Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”
Chamber members:
Last week I shared the link for the Federal Reserve Bank of Chicago’s 2026 Small Business Credit Survey and received a good amount of feedback on the offer. Survey closes November 13, 2026. Click below to take the 12-minute survey now:
https://fedreserveboard.gov1.qualtrics.com/jfe/form/SV_38k9xZy8ayEERue?orgID=20261024
Today, I’m going to share the second part of an ongoing opportunity with the Fed. See below for more information about registration to receive the monthly invite to participate in the Survey of Economic Conditions. This is something that you have to sign up for, rather than the chamber providing a monthly link.
Finally, more news about a positive financial picture for the state. Last month I reported that the new fiscal year started off well and now a report that the end of the previous fiscal year ended on a high note.
*Government Affairs Roundup brought to you by CITGO*
Chicago Fed Survey of Economic Conditions
We’re looking for businesses to share their feedback. If you currently fit the definition below, please register to receive the link for the monthly survey.
Do you…
- work for an organization that operates in Illinois, Indiana, Iowa, Michigan, or Wisconsin?
- track your organization’s performance measures?
- want to help the Federal Reserve understand current economic conditions?
If you do, we invite you to participate in the Chicago Fed Survey of Economic Conditions.
- The survey is conducted twelve times per year and takes about ten minutes.
- Results are shared with the Chicago Fed’s president and help inform monetary policy.
- Individual responses are kept confidential, but aggregate results are made public, so you can learn how you compare with your peers.
To join the survey, submit your contact information here: https://frbchicagodistrict.gov1.qualtrics.com/jfe/form/SV_6EDcFIIXm3kR6R0
For more information and results of the August survey you can visit, https://www.chicagofed.org/research/data/cfsec/current-data
Illinois Closes FY26 with Revenue Surplus
Illinois closed out Fiscal Year 2026 with stronger-than-expected revenues, though questions remain about the sustainability of that growth and the state’s long-term fiscal position.
According to the Commission on Government Forecasting and Accountability, general revenue from taxes and fees exceeded projections by $1.003 billion, or 1.8%. Gains in personal income tax, estate tax, and transfers into the general fund helped offset weaker-than-expected federal funding and corporate tax receipts.
Momentum carried into the start of Fiscal Year 2027. The Commission’s June report showed revenues rising 8.2% compared to June 2025, signaling continued strength in key categories such as income and sales taxes. However, the report cautions that this pace of growth is unlikely to persist throughout the year.
At the same time, broader economic indicators present a more mixed picture. Illinois’ unemployment rate has increased to an average of 5.1%, up 0.7 percentage points year-over-year, and continues to trail national performance.
State leadership has pointed to recent fiscal progress. Governor J.B. Pritzker highlighted multiple credit rating upgrades issued late last month and on September 1 by Moody’s Investors Service, S&P Global Ratings, and Fitch Ratings. These mark the 11th, 12th, and 13th consecutive upgrades under the current administration, reflecting improved confidence in the state’s ability to meet its debt obligations.
The administration also emphasized legislative efforts aimed at strengthening Illinois’ long-term finances, including directing excess income tax revenues toward reducing unfunded pension liabilities.
Still, some policymakers urge caution. Commission Co-Chair Rep. C.D. Davidsmeyer noted that while revenue growth is a positive sign, it is driven in part by ongoing tax and fee increases rather than purely organic economic expansion. “It’s good to see natural growth,” Davidsmeyer said, “but the state continues to rely on annual tax increases to meet budget demands.”
For the business community, the state’s current fiscal position reflects both opportunity and uncertainty, strong near-term revenues and improved credit ratings, balanced against longer-term concerns about competitiveness, economic growth, and structural budget pressures.
Illinois Advances Energy Storage and Solar Goals
Illinois is making measurable progress toward its clean energy goals, but early results show the transition will take time, coordination, and continued market development.
A key piece of that transition is energy storage. As more solar and wind power comes online, battery storage is needed to ensure reliability, capturing energy when it’s produced and delivering it when demand is highest.
Last month marked an important first step. State regulators, through the Illinois Power Agency (IPA), completed the first major procurement of utility-scale battery storage under new energy legislation enacted earlier this year.
The result: approximately 600 megawatts of new storage capacity expected by 2030, enough to power roughly half a million homes. That represents a significant increase from the 141 megawatts currently installed in Illinois and signals growing momentum in the state’s energy transition.
At the same time, the outcome fell short of the state’s initial target of more than 1,000 megawatts. While that gap has raised questions, many stakeholders view the first round as a foundational step rather than a final benchmark.
Part of the story lies in regional differences. The procurement process exceeded expectations in central and southern Illinois (MISO territory), securing 520 megawatts across several projects. Northern Illinois (PJM/ComEd territory), however, came in well below target, with just 80 megawatts secured.
Industry experts point to timing and structural challenges, not lack of interest, as key reasons for the shortfall. In particular, delays in PJM’s grid interconnection process have slowed project development and limited participation in this initial round.
State officials and industry leaders emphasize that future procurement rounds, expected in 2027 and 2028, will offer more flexibility and a clearer picture of long-term market demand. Adjustments to program rules and additional stakeholder input are expected to improve participation.
There is also optimism about what comes next. Future procurements may allow paired solar-and-storage projects, a rapidly growing segment of the energy market that can improve both efficiency and project economics. Nationally, solar-plus-storage accounted for a large share of new energy capacity added in early 2026, highlighting strong developer interest.
