Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”
Chamber members:
Hello to 2022 – I hope the new year finds you all happy and healthy even though it seems like a little bit of déjà vu. We’re starting off with a few interesting pieces of information and certainly more to follow in the weeks ahead. Don’t forget that the minimum wage has gone up to $12.
First though, a special thanks to Silver Cross Hospital for their continued support as a sponsor of this update. Second, thank you to CITGO for coming aboard as an additional sponsor of your Roundup. We’ll have a much cleaner looking image in the next edition, I promise. Here’s to a prosperous and hopefully less bumpy 2022!
*Government Affairs Roundup brought to you by CITGO & Silver Cross Hospital*
What you need to know about the 2022 spring Illinois legislative session
The Illinois General Assembly will begin its spring session today. This is the only day the General Assembly is scheduled to meet this week. Legislators will likely not meet next week because of the COVID-19 risk, according to leadership in both the House and Senate.
“In the past 2 weeks, Illinois’ daily average of COVID-19 cases increased 130% and hospitalizations have risen 50%. This pandemic is not over,” said House Speaker Emanuel “Chris” Welch in a statement last week. “We must take necessary precautions to mitigate the spread of the virus, reduce the burden on our health care systems and keep each other as safe as possible.
What’s on the agenda?
Formal agendas for today hadn’t been released this early morning, though the House will likely need to pass rules change to allow lawmakers to vote remotely because of COVID-19. The Senate made a similar change permanent in 2020.
This spring, legislators will likely keep the controversial laws to a minimum because of the upcoming election, though they will need to pass a state budget. Gov. J.B. Pritzker said he expects more remote committee hearings because of ongoing COVID-19 concerns, but he laid out what his top priority is. “One priority every session is the No. 1 priority, and that’s balancing our budget,” Pritzker said during an unrelated news conference.
“Passing another responsible, balanced budget will be at the top of the list,” Senate President Harmon said in an interview. He indicated COVID-19 and legislative oversight also will be priorities.
Republicans likely will use this session as another opportunity to push for their “Reimagine Illinois” package of fiscal responsibility, ethics reforms, job opportunities and public safety, according to Rep. Ryan Spain, R-Peoria.
State Rep. Dan Brady, R-Bloomington, said having the truncated session could mean “wish list legislation” will go untouched “to the priority of trying to make sure we have a budget.”
“And stabilize that budget the best that we can with the dollars that have come in from the federal government, COVID-related, and using those dollars for what they’re supposed to,” Brady said. “And that’s a whole other discussion.”
Early focus on how taxpayer money is to be spent could bring more transparency that Brady said taxpayers haven’t seen in the past.
One issue that could come up in January is the vacancy of the Legislative Inspector General. Despite having six months to find a watchdog to take complaints about potential legislator wrongdoing, lawmakers failed to advance a nominee. Lawmakers could also face a veto of a bill on the governor’s desk that would allow teachers to take COVID-sick time as administrative time rather than drawing off allotted sick time.
Is it open to the public? What about COVID-19?
Normally, the House and Senate have galleries where members of the public can watch the legislature at work. Because of COVID-19, the public galleries in the Senate and House are closed. A livestream of the House and Senate is available when they are meeting on the General Assembly website. Anyone visiting the Capitol must wear a mask.
When will the session end?
The spring session is scheduled to end on April 8. This is earlier than most sessions, which run through the end of May. The reason for this change is to accommodate this year’s primary election, which will be on June 28. The primary was moved because of pandemic-related delays in the once-ever-10-years redistricting process.
Some Good Illinois Financial News
The state of Illinois has made a final payment of $302 million to pay back a $2 billion loan federal taxpayers gave Illinois in 2020 to cover COVID-19 expenses. Illinois was an outlier for borrowing from the Federal Reserve program that bought bonds from governmental bodies that needed immediate assistance.
“As it turned out, almost nobody sold them those bonds because they didn’t need to. The exception being the state of Illinois and the New York Metropolitan Transit Authority, the MPA,” said Committee for a Responsible Federal Budget Senior Vice President Marc Goldwein.
Illinois Comptroller Susana Mendoza said with the loan now paid off, Illinois taxpayers will save $82 million in interest payments. “With this early repayment, we take another important step toward restoring fiscal stability and predictability to Illinois,” Mendoza said in a statement Wednesday. “I can’t stand seeing taxpayer money wasted on interest – that’s why paying off this loan early was so important for me.” The loan was scheduled to be repaid in three installments by December 2023, the comptroller’s office said.
The state still has an outstanding $4.5 billion debt for unemployment insurance, which comes with potentially $100 million in interest if not paid off. While Illinois Manufacturers’ Association President and CEO Mark Denzler said he supports Mendoza’s request to have the federal government waive the interest because the pandemic is ongoing, he doesn’t foresee it being granted. In the meantime, the debt will still be owed.
