Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”

Chamber members:

Tensions in the House GOP over how to avoid — or not avoid — a potential government shutdown is coming to a boil, with frustrations spilling over into public jabs and airing of grievances without a clear path forward to fund the government past Sept. 30. It should be an interesting 10 days. We hope that if it comes to a shutdown, that all sides act quickly to make it as short as possible.

Monday was the day for the end to the traditional cash bail system in Illinois. After a court delay, all 102 counties implemented the change.

*Government Affairs Roundup brought to you by CITGO & Silver Cross Hospital*

House Speaker Kevin McCarthy’s Plan to Avoid Government Shutdown
The House speaker’s plan for keeping the government open past Oct. 1 involves bringing a package of national-security oriented spending bills to the floor, while aiming to pass a short-term spending bill to buy time to hammer out an agreement on funding the rest of the government for fiscal 2024. A group of conservatives derailed a planned procedural vote on the centerpiece of that package, an $826.45 billion annual defense-spending bill.  The plan would extend funding for a month and pair spending cuts with border crackdown measures.

After working through the weekend to bridge differences between their centrist and conservative wings, House Republican leaders announced that they had a deal that could unite the GOP behind a short-term spending patch and shore up their negotiating position with Democrats ahead of a potential Oct. 1 shutdown.

For a minute, it seemed like a deja vu moment — another tactical coup for Speaker Kevin McCarthy, who after fits and starts earlier this year got his conference to unite behind a conservative debt-ceiling proposal, paving the way for an unlikely bipartisan deal to avert a federal default. This time, things aren’t looking so good.

As details of the deal hashed out by leaders of the Main Street Caucus and House Freedom Caucus trickled out, a bevy of conservative hardliners piped up with various versions of “Hell No” — rejecting a measure that would impose an 8% cut to most non-defense programs and implement an array of GOP border policies while extending government funding for a month.

With a vote expected no sooner than Thursday, McCarthy and Majority Whip Tom Emmer (R-Minn.) have some time to tweak the proposal and bring the holdouts around. Perhaps the argument that worked during the debt-limit fight could change some minds again: The point isn’t to get this proposal signed into law, but to give Republicans as strong a negotiating hand as possible. But, remember, this is a group that felt burned by the deal McCarthy ultimately negotiated to end the default crisis, and they’re not going to be inclined to allow him much room to maneuver again.

And whatever the fate of this CR gambit, remember that neither outcome brings Congress any closer to avoiding a shutdown in 13 days. Biden and the Democratic Senate aren’t going to swallow a top-line spending cut and a bunch of partisan policy riders to keep the lights on. And remember they have a wish list of their own, including a hefty new tranche of Ukraine.

Update: House GOP leadership pulled a procedural vote on a proposed short-term funding stopgap that has bitterly divided the Republican conference and elicited opposition from hardline conservatives.

The House was scheduled to vote at 2:30 p.m. Tuesday on the rule to allow the GOP continuing resolution (CR) proposal to move forward, but an update sent out shortly before noon did not list the procedural vote.

Taxpayers unlikely to get all money back from pandemic-era fraud
With cases of the taxpayer-funded pandemic-era Paycheck Protection Program fraud mounting, there’s little expectation taxpayers will get made whole. The federal government approved trillions of dollars during the COVID-19 pandemic in aid for the public and private sectors after governors in most of the country, including Illinois, sustained emergency orders limiting economic activity. While such disaster proclamations have since sunset, the fraud continues to surface.

In one instance, the Illinois Office of Executive Inspector General referred 177 state employees to law enforcement for providing false information on PPP applications for a total of around $4.5 million in alleged fraud. Other stories include employees of Chicago and Cook County government involved in fraud.

Last week, a federal grand jury indicted 19 central Illinois United States Postal Service workers for wire fraud. “Each of the individuals have either already been arraigned or have been issued a summons to appear in federal court in Springfield or Urbana for arraignment,” said the office of the U.S. Attorney’s Office for the Central District of Illinois. If convicted, the current and former USPS employees could get a maximum of 30 years in prison. The ages of the postal workers charged range from 25 to 47.

Now in private practice, former federal prosecutor Christine Adams notes the young age in other cases. “They don’t quite have the judgment they ought to have and are still developing it, submitting false loan applications because their peers are also doing it,” Adams commented.

Whether taxpayers can expect getting the money back depends. “When they received the money, they just spent it … cars, trips, luxury items, people like that you’re not going to be able to recover any funds from because they spent all the funds,” Adams said. “But if there’s individuals who still have some monies or some access to monies, and the government goes after them, the government can recover some of the money.”

The U.S. Government Accountability Office last week estimated unemployment fraud during the pandemic cost taxpayers up to $135 billion or about 11% to 15% of the total amount of unemployment insurance benefits paid during the pandemic. Adams said the government should learn from the issues that have cropped up within some taxpayer-funded pandemic programs.

“People needed relief quickly,” Adams said of the pandemic-era economic contractions. “Businesses needed relief quickly. Employees that wanted to keep their jobs needed relief quickly. But the question really is did it have to be this quick.”  Adams notes a government watchdog found grant administrators did not use do-not-pay Treasury Department lists that could have provided more oversight on outgoing tax dollars.

Subminimum Wage on Way to Abolishment in Chicago for Tipped Workers … Is the State Next?
Chicago is poised to become the largest American city to autonomously eliminate a subminimum wage for tipped workers, following an agreement forged on Monday between Mayor Brandon Johnson’s allies in the City Council and representatives from the restaurant industry. This development comes in the wake of the Illinois Restaurant Association proposing a less comprehensive measure that was deemed inadequate by Mayor Johnson’s council supporters.

