Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”
Chamber members:
We’re a week removed from the wrap up of the spring session in Illinois. Last week’s roundup provided a full recap of the state budget passage. All in all, more than 466 cleared both chambers of the General Assembly this session with 287 of them passing in the final two weeks.
Here is the Governor Pritzker’s budget statement – https://www.politico.com/f/?id=0000018f-c6fe-dd78-a59f-c6fecacd0000&nname=illinois-playbook&nid=00000150-1596-d4ac-a1d4-179e288b0000&nrid=0000015b-c463-d378-a1df-fefbeeb30000&nlid=639163
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Joliet Moving Forward on Comprehensive Plan
The City of Joliet is embarking on a significant spending endeavor to develop a comprehensive plan, with a proposed budget of $581,000. City planner Jayne Bernhard has revealed the plan, which entails hiring the Chicago-based company Lamar Johnson Collaborative.
The Lamar Johnson Collaborative proposes a project comprising five phases spread over 18 to 24 months, with each phase involving public engagement activities and associated deliverables. Here’s a breakdown of the phases:
Phase 1: Evaluate (includes project kick-off, data collection, and analysis)
Phase 2: Investigate (includes key person interviews and community visioning)
Phase 3: Enhance (includes workshops on key topic areas)
Phase 4: Empower (includes drafting the plan and preparing subarea plans)
Phase 5: Examine (includes preparing an implementation plan and presenting the final plan)
The project fee proposed by Lamar Johnson Collaborative is $564,250, covering extensive public engagement and preparation of the plan. Additionally, they suggest budgeting an extra $15,000 to $17,000 to cover direct costs and additional expenses, totaling the estimated project cost to $581,000.
To fund this initiative, Joliet plans to allocate resources across three fiscal years, with the Community Development Department having sufficient funds in its 2024 budget for the first year. Bernhard clarified that the project’s procurement process began more than 18 months ago, with six qualifications received from various firms.
Following a committee meeting, Joliet’s media relations director, Rosemaria DiBenedetto, disclosed plans to engage a second company, Urban3, for a specialized economic analysis. This analysis aims to evaluate the impact of development on the city’s finances and infrastructure, aiding policy decisions on future developments. Urban3’s fee proposal for the Economic Analysis is $138,768, partly expected to be covered by a $75,000 grant from the Joliet Arsenal Development Authority.
Illinois Chamber of Commerce Statement on the Final Bill of the Spring 2024 Legislative Session
The Spring Legislative session offered many opportunities to advocate for our dynamic and diverse membership base. We appreciated the opportunity to collaborate with legislators on both sides of the aisle and secure meaningful policy wins in the final days of the legislative session.
The Chamber has significant concerns about the revenue bill (HB4951) that passed in that it will ultimately be balanced on the backs of the taxpayers and businesses of Illinois. With an increase of more than $1B in revenue without commensurate cuts, it poses substantial problems moving forward with ARPA funds expiring in 2025 and pending transportation funding gaps going unaddressed. Representative Fred Crespo (D- Hoffman Estates) said it best during the debate on HB4951: “There’s really only one place that you can look at getting these revenues, and that is taxpayers.”
We would like to extend a special thank you to Senator Don DeWitte (R- St. Charles) and Keith Staats of the Chamber Tax Institute for their multi-year effort to get a long overdue legislative update changing the sales taxation of leasing from an upfront tax on the acquisition cost of the leased property paid by the lessor to a tax on the rental charges paid by a lessee. Illinois will now be in line with the rest of the country in how these leases are treated by IDOR.
“The Illinois Chamber remains committed to creating a pro-growth, pro-business, and pro-Illinois environment for existing businesses in the state as well as for businesses that we seek to attract,” said Lou Sandoval, Illinois Chamber President and CEO. “Growing our revenue base is a worthwhile effort, however, growth efforts will be for naught unless we apply fiscal balance and retain opportunities to help existing businesses grow. We look forward to being part of that conversation.”
Budget Allows Illinois Residents to Claim a Bigger State Tax Credit
Illinois residents can expect a larger state tax credit next year under the new budget. A tax credit, quietly reduced by lawmakers last year, is set to become more generous in the new state budget that has been approved by the legislature and awaits Governor JB Pritzker’s signature.
