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Next Session Dates: House & Senate: March 20 – 23
IMA Fights $6 Billion Gross Receipts Tax
With battle lines clearly drawn in the sand, the IMA is leading the fight to defeat Governor Blagojevich's proposed $6 billion tax hike on Illinois employers. Imposing a gross receipts tax (GRT) will be devastating for the manufacturing sector because the tax "pyramids" in the various stages of production and unfairly penalizes companies with low-profit margin. Further, the GRT encourages large companies to buy from suppliers located outside of Illinois.
In addition to educating IMA member companies, engaging in media outreach, and speaking directly to legislators, the IMA is leading the unified effort of the business community to counter the Governor's massive and multi-million dollar public relations campaign. As a co-founder of the Coalition for Jobs, Growth & Prosperity, the IMA is helping raise the necessary resources to fund a coordinated media campaign that could involve television, radio, and direct mail to win the battle.
We need your help – if you would like to contribute to our media campaign, or lend your company's name to the list of opponents, please email Mark Denzler today at mdenzler@ima-net.org.
House Revenue Committee to Begin Hearings on Illinois Economy
Under the leadership of Chairman John Bradley (D-Marion), the House Revenue Committee will begin a series of bipartisan hearings next week on key fiscal topics. At the initial hearing, the Committee will hear testimony regarding the performance of the Illinois economy over the past five years and projections for the next five years. In addition, it will provide a comparison of the state's economy to the Midwest and nation as a whole. Future hearings will delve into the gross receipts tax, service and property taxes, state debt, alternative tax structures, and the sale or lease of state assets.
The IMA has been invited to attend and participate in the hearings. It is critical that legislators understand the importance of manufacturing to the state's economy -manufacturers employ more than 675,000 Illinoisans and contribute 13 percent of the state's Gross Domestic Product (GDP). While the Governor has failed to reach out to the business community, the IMA appreciates the opportunity to address members of the House on these critical issues.
Illinois Business Day – Make Your Voice Heard
If you are concerned about the Governor's plan to impose a $6 billion gross receipts tax or create a 3 percent tax on your company's payroll to fund universal health care, then you need to attend the 2007 Illinois Business Day in Springfield on May 2. This year's event will focus on taxes, health care, and energy.
We need a show of force from the business community on May 2. Members of the education unions will also be in town that day to lobby in favor of the tax increases – employers need to stand up and be counted to show legislators that this massive tax hike will cripple the economy.
Sign up today and plan to join hundreds of your colleagues in the State Capitol! Sponsorships are also available.
IMA's Capitol Battle Plan Advances in Senate
Two initiatives of the Illinois Manufacturers' Association (IMA) advanced in the Senate Revenue Committee this week. The first measure, SB 1687 (Jacobs, D-Moline) will create a tax exemption for energy used in the manufacturing process. Despite the effort of manufacturing companies to become more energy efficient, the cost of energy remains a major factor in staying competitive. According to a national report, the surge in energy costs is one reason for a decline in workers' real wages. Exempting the state tax on natural gas and electricity will encourage and strengthen the industrial sector. SB 1687 overwhelmingly passed Committee by a vote of 8-0-1.
The Senate Revenue Committee voted unanimously to approve SB 1180 (Link, D-Vernon Hills) that will create an alternative Research & Development tax credit in Illinois. The legislation, modeled after a federal law, will provide a 12 percent tax credit for companies that expend significant, but level, amounts of R & D expenditures in Illinois. Currently, only companies that have increasing amounts of R & D are eligible for the credit.
Finally, the Revenue Committee in the House of Representative took subject matter testimony on HB 3415 (Munson, R-Elgin). Another IMA initiative, this bill would create a tax credit for wages paid to manufacturing employees. The credit would apply to the first $25,000 of an employee's wages and be available to companies that offer health care benefits to its workers.
The IMA appreciates Senator Terry Link, Senator Mike Jacobs, Representative Ruth Munson and all members of the Senate Revenue Committee for their strong support of the manufacturing industry.
Diesel Emissions Reduction Bill Passes Committee
Members of the Senate Energy & Environment Committee passed legislation, SB 268 (Collins, D-Chicago), that creates the Diesel Emissions Reduction Fund. According to the legislation, a surcharge will be imposed on the retail sale or lease of certain diesel vehicles (2006 model of earlier) that are not equipped with level 3 controls. In addition, the Secretary of State, in consultation with the Department of Transportation and Environmental Protection Agency, shall develop a program for diesel non-road vehicles, locomotives, and marine vessels that takes effect in January 2009. SB 268 passed committee by a vote of 7-4 and now moves to the full Senate for consideration.
Biomonitoring Legislation Advances
Legislation (HB 680) creating the Biomonitoring Safety Net Act passed the House Energy & Environment Committee this week by a vote of 12-3. Sponsored by Rep. Elaine Nekritz (D-Des Plaines), the legislation is ultimately designed to create a program that will monitor the presence and concentration of designated chemicals in Illinoisans. Under the legislation, the University of Illinois-Chicago and Great Lakes Center for Occupational and Environmental Safety and Health, in consultation with a newly created Scientific Guidance Panel, will conduct a feasibility study on how to best monitor chemicals and their impact. The IMA believes that the Center for Disease Control, which released the most extensive assessment in history in 2005 and current operates a National Biomonitoring Program, is best equipped to handle this important issue.
Electronic Scrap Recycling Bill Shelled
After countering significant opposition, Sen. Susan Garrett (D-Lake Forest) chose to remove all substantive legislative from the Electronic Scrap Recycling legislation (SB 1583). After all of the language was eliminated, the Senate Energy & Environment Committee passed the bill so that discussions can continue. It's unlikely that the measure will be called for a vote unless all sides can reach consensus.
Anti-Jobs Bill Sent to Subcommittee
Legislation that would have prevented companies from either receiving any state or local tax incentives or selling their products to state and local governments was sent to a subcommittee of the Senate State Government Committee after strong opposition was raised by the IMA and members of the business community. Under the terms of SB 1255 (Noland, D-Elgin), no employer would be able to receive the incentives or sell their products to government if they had "outsourced" more than 100 jobs in a year. This anti-business legislation would have led directly to additional job loss and reduced sales if enacted. It is anticipated that the bill will not be considered again this year.
Joint & Several Liability Changes
After passing from the Senate Judiciary Committee, legislation changing the apportionment formula for joint and several liability sits before the full Senate. Contained in SB 1296 (Cullerton, D-Chicago), the legislation seeks to tilt the level playing field and change law that has been in effect for decades. Sen. Cullerton continues to have discussions with both sides in an effort to achieve some consensus which is unlikely. The IMA opposes this trial lawyer initiative.
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