“And that’s money that can be better spent on things like health care and infrastructure and public safety and economic development,” Denzler said. “Instead we’re likely to be using that to pay interest on a multi-billion dollar debt.”
Employers warn if the unemployment debt is not addressed, taxes will be increased on job creators and benefits for unemployed workers will be cut.
Redistricting News
A three-judge federal court panel has upheld the legislative redistricting plan that state lawmakers approved during a special session last summer, thus leaving in place the new maps that will govern state legislative elections for the next 10 years.
In their 64-page opinion, released Thursday, Dec. 30, the judges said the plaintiffs in the three separate lawsuits had failed to show that the redistricting plan violated federal law or the U.S. Constitution by diluting Latino voting power in Chicago and its surrounding suburbs or Black voting power in the Metro East region on the Illinois side of the St. Louis metropolitan area.
“In the end, we find that the boundaries for Illinois House and Senate districts set out in SB 927 neither violate neither the Voting Rights Act nor the Constitution,” the panel wrote. “The record shows ample evidence of crossover voting to defeat any claim of racially polarized voting sufficient to deny Latino and Black voters of the opportunity to elect candidates of their choice in the challenged districts.”
Michigan has its new, more competitive congressional district lines, adopted by a mix of Democrats, Republicans and independents on the citizen-led redistricting commission. Three of four partisanship measures indicate the new map will favor the GOP, but far less than the post-2010 map did; the current delegation is evenly split. The Detroit Free Press breaks it down
And Virginia officially has its new map, as the state Supreme Court took over the process after an independent commission deadlocked. Biden won seven of the 11 new districts, but two are tight and vulnerable for Democrats in a bad year. Democratic Rep. ABIGAIL SPANBERGER will still face a tough decision as her district moves north. More from the Richmond Times-Dispatch
December was a pretty good month by one metric
U.S. businesses added 807,000 jobs in December despite the emergence of the omicron variant, according to data released Wednesday by payroll processor ADP, far exceeding expectations.
For context: The ADP National Employment Report, a closely watched gauge of private sector job growth, showed private non-farm payrolls adding almost twice as many new workers as analysts projected.
On the flip side … A record 4.5 million workers quit their jobs in November. Workers quit their jobs in record numbers in November while the total employment openings pulled back a bit, the Labor Department reported Tuesday.
The so-called quits level surged to 4.53 million for the month, according to the department’s Job Openings and Labor Turnover Survey. That represented an 8.9% increase from October and broke September’s high-water mark of 4.36 million. As a percentage of the workforce, the quits rate of 3% matched September’s mark.
In a phenomenon that has been labeled the Great Resignation, workers have been leaving their positions partly in response to increased mobility in the labor market as job openings strongly outnumber those looking for work.
For November, the number of job openings totaled 10.56 million, lower than the 11 million estimate from FactSet and a decline from 11.09 million in October. The level, however, was well ahead of the 6.88 million total of those out of work and looking for jobs in November, according to the government’s nonfarm payrolls report for that month.
The job openings rate was 6.6%, down from about 7% in October but well ahead of the 4.5% from the prior year. “The Great Resignation shows no sign of abating, with quits hitting a new record. The question is why, and the answers are for starkly different reasons,” said Robert Frick, corporate economist at Navy Federal Credit Union. “COVID-19 burnout and fear are continuing, but also, many Americans have the confidence to quit given the high level of job openings and rising pay.”
A separate economic report Tuesday showed that manufacturing activity in December was slower than expected. The ISM Manufacturing Index registered a 58.7% reading, below the 60% expectation and a drop from 61.1% in November.
The biggest subtractions from the index came in supplier deliveries, which fell 7.3 percentage points, and a surprise plunge in prices, which dropped 14.2 percentage points at a time when inflation is running at its highest level in nearly 40 years. Survey responses indicated prices are declining some for steel and oil. A reading over 50% signals the manufacturing sector is expanding in general, while a reading under 50% is a sign it is mainly contracting.
On the upside, the employment index rose to 54.2%, a gain of 0.9 percentage point and a sign that hiring remains strong.
Rising omicron cases, CDC guidance threatens businesses
The decision to cut isolation time in half for those with asymptomatic COVID-19 is seeing backlash among employee representatives and experts who say big business sparked the decision more than science did. Crew and airline workers calling out sick made Christmas travel a nightmare across the U.S. But other industries such as retail and restaurants could be similarly impacted, leading businesses into temporary yet unintentional shutdowns — a politically unpopular way to curb the spread that President Biden is trying to avoid.
Just after the Centers for Disease Control and Prevention (CDC) announced it would cut isolation time for asymptomatic people infected with COVID-19 from 10 days to five, Anthony Fauci, the president’s top medical adviser, told CNN the reason for the change had to do with getting people back to work faster. With cases expected to surge, Fauci said, “One of the things we want to be careful of is we don’t have so many people out.”