Known as the standard exemption, this tax credit had been increasing annually since 2011 to keep pace with inflation, thanks to an initiative introduced by former Democratic Gov. Pat Quinn. However, lawmakers decoupled the exemption from inflation following a significant rise in the consumer price index, spurred by COVID-19-related supply chain issues.
The Fiscal 2025 budget, which the Illinois House approved early last Wednesday, includes provisions to once again link the standard exemption to inflation. This change will increase the exemption individuals can claim for the 2024 tax year from $2,425 to $2,775, resulting in over $69 in tax savings for a family of four.
This adjustment is estimated to cost $172 million, nearly double the cost of a smaller increase proposed by Pritzker in his Fiscal 2025 budget plan last February. The governor had suggested raising the exemption to $2,550 for the 2024 tax year at a cost of $93 million, but lawmakers opted for a more substantial increase.
A top aide indicated that the governor supports a larger boost to the tax credit. “The budget is balanced, and there were other revenue proposals the General Assembly included in the final budget, along with a revenue revision upward that occurred after he proposed his budget in February,” said Pritzker spokeswoman Jordan Abudayyeh.
Since 2011, under Quinn’s tax law change, the standard exemption rose with inflation, from a $2,000 deduction in 2011 to $2,425 in 2022. If it had continued to follow inflation, the 2023 standard deduction would have been $2,625, reflecting the 8% increase in the consumer price index in 2022, the highest inflation rate since 1981.
Last year, Pritzker and the Democrats decided to maintain the $2,425 amount for the 2023 tax year, redirecting $114 million elsewhere in the budget. The inflation adjustment was set to resume for the 2024 tax year and continue through 2028.
Earlier this year, Quinn raised concerns when the standard exemption freeze was discovered in the state budget. “I’m very glad for all the taxpayers of Illinois,” Quinn said. “Eleven million benefit every year from the personal exemption amount, which is a tax-relief measure for everyday families that’s protected and indexed to inflation and the cost of living. Everybody knows we’ve had a tough time with inflation over the last few years.
“For the state not to index the personal exemption amount to inflation and the cost of living was really taking money out of the pockets of everyday people,” he added.
Quinn emphasized the importance of a fair tax system for everyday families. “I think Gov. Pritzker and the legislature should realize that a fair tax system is one that is fair to everyday people raising children, and that’s really what this tax relief is all about,” he said.
Invest in Kids Omission
As reported last week, the $53.1 billion Illinois spending plan is the most expensive taxpayer-funded state budget in Illinois history, marking a 32% increase from the state’s spending in 2019. This measure includes tax credits for music, live theater, the electric vehicle industry, donations to endowments, and more.
One topic that received a lot of attention last session, going all the way until the veto session, was the expiration of the Invest in Kids program. Many looked at the program as one that ensured our children who are in underperforming schools have an opportunity to get a scholarship to a school that will better prepare them for the future.
Governor Pritzker blamed the legislature for not reauthorizing the Invest in Kids program but criticized the original measure. “If you’re going to have a tax credit like that, we ought to let the federal government cover much of the cost of it, which we weren’t doing,” Pritzker said.
The program was allowed to sunset last year, but before it ended, tens of thousands of families benefited from the opportunity. It will remain to be seen if talks are revived in the future.
State Identification Goes Mobile
Residents would be able to keep digital versions of their driver’s licenses and other state IDs on their cellphones under legislation promoted by Secretary of State Alexi Giannoulias.
“Whether it’s offering more services online, reducing wait times at DMVs, or introducing products like digital driver’s licenses, we want to leverage new secure technology to better serve our customers,” Giannoulias said in an interview shortly before the Senate passed the measure with a unanimous 58-0 vote last week. The House also passed it without opposition.
Eligibility for a mobile identification card would mirror that of the physical credential and would likely be accessible through an app, Giannoulias explained. According to the bill, the app needed to display the digital license or ID on a phone would cost consumers no more than $6.
While the mobile ID would be acceptable in most situations, the legislation mandates that individuals show law enforcement the physical copy of their driver’s license or regular ID upon request.
The American Civil Liberties Union (ACLU) of Illinois voiced opposition, raising privacy and security concerns. ACLU spokesman Ed Yohnka criticized the bill for not providing protection against deeper phone searches by law enforcement.
