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Next session dates: House & Senate: May 21-31, 2007
Tax and budget chess match continues
With less than three weeks remaining in the scheduled legislative session, the Governor and four caucuses appear to be playing a game of five-way chess. Each calculated move, whether played offensively or defensively, is countered in some form or fashion by one or more of the parties engaged in the methodical debate. While the sides are moving, it appears that the Governor and legislative leaders remain far from resolving the budget stalemate and adjourning by May 31. Once session officially goes into "overtime" it will require a supermajority vote (as opposed to a simple majority) to pass the budget. Under the scenario, Republicans in the House of Representatives will have a voice at the table along with Democrats who control the House and enjoy a veto-proof majority in the Senate.
Despite a resounding vote in the House rebuking the gross receipts tax last week, Governor Rod Blagojevich and Senate President Emil Jones continue to call for imposition of a nearly $8 billion tax hike. House Speaker Michael J. Madigan officially opposes the GRT, but has also indicated publicly that he believes a tax increase is necessary to raise additional revenue for essential state programs and services. Finally, Senate Republican Leader Frank Watson and House Republican Leader Tom Cross continue to call for a "live within your means" budget that utilizes only natural revenue growth.
Late in the week, when there appeared to be some growing sentiment among rank and file lawmakers for a "no growth" or "maintenance" budget, fifteen Democrat senators led by Sen. James Meeks (D-Chicago) signed an open letter calling for substantial increased spending. Claiming that a no-growth budget would be "unconscionable," the Senators indicated support for Emil Jones' "original version of education funding reform" which included an income tax hike and property tax relief.
While the state faces a very serious budget deficit ($2.3 billion) and long-term financial problems, the IMA believes that it is irresponsible for lawmakers to simply throw money at the problem without making real structural reforms. The IMA continues to offer suggestions and recommendations that will help right the state's fiscal ship.
Trial lawyer agenda advances
Two bills offered at the request of the Illinois trial bar continue to advance through the General Assembly despite strong opposition from the IMA and business community. HB 1798, sponsored by Rep. Jim Brosnahan (D-Oak Lawn) and Senator Kwame Raoul (D-Chicago) passed the Senate Judiciary-Civil Law Committee on a partisan vote and narrowly passed the entire Senate by a two-vote margin. The legislation amends the Wrongful Death Act and allows a judge or jury to consider grief, suffering, and mental suffering when awarding damages. HB 1798 now awaits the Governor's signature.
Democrat Senator Mike Jacobs (D-Moline) joined the entire Republican caucus in opposing HB 1798. We appreciate their leadership on this issue.
The second and potentially more damaging bill, SB 1296, seeks to change the proportional formula used in determining joint and several liability. Sponsored by Sen. John Cullerton (D-Chicago) and Rep. Julie Hamos (D-Chicago), the legislation is a last-minute attempt by the trial lawyers to retroactively circumvent the Illinois Supreme Court which will hear arguments in the Reavy case next week. The Court could uphold current law and an Appellate Court decision which provides a defendant deemed less than 25 percent at-fault cannot be held liable for a majority of the damages. If trial lawyers are successful in passing the legislation, defendants could be held liable for 100 percent of the damages in a case even if they are only one percent at fault. Dubbed the "deep pockets" bill, it will increase lawsuit awards. SB 1296 passed the House Civil Law Committee on a partisan vote and is one step from the Governor's desk.
At the press conference this week, IMA president & CEO Greg Baise attested that passage of SB 1296 will further erode the business climate in Illinois. Noting that Illinois has lost nearly 200,000 manufacturing jobs in the past several years, Baise stated that SB 1296, along with the gross receipts tax and payroll tax, will drive jobs out of state. Baise was joined at the press conference by representatives from local governments, insurance industry, and other business groups.
The IMA encourages companies to contact their local state representative and ask them to vote "NO" on SB 1296.
Senate panel advances FMLA expansion
Legislation that will broaden the FMLA, sponsored by Rep. Jack Franks (D-Woodstock) and Senator Terry Link (D-Vernon Hills), moved one step closer to passage when the Senate Labor Committee approved it on a 6-4 partisan roll call this week. HB 374 seeks to create an Illinois Family and Medical Leave Act that mirrors federal law while expanding the list of extended family members covered by the current federal act. Under the Illinois legislation, employers with more than 50 employees will be required to provide up to 12 weeks of unpaid leave for immediate and extended family members. The bill, if passed by the full Senate, will return for a House concurrence vote before being sent to the Governor.
Illinois Clean Car Act moves to the House floor
Members of the House Environmental Health Committee voted Tuesday in favor of the Illinois Clean Car Act. Representative Karen May (D-Highland Park) offered the bill to the Committee which ultimately approved it 7-5 after more than an hour's discussion. The overly ambitious HB 3424 requires the Illinois EPA to establish a Clean Car Program by July 1, 2008 in which all cars, model year 2011 and later, must meet minimum motor vehicle emission standards and compliance requirements in order to be licensed in the state of Illinois. Illinois is the fourth largest automobile employer in the United States, so the bill could have negative ramifications for the automobile industry in this state.
The legislation, an initiative of environmental groups, is opposed by the IMA, Alliance of Automobile Manufacturers and AFL-CIO. SB 3424 would implement many strict environmental standards that are currently in place in California. If enacted, the bill could increase the cost of a car and possibly result in job losses across the state.
For the second time in recent weeks, Republican Paul Froehlich (R-Schaumburg) broke ranks and cast the deciding vote against the IMA and business community. The IMA would like to thank Rep. Kevin McCarthy (D-Orland Park) and the other Republican members of the Committee who opposed this anti-competition bill.
Illinois joins The Climate Registry
Last week, Governor Rod Blagojevich announced that Illinois has joined 30 states (including Michigan, Missouri, and Minnesota) as a charter member of The Climate Registry, a multi-state effort designed to address climate change in the United States. The organization will seek to create national standards that businesses and governments can use to document their current levels of greenhouse gas (GHG) emissions and track progress over time.
Under current law, neither Illinois nor the federal government requires companies to report GHGs. Under the new venture, beginning in January of 2008, businesses and other organizations will be able to voluntarily report their emissions to The Climate Registry which will use a set of common standards to measure and report findings. Illinois EPA Director Doug Scott believes that "you cannot manage greenhouse gas emissions without accurately measuring them first."
Earlier in the year, the Governor announced a statewide goal of cutting the production of greenhouse gases to 1990-levels by the year 2020 and 60 percent below 1990-levels by the year 2050. Interestingly, he announced his "goals" at the same time he appointed a Climate Change Task Force to study the issue and report back findings. Unfortunately, the Governor chose not to invite the IMA or any business trade association to be part of his effort. The IMA certainly supports energy conservation and environmental protection programs and hopes that the Governor will seek to work in concert with the business community in the future.
SAVE THE DATE . . .
ILLINOIS MANUFACTURERS' ASSOCIATION
Annual Luncheon & Meeting
Friday, December 7, 2007
Chicago, Illinois
It's never too early to mark your calendar and plan to attend the IMA Annual Luncheon & Meeting.
This year's gala event will feature several prominent keynote addresses.
In addition, companies will be recognized for their longevity in the IMA and "Manufacturers of the Year" will be announced.
We look forward to seeing you in December!
Other Springfield Highlights available online
