an incentive; they are a testament to our commitment to nurturing the potential of every child. By investing in the Early Intervention workforce, we lay the foundation for a brighter future, ensuring that no child’s development is left behind. It rewards not only the providers but also helps every child receive the support and services they need to develop to their fullest potential,” said Grace B. Hou, Secretary, Illinois Department of Human Services.
“Youth and children have limitless potential. Our commitment to supporting and improving the lives of working families in Illinois is stronger than ever and this program will create a network of excellence in EC education,” said Deputy Majority Leader Natalie Manley (D-Joliet). “By incentivizing early intervention service providers and continuums, we will promote quality services that have a lasting impact on the children’s physical, cognitive, and social-emotional development for years to come.”
The Early Intervention Incentive Payments align with the state’s commitment to providing equitable access to high-quality early childhood education and care. Since 2019, Governor Pritzker has expanded access to high-quality early childhood programming for children across the state.
Early Intervention Providers can find out more by going to the Provider Connections website.
Illinois legislators are discussing a measure that aims to provide an additional $500 million a year for the state’s pension systems to address unfunded liabilities.
The state manages five pension funds. The Teachers’ Retirement System covers retired teachers from across the state with the exception of Chicago. Combined with TRS, the State Universities Retirement System, the state Employees’ Retirement System, the Judges’ Retirement System and the General Assembly Retirement System have an unfunded liability of at least $140 billion. They are funded about 42% of what their overall obligations are. The pension system for lawmakers is the worst funded at about 19%.
House Bill 4098 would allow the Illinois treasurer and comptroller to transfer $500 million from the General Revenue Fund to the Pension Unfunded Liability Reduction Fund each fiscal year. The funds would be used for making additional contributions to the pension funds for retired state employees. The current budget already spends around $10 billion this year on pensions. That accounts for around one out of every five dollars the state takes in taxes.
The Teachers’ Retirement System currently has a total unfunded pension liability of around $80 billion among two different tiers of employees. Tier 1 is for those in TRS before 2011. Tier 2, with fewer benefits, is for those hired after 2011. Andrew Bodewes of TRS told the committee if things stay the same, it will be 2085 before TRS has no one left in Tier 1.
The State Employees’ Retirement System is 44% funded. The most recent audit for the fiscal year that ended June 30, 2021, shows SERS with around $30 billion unfunded liability, a funding ratio of 42%.
State Rep. Steven Reick said that this is the first time since he’s been in office that a plan for addressing pensions has been formed. “We’re starting, and that is something that hasn’t been done since I’ve been in the General Assembly,” Reick said. “We’ve actually taken the bull by the horns and have started to actually make plans for how we are going to fix this thing.”
One issue legislators are evaluating is modifying the benefits for Tier 2 retirees. TRS officials stated that the Tier 2 benefit would not meet the Social Security safe harbor benefit requirement, which could lead school districts to make up the difference. That could put more pressure on Illinois’ already high property taxes.
During a committee hearing, state Rep. Carol Ammons, D-Urbana, said if they don’t address Tier 2 pensions, those employees could “take recourse” against the state, which would result in “costing the state more in the long run.”
State Rep. Stephanie Kifowit, D-Oswego, said that the Tier 2 issues are being addressed through HB4098. “This is the first time ever that we have had a bill that discusses Tier 2 to this depth,” Kifowit said. “There’s been side conversations, but this is truly momentum going in the right direction.”
Legislators plan to work on the measure throughout the summer and attempt to get the bill read and passed during the next legislative session.
Illinois unemployment agency made $5.2 billion in ‘overpayments’ during COVID-19
Illinois lawmakers are calling for accountability into the state’s handling of unemployment payments during the COVID-19 pandemic after an audit showed $5.2 billion was overpaid, including tens of millions to some who were incarcerated or deceased.
Unemployment spiked at the beginning of the COVID-19 pandemic in the spring of 2020 after Gov. J.B. Pritzker issued stay-at-home orders impacting the economy in an effort to slow the spread of the virus.
The Illinois Auditor General report published shows billions of unemployment tax dollars were improperly paid out by the Illinois Department of Employment Security during that time. The audit looks at IDES from fiscal year 2020 to fiscal year 2022.
“Beginning in March 2020, IDES suspended some routine identity crossmatches performed on all regular UI claims filed because the crossmatches required time to run and constricted the processing system severely,” one audit finding said. “These crossmatches were temporarily suspended and/or processed offline. This allowed IDES to better handle the increase in claims processing traffic; however, this left the unemployment programs more susceptible to fraud.”
Previous reports from the auditor found at least $2 billion in fraudulent payments, but noted poor record keeping at the agency prevented inspectors from getting the full picture. The report shows the state made $5.2 billion in overpayments and made $46 million worth of payments to some who were incarcerated or deceased.
A statement from IDES puts some of the blame on the Trump administration and their implementation of a “poorly designed and brand-new unemployment insurance program” for the state to manage. “Because the federal program did not require the routine and necessary crossmatching identity controls incorporated within the state’s regular unemployment insurance system, the likelihood that overpayments and fraud recovery efforts would be negatively impacted is unsurprising,” the statement reads.