“If you are asymptomatic and you are infected, we want to get people back to the jobs, especially those with essential jobs,” Fauci said. “They can get back to the workplace, doing things that are important to keep society running smoothly.”
The CDC said the change was driven by science showing that the majority of virus transmission occurs early in the course of illness, generally in the first two days prior to onset of symptoms and the two to three days after. The CDC’s change is getting significant pushback from employee representatives for being too focused on employers and not enough on workers.
Omicron Variant Is Expected to Dent Global Economy in Early 2022
A winter surge in Covid-19 cases driven by the Omicron variant is prompting economists to downgrade U.S. and global growth expectations in the early part of 2022 as businesses struggle with absenteeism and consumers stay home to avoid getting sick.
Several economists have recently cut forecasts for the U.S. following early signs that a sharp rise in cases has already disrupted parts of the economy. The federal Centers for Disease Control and Prevention reduced the amount of recommended time that infected people who are asymptomatic should isolate to five days from 10 as more research is done and thinking evolves on how best to manage the pandemic.
In Europe, leaders reviewed whether to put in place new limits on activity as New Year celebrations approached. The U.K. government decided against tightened restrictions after reviewing hospitalization data, but Health Minister Sajid Javid said people should celebrate New Year’s Eve outside if possible. U.S. officials are seeking ways to ease pressure on hospitals while also limiting business disruptions.
Mark Zandi, chief economist at Moody’s Analytics, downgraded his first-quarter U.S. gross domestic product forecast to 2.2% growth from 5.2% as he “can see the economic damage mounting going into the first quarter.” Mr. Zandi pointed to softer spending on travel and cancellations of sporting events and Broadway shows due to the disruptive Covid-19 outbreak.
“It feels like a very similar dynamic as when Delta hit,” Mr. Zandi said, referring to the Delta variant of Covid-19 that gripped the U.S. in the summer. He initially expected economic growth of 6.1% headed into the third quarter; in the end the economy expanded at a 2.3% pace from July to September.
The economy is estimated to have grown at an annual pace of 7.6% in the current fourth quarter, according to the Federal Reserve Bank of Atlanta’s GDP forecasting tool. Economists have struggled to predict the impact of Covid-19 on economies throughout the pandemic, including in the U.S., where changes in the labor market have surprised both the government and forecasters. Still, they expect Omicron will push economic activity from the first quarter into the second, with a smaller impact than from prior waves of the pandemic. The Federal Reserve earlier this month forecast that the U.S. economy would grow by 4% next year.
“Broadly speaking, each new wave is going to do a little less damage than previous waves,” said Mr. Zandi, adding that healthcare providers have gotten better at treating the virus and businesses are getting better at adjusting.
Recent spending data suggest the rise of the Omicron variant could be causing people to curtail spending outside the home. Restaurant visits in December have slipped as more people stayed home. For the week ended Dec. 26, the number of seated diners in U.S. restaurants was down 27% from 2019 levels, the widest gap since April, according to data from OpenTable.
In-store spending at retailers and restaurants also fell in late November and early December. For the week ended Nov. 30, spending was down 5.3% from the previous week. For the week ended Dec. 7, it was down 5.6% before rising 3.4% in the week ended Dec. 14, according to payment-card spending data tabulated by the Commerce Department.
The Omicron outbreak is sending employees home sick amid a staffing crunch that has led employers to cling to workers. Filings for unemployment benefits hovered at the lowest level in more than half a century the week ended Dec. 18.
Still, consumer demand for gifts remained healthy in the run-up to the holiday season. Americans spent at a brisk pace over the shopping season, amid an early rush to stores due to worries about Covid-related supply and delivery problems.
U.S. retail sales rose 8.5% between Nov. 1 and Christmas Eve compared with the same period last year, according to Mastercard SpendingPulse, which tracks sales in the Mastercard payments network coupled with survey-based estimates for cash and checks.
For now, economists expect the highly contagious Omicron variant to cause a short-term soft patch for U.S. spending and broader economic growth. It comes as central banks across the globe tee up expected interest-rate rises next year in an effort to tame inflation. The Federal Reserve has set the stage for a series of increases beginning in the spring.
The Latest on the Vaccine Mandate Lawsuits and What Employers Need to Know
As you know, the Biden Administration announced sweeping vaccine mandate requirements for large employers over the summer. The ETS issued by OSHA has been litigated recently in the courts. Here’s the latest on where those court rulings stand:
- On December 17, the U.S. Court of Appeals for the Sixth Circuit reinstated the OSHA ETS requiring employers with 100 or more employees to ensure their employees are fully vaccinated by January 4 or allow employees to submit weekly negative test results. This was a reversal of the previous stay by the Fifth Circuit.