Beyond utility-scale projects, Illinois is also seeing movement at the residential level. New programs are enabling homeowners and businesses to install solar panels and battery systems with little to no upfront cost, while contributing energy back to the grid during peak demand.
These “virtual power plant” models allow distributed energy resources to function collectively like a traditional power plant – adding capacity, improving grid resilience, and potentially lowering costs over time.
Still, challenges remain. Scaling storage to meet the state’s goal of at least 3,000 megawatts by 2030 will require consistent policy execution, improved grid infrastructure, and a regulatory environment that supports timely project development.
The takeaway here is a mixed but constructive outlook. Illinois is building momentum in clean energy and grid modernization, which can support long-term reliability and economic growth. However, near-term uncertainties, including regional bottlenecks, evolving program rules, and project timelines, will be important to watch as implementation continues.
In short, the direction is clear, but the pace and path forward will depend on how effectively the state and market participants navigate the next phase of execution.
Canada Trade Tensions Could Hit Illinois and Midwest Supply Chains Hard
Escalating trade tensions between the United States and Canada are beginning to ripple through the Midwest, with Illinois positioned to feel some of the most significant impacts.
As new tariffs take hold on both sides of the border, logistics and supply chain experts warn that businesses and consumers alike should expect rising costs and added strain on an already challenged global trade environment.
Illinois’ exposure is substantial. Canada is the state’s largest trading partner, receiving roughly $17.5 billion in Illinois exports annually while supplying key materials that support major industries across the region.
Some of those imports are less visible but highly consequential. Canada supplies about 80% of the potash used in U.S. fertilizer production, a critical input for agriculture. It is also a primary source of softwood lumber used in residential construction, meaning price increases could ripple into both food production and housing costs.
Manufacturing, particularly the auto sector, is also highly integrated across the U.S.-Canada border. Vehicle components often cross back and forth multiple times before final assembly, making the industry especially sensitive to tariffs that compound at each stage of production.
The latest round of tariffs reflects an ongoing policy shift in Washington. New measures were introduced following the expiration of earlier tariff programs and a court decision that struck down certain emergency authorities. In response, Canada has implemented countermeasures ranging from 15% to 50% on a wide array of U.S. goods, including steel, dairy, appliances, agricultural equipment, paper products, and electronics, generally mirroring U.S. tariff levels.
While each country is attempting to protect domestic industries, the near-term effect is likely to be higher input costs and more complex logistics planning for businesses operating in cross-border markets.
Industry leaders caution that replacing Canadian imports will not be simple or cost-effective. Geographic proximity, established infrastructure, and long-standing trade relationships make Canada uniquely efficient as a supplier.
“Alternatives are not going to be as close, as quick, or as affordable,” said a Midwest-based logistics executive, noting that shifting supply chains to other global partners introduces additional transportation costs and delays.
Those challenges are compounded by broader global shipping disruptions. Capacity constraints at key transit points such as the Panama Canal, ongoing security concerns in the Red Sea region, and congestion at major international ports continue to limit flexibility for companies seeking new sourcing options.
At the same time, some analysts note that the U.S. market represents a significant share of Canadian exports, which could create incentives on both sides to eventually ease tensions. However, any resolution may take time, leaving businesses to manage near-term volatility.
For Illinois and the broader Midwest, deeply integrated cross-border trade has long been a competitive advantage, but it also creates vulnerability when policy shifts occur. Companies in agriculture, manufacturing, construction, and logistics may need to reassess sourcing strategies, pricing, and risk management as the situation evolves.
Brandon Road Project Resumes as Invasive Carp Concerns Grow
Construction has resumed on the Brandon Road Lock and Dam project in Joliet, a critical effort to prevent invasive carp from reaching the Great Lakes. Work had been paused for more than a month following a federal stop-work order issued July 24. The project is now back underway after federal and state discussions, restoring momentum to the $1.15 billion initiative.
The timing is notable. During the pause, monitoring crews detected several hundred juvenile silver carp in the Illinois River roughly 80 miles from Lake Michigan, further upstream than previously recorded. Experts say the presence of young fish suggests possible spawning activity closer to the lake, raising concerns about long-term establishment.
The Brandon Road project is designed as a multi-layered defense system, replacing older electric barriers as the primary line of protection. Once complete, it will include technologies such as acoustic deterrents, bubble barriers, electric systems, and a flushing lock to stop or push back invasive species.
The stakes are high. Invasive carp threaten native fish populations and the broader Great Lakes ecosystem, as well as a regional economy tied to fishing, boating, and tourism.
The project is funded through a federal-state partnership, with the federal government covering 90% of construction costs. Illinois and Michigan are contributing $50 million and $64 million, respectively. Initial construction began in 2025, with work progressing in phases.
Regional stakeholders, from environmental groups to industry and government leaders, have emphasized the importance of keeping the project on schedule, noting that delays increase both ecological risk and long-term costs.
Meanwhile, monitoring and mitigation efforts continue in the Illinois River system, including increased surveillance and targeted removal of invasive carp populations.
For the region, the restart of construction is a key step forward, but the recent discoveries underscore the urgency of completing the project and maintaining vigilance against a potential Great Lakes invasion.
Stay well,
Mike Paone
Executive Vice President
Joliet Region Chamber of Commerce & Industry
mpaone@jolietchamber.com
815.727.5371 main
815.727.5373 direct