The auditor said IDES delayed implementing fraud prevention tools the U.S. Department of Labor suggested. “IDES chose to not utilize the Integrity Data Hub tools because other IT-related projects were deemed to be of greater urgency during the pandemic,” the auditor said. “IDES began utilizing the Integrity Data Hub tools in September 2021.”
Additionally, IDES entered into eight contracts during the audit period for services and software related to administering unemployment insurance totaling $226.4 million, according to the audit.
State Sen. Chapin Rose, R-Mahomet, said thousands of Illinoisans could not pay their bills on time or keep their businesses open due to the agency’s handling of the funds. “How do you think somebody who filled out all the forms, and did all the paperwork and never got one red cent from the state of Illinois when they needed it most, how do you think they will feel when they pick up the paper and find out that Pritzker lost billions of dollars,” Rose commented.
The $46 million that was paid out to those incarcerated or dead could also be understated due to reporting issues by the agency. State Rep. La Shawn Ford, D-Chicago, said that the state’s entire system needs to be addressed. “This news explains why so many eligible people struggled to receive their benefits to take care of themselves and their families,” Ford said. “This audit shows that people took advantage of Illinois’ outdated system and caused havoc and despair for so many people by taking taxpayers’ money that they didn’t earn.”
The agency said they would “apply the audit recommendations, particularly those related to enhancing internal controls and oversight to existing processes and programs,” to create a “foundation of best practices” for future programs.
Total taxpayer spending for Illinois’ budget jumps 95% since 2018
A new report from the Illinois Commission on Government Forecasting Accountability shows a dramatic increase of overall taxpayer spending over the past six years. COGFA’s report on fiscal year 2024 released Monday reviews the annual budget that began July 1. The report details the budget process and how much each state agency and program is set to receive in annual appropriations.
While a lot of reporting focuses on the state spending of $50.4 billion in Illinois General Revenue Funds, overall taxpayer spending is much higher at more than $193.5 billion when taking into account federal and special funds. That’s up from the $99 billion in total spending for fiscal year 2018, or a 95.3% increase.
Truth in Accouting’s Sheila Weinberg said there was a 7% increase from 2018 to 2019. “Then COVID happened and then the floodgates just opened. The federal government threw money at everything. The states threw money at everything,” Weinberg said. “So between 2019 and 2020, the annual appropriations increased by a whopping 35%.”
From 2020 to 2021, spending increased 19%. The following year, spending went up 8% and from 2023 to 2024, spending increased around 3%. Weinberg said with the COVID-emergency over, one would think the elevated spending would decrease, but that does not appear to be the case.
The reported annual budget of $50.4 billion in state funds isn’t transparent, she said. “So this, quote, budget that they’re talking about that they, quote, balanced is only 26% of the overall appropriations,” Weinberg said.
Most of the state spending is from little-known special funds. “What are special funds? How are they defined? It’s whatever the legislature decides are special funds,” Weinberg said. “We did a study a few years ago with the Union League Club and found there’s more than 600 special funds.” Weinberg said it’s important taxpayers know about all of the state’s appropriations so they can hold policymakers accountable for increased spending.
Governor Pritzker has signed more than 150 measures into law in recent days
Here are some of the laws that Pritzker signed. ***Note: All laws will take effect Jan. 1, 2024, unless otherwise noted.
HB 2068 – All employers with 50 or more employees, and that are located within one mile of regularly-scheduled transit service, will be required to allow eligible employees to exclude public transit costs from their taxable wages.
HB 2094 – All marketing materials from mortgage companies not connected to a homeowner’s mortgage company must comply with specified requirements so as not to mislead consumers.
HB 2269 – All estate-planning documents must be able to be prepared electronically. Previously, only wills were included in that category.
HB 2431 – Videoconferencing while driving will now be banned in Illinois.
HB 2493 – All employees in Illinois will now have unpaid leave of up to two weeks in the event a family or household member is killed in a crime of violence.
HB 2531 – The Illinois Department of Transportation will be required to begin the prequalification process for public-private agreements related to a south-suburban airport, which will be located near Peotone.
HB 2719 – Hospitals will be legally required to screen patients for eligibility for financial assistance before sending them to collections.
HB 3957 – Manufacturers and wholesale drug distributors will be required to abstain from price gouging in the sale of essential off-patent and generic drugs.
SB 1463 – Fees and fines can no longer be assessed in Illinois to individuals under the age of 18, except for traffic tickets, boating or fishing violations, or municipal ordinance violations.
SB 1896 – New and used licensed motor vehicle dealers will be allowed to conduct sales activities via the internet and will be permitted to deliver vehicles to a customer’s residence or another suitable location.
Stay well,
Mike Paone
Executive Vice President
Joliet Region Chamber of Commerce & Industry
mpaone@jolietchamber.com
815.727.5371 main
815.727.5373 direct