“We would have liked some additional specific statutory language that would create a consequence if law enforcement used the mobile ID as a pretext to access someone’s phone, in violation of the usual protections around unlawful search and seizure,” Yohnka said.
Yohnka also highlighted other concerns, including potential discrimination by businesses over customer use of one form of ID over the other and safety issues regarding the collection and storage of mobile ID information.
Giannoulias emphasized that having a mobile ID will remain optional for residents and suggested that this option could enhance privacy since people could choose to share only the information necessary for their transaction.
“Digital IDs offer privacy control options that allow people to verify their age when legally purchasing alcohol, cannabis, or renting a car, and it also allows us to do this while hiding other personal information like their address if they wish,” Giannoulias said.
If Governor Pritzker signs the bill, Giannoulias’ office will need to finalize the details of how mobile IDs will be implemented and enforced. Giannoulias stated that he does not have a timeline for when they will become available to the public.
“We know that people in Illinois want this,” Giannoulias said.
Medical Debt Erasure
Lawmakers have approved a major initiative by Governor Pritzker aimed at eliminating up to $1 billion in medical debt for over 300,000 Illinois families. This effort follows a similar program in Cook County that, as of last year, was on track to clear medical bills for approximately 73,000 residents.
“Many walk away with unexpected pain” after receiving medical care, Pritzker said at an event promoting the initiative in April. “Not only the emotional and physical toll of the crisis they’ve been through but a serious financial toll as well.”
The state legislation will partner with the nonprofit organization Undue Medical Debt, allocating $10 million to buy and erase medical debt.
Medical debt disproportionately affects people of color, noted Department of Healthcare and Family Services Director Lizzie Whitehorn at the April event. She added that it can also cause people to reconsider seeking future medical care.
However, a study released earlier this year, conducted in partnership with the same debt relief nonprofit (formerly known as RIP Medical Debt), found that eliminating medical debt did not improve recipients’ financial distress or mental health.
Pritzker acknowledged the study but pointed out that it was conducted from 2018 to 2020 and emphasized that the organization has changed significantly since then.
Nonprofit Board Diversity Mandate
Illinois is on the verge of becoming the first state to emphasize the diversity of nonprofit organization boards, according to proponents of the initiative.
Governor JB Pritzker backs Senate Bill 2930, recently approved by the General Assembly, which mandates that Illinois-based nonprofit organizations distributing $1 million or more to charitable groups disclose their board composition—by race, gender, and sexual orientation—on their websites annually.
The aim is to encourage foundations and major nonprofits to diversify their boards, explained State Senator Adriane Johnson, who sponsored the bill alongside State Representative Edgar Gonzalez Jr.
“We are taking crucial steps to promote diversity and inclusion within the nonprofit sector,” Johnson shared with Playbook. “We are creating spaces where individuals can embrace their true, unfiltered, and authentic selves.”
This initiative isn’t solely about board members embracing authenticity; it’s also about constituents feeling represented by nonprofit boards, noted Equality Illinois, an advocate for LGBTQ rights.
The bottom line: “It’s essential for foundations to mirror the communities they serve. With this legislation, grantees, community organizations, and leaders can assess the diversity of foundation boards of directors and collaborate with them to ensure that their leadership aligns with community demographics,” stated Equality Illinois CEO Brian Johnson to Playbook.
This measure mirrors a recently enacted law requiring Illinois-based companies to disclose their corporate board makeup based on sexual orientation, race, or ethnicity. Similar data collection and reporting mechanisms will be employed.
Recurring Business:
Verizon Small Business Digital Ready (VSBDR) program
The Verizon Small Business Digital Ready (VSBDR) program aims to equip small businesses with the tools they need to thrive in the digital age. Through a grant program available until June 28, 2024, entrepreneurs can access a wealth of educational resources, including personalized learning modules and expert coaching on various business aspects such as legal matters and marketing strategies. To qualify for grant funding, participants must complete two courses, coaching events, or community events by the deadline. Additionally, joining the program unlocks access to a range of tools, solutions, and networking opportunities to support business growth and foster connections within the small business community.
Learn more about the Verizon Small Business Digital Ready (VSBDR) program HERE.
Stay well,
Mike Paone
Executive Vice President
Joliet Region Chamber of Commerce & Industry
[email protected]
815.727.5371 main
815.727.5373 direct