- On December 22, the U.S. Supreme Court scheduled oral arguments for the ETS to occur on Friday, January 7.
- To account for the litigation uncertainty, OSHA updated their enforcement policy stating that it “is exercising enforcement discretion with respect to the compliance dates of the ETS.” It will not issue any citations before January 10 and will not enforce the vaccine or testing requirement until February 9 “so long as an employer is exercising reasonable, good faith efforts to come into compliance with the standard.”
- Click here to read more about the OSHA ETS, Federal Contractor Mandate and CMS Rule.
Washington D.C. News
Sen. Joe Manchin (D., W. Va.) cast doubt on a Democratic push to unilaterally change Senate procedures to weaken the minority party’s power, dealing a blow to party leaders’ push to change the filibuster and advance their elections bills.
Mr. Manchin said he was engaged in talks about possible changes to the filibuster rule, which requires the votes of 60 senators to advance most bills. But, he said, any changes should have the buy-in of Republicans as well, and he was leery of Democrats going it alone.
Many Senate Democrats have stepped up calls for altering the filibuster to make it easier to pass legislation. Republicans criticize that as a power grab and say it would ignore the bipartisanship that produced big legislation last Congress.
Senate Democrats put the party’s marquee economic package on the back burner, shifting their attention to passing elections legislation as they consider how to overhaul the roughly $2 trillion education, healthcare and climate bill. Mr. Manchin’s opposition to the bill scuttled hopes of quickly passing the centerpiece of President Biden’s legislative agenda.
Mr. Manchin is pushing for the party to restructure the bill, arguing among other issues that its design disguises the full cost of its programs which would provide funding for initiatives including healthcare subsidies, childcare subsidies and housing.
Senate Democrats on Tuesday say they expect President Biden to restart talks with holdout Sen. Joe Manchin (D-W.Va.) after a ‘cooling off’ period that will extend until the Senate finishes debate on voting rights legislation and rules reform.
Senate Democrats agreed at a virtual lunchtime meeting Tuesday that everyone in their caucus would take a deep breath and step back from the heated debate over Biden’s sweeping climate and social spending plan to give Manchin some space. Are any negotiations ongoing? No. “Manchin told reporters on Tuesday morning that there are ‘no negotiations going on at this time’ over Biden’s stalled ‘Build Back Better’ agenda.”
IDOT Virtual Workshops
The Illinois Department of Transportation will be offering several free, virtual workshops that will be hosted in January that may be of interest to some of our members. These workshops, entitled Building Blocks of Success, are designed for firms interested in participating in the Disadvantaged Business Enterprise (DBE) program and will focus on building skills to bid on state construction projects.
These workshops offer an opportunity for eligible small businesses in Will County to learn about the process for bidding on state construction projects. This is especially timely, as the ongoing Rebuild Illinois program is bringing millions of dollars’ worth of construction projects to Will County.
Administered by IDOT, the DBE program provides minorities, women and other eligible small businesses opportunities to participate in highway, transit and airport contracts that are federally and state funded.
The workshop dates and topics are:
- Jan. 6, 10 a.m. to noon: Excel Estimating and Bidding Worksheet
- Jan. 11, 10 a.m. to noon: Overhead Calculation Rate
- Jan. 13, 10 a.m. to noon: Improving your Personal Business (D&B) Credit Score
- Jan. 25, 10 a.m. to noon: QuickBooks: Setting Up your Company
- Jan. 26, 10 a.m. to noon: QuickBooks: Performing Day-to-Day Tasks
- Jan. 27, 10 a.m. to noon: QuickBooks: Reporting
Use this link for more information and to register for each event: https://www.eventbrite.com/o/idot-supportive-services-15629822218
Future topics covered include financing, additional QuickBooks training, estimating and bidding, insurance, management, steps needed to be certified as a DBE firm and more. Questions can be directed to IDOT’s DBE Resource Center at (312) 939-1100. Businesses can find more information on being about a certified DBE at www.idot.illinois.gov/dbe.
Downtown Joliet Plaza Grant Opportunity
The Illinois Department of Commerce & Economic Opportunity has announced available funding to support improvements and investments in commercial corridors. The program Rebuild Downtowns & Main Streets Capital Grant Program is offering up to $3,000,000.00 with a 1-1 match.
If received, these funds will go towards the design and construction of the long awaited Van Buren / Chicago Street Plaza. The preliminary design of the plaza is anticipated to be completed in 2022 and City Council will have approval of the final design. The city will have to match the grant amount. You can view renderings and further information about the downtown plan dating back to 2015 here: https://www.joliet.gov/home/showpublisheddocument/7943/635985640169830000
Stay well,
Mike Paone
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
mpaone@jolietchamber.com
815.727.5371 main
815.727.5373 direct