The forthcoming substitute ordinance, scheduled for introduction in a City Council committee this week, would require Chicago businesses to provide tipped workers with the same minimum wage as all other employees within the city over the next five years. This initiative, as stated by its sponsors, is slated for a preliminary vote on Wednesday in the council’s Workforce Development Committee, with a full council vote anticipated later in the fall.

If the ordinance is successfully passed, Chicago would emerge as the largest city in the United States to independently phase out a tipped wage, and the second-largest city, after Los Angeles, to mandate a unified wage structure for both tipped and non-tipped workers. It’s worth noting that Los Angeles already eliminates the subminimum wage for tipped workers, but this is enforced under California state regulations, which mandate that employers pay these workers the full minimum wage. Apart from California, Alaska, Minnesota, Montana, Nevada, Oregon, and Washington have also abolished the tipped wage, according to data from the U.S. Department of Labor.

At present, Chicago’s minimum wage for tipped workers stands at 60% of the city’s $15.80 per hour minimum wage, equating to $9.48 per hour. In cases where tipped workers do not earn sufficient gratuities to reach the $15.80 minimum wage, larger employers are obligated to make up the entire difference, while smaller employers must ensure that tipped workers earn at least $15 per hour.

The city’s minimum wage is scheduled to rise annually in line with either the consumer price index increases or by 2.5%, whichever is lower. As for the state of Illinois, its minimum wage is currently $13 per hour.

The extended five-year phase-out of Chicago’s subminimum wage, compared to the initial two-year proposal, means that beginning next July, tipped workers will receive incremental raises each year, reducing the 40% wage gap by 8% annually until parity is reached by July 1, 2028.

Sam Toia, the President of the Illinois Restaurant Association, disclosed that he withdrew his opposition to the original bill sponsored by Ald. Jessie Fuentes, 26th, alongside co-sponsors Alds. Ramirez-Rosa, Rossana Rodriguez-Sanchez, 33rd, and Julia Ramirez, 12th, because he regarded the Monday agreement as the most viable option. Toia explained, “Obviously, I know how to count votes, right? The mayor had the votes, even with a two- or three-year phase-in. He is an organizer. He understands this… A five-year plan is usually what a bank asks you when you go in for a loan. That’s why I always thought five years would be good.”

Toia’s group presented a counterproposal late on Friday, which would have increased the tipped wage to $20.54, but solely for restaurants with annual revenue exceeding $3 million. This proposal failed to gain traction.

This differs from the situation in 2019 when Illinois Democrats, with the backing of the restaurant lobby, passed legislation during Governor J.B. Pritzker’s early weeks in office that would raise the state minimum wage to $15 per hour by 2025. Restaurant owners were amenable to this because it preserved the ability to pay tipped workers a lower wage.

Saru Jayaraman, President of the national One Fair Wage movement advocating for the abolition of the tipped wage, hailed the impending agreement as a “victory for restaurant workers, advocates, and the owners who will see more people return to the industry.” She further emphasized the significance of this development, stating, “Today’s announcement marks a seismic shift in the movement to end the subminimum wage for tipped workers nationwide… This breakthrough is an example of what is possible when workers, advocates, and elected leaders with the political courage stand together.”

Update: The proposal to gradually eliminate the city’s so-called sub-minimum wage for tipped workers received initial approval on Wednesday after a compromise was reached with the Illinois Restaurant Association.

The Committee on Workforce Development approved the measure in a 9-3 vote, setting up a final City Council vote on Oct. 4 that, if approved, would eliminate the tipped wage entirely by 2028.

Why Small to Midsize Businesses Should Prioritize Accessibility
Digital accessibility has become an essential topic among businesses in recent years. Not only does accessibility benefit customers, but it can also help businesses. Companies are paying more attention to making their goods available to consumers of all ability levels to ensure these mutual benefits.  They may do so by adapting their online platforms and by making public commitments to accessibility.

While larger and higher-profile companies have been the face of this trend, it’s just as important for small to mid-size companies to do the same. What is digital accessibility?  Digital accessibility means ensuring individuals of all ability levels can use digital products (websites, apps, smart devices, etc.). This includes making products accessible to persons with disabilities.

According to the Centers for Disease Control (CDC), around 26% of American adults have some form of disability. Everyone comprising this demographic deserves an uninhibited opportunity to receive goods and services. A business can help facilitate that right by creating products that don’t inadvertently discriminate against individuals based on their abilities.

Companies can help facilitate accessibility by adhering to standards such as the Web Content Accessibility Guidelines (WCAG) and making necessary product adjustments. Such adjustments include proper color contrast, alt-text on images, and compatibility with assistive devices.

Ensuring digital accessibility is important for all businesses. This includes small, local, mid-sized, or start-up businesses. Not only are these kinds of companies in a better position to make necessary changes, but it is also the smartest thing for them to do. For one thing, these companies will see tremendous growth in profits and customers by embracing accessibility. Furthermore, they are less at risk of facing ADA-related lawsuits by embracing accessibility.

Event: Creating a Sustainable Digital Accessibility Business Plan
Tuesday, October 24th at NOON for an event on Creating a Sustainable Digital Accessibility Business Plan.

Stay well,

Mike Paone
Executive Vice President
Joliet Region Chamber of Commerce & Industry
815.727.5371 main
815.727.5373 direct