103rd GENERAL ASSEMBLY:
The Legislative session has concluded for the week. The Illinois Senate was in session Tuesday through Friday; session for today and Sunday was canceled. The Illinois House was in session Tuesday through Thursday. Both chambers return to session on Monday, May 8.
May 11 is the House Third Reading deadline in the Senate. May 12 is the Senate Bill Third Reading deadline in the House.
There are two weeks left in the Spring session. Adjournment is scheduled for May 19.
Note, the Senate created an Agreed Bill List with 108 bills to expedite final passage of non-controversial legislation. One roll call will be taken on Wednesday for legislation on the Agreed Bill List. View the list here.
Budget Pressures: Lawmakers are facing continuing budget pressures as they work to finalize the FY 24 budget. This week, HFS Director Theresa Eagleson told the Senate Appropriations Committee that the estimated cost for Illinois to continue providing health care coverage to noncitizens who are otherwise ineligible for Medicaid benefits has been revised upward to $1.1 billion (up from the end of March estimate of $990 million) for the upcoming fiscal year. The new estimate is now $880 million beyond the $220 million estimate included in Governor Pritzker’s February budget proposal. Read more here.
Cook County Board President Toni Preckwinkle was in Springfield this week asking for an additional $1.8 million in state funding to help Cook County pay for the health care costs of asylum seekers. Chicago Teachers Union President Stacy Davis Gates and Chicago Public Schools CEO Pedro Martinez were also in the Capitol this week seeking increased funding for Chicago Public Schools (the Governor’s proposed FY 24 budget allocates $27 million for CPS).
The General Assembly also learned this week that its forecasting commission downsized its revenue projections for the current fiscal year by $738 million. They did not, however, alter their projection for the upcoming fiscal year. (Read more on the topic below.) The Commission’s projections have been somewhat higher than the Governor’s Office of Management and Budget calculations and it appears that budget makers are trying to use the more conservative estimates as they craft the FY 24 budget.
COGFA Adjusts FY 23 Revenue Projections:
The FY23 revenue forecast has been downsized by $738 million – for a total outlook of $51.2 billion – by the Commission on Government Forecasting and Accountability, citing a steep drop-off in General Funds revenues.
The main culprit: underperforming revenues from personal income taxes in the final tax payment period. COGFA notes that this revenue stream has a net adjustment of -$840 million, joining disappointing performances in Sales Taxes (downwardly adjusted to -$94 million net) and Federal Sources (assigned a -$50 million projection). Recent months have seen lower trending revenues in all three categories, COGFA said.
However, a boost in projections was seen in three areas as well. Corporate Income net receipts were upwardly adjusted by +$135 million, joining All Other State Sources in its uptick (+$86 million) as well as Transfers In (assigned the more optimistic +$34 million).
Looking ahead to the FY24 revenue projection, COGFA has indicated it anticipates keeping the estimate at approximately $50.4 billion. Read more here.
April Revenue Update: A deep dive in General Funds revenue – to the tune of $1.844 billion – occurred in April 2023, compared to the same month of the previous year. The steepest drop off took place in Personal Income Taxes, toppling to $1.763 billion below April 2022 levels (a net basis fall-off of $1.507 billion). The Commission on Government Accountability and Forecasting had anticipated an underperformance in this area, but the actual decline was far more dramatic.
Adding to the woes of the General Funds revenues were two other categories: Corporate Income Taxes and Sales Taxes. Corporate Income Taxes were down $94 million ($66 million net). While Sales Taxes had a downtick of $5 million in April on a year-over-year basis, when adjusted for non general funds distributions (to the Road Fund and other transportation funds), the drop is $31 million.
Encouraging developments were seen in interest gleaned on State Funds and investments, which delivered $25 million in April. Insurance Taxes and Fees increased FY23 gains by $20 million. More modest contributions to the state’s coffers came from Other Sources (+$4 million); Public Utility Taxes (+$1 million); and the Cigarette Tax (+$1 million). These gains were essentially offset, however, by downturns in April in the Inheritance Tax (-$46 million); the Liquor Tax (-$7 million); and the Corporate Franchise Tax (-$2 million).
Revenues from Transfers In grew an anemic $1 million in April. Even though Lottery Transfers were an impressive $24 million above last April’s levels, and Casino Gaming Transfers registered at $2 million more than April 2022, miscellaneous transfers fell $24 million and Cannabis Transfers dropped $1 million. Capping off the substantial falloff in April revenues: a $237 million year-over-year decline in federal sources.
Broadband: Senator Ventura filed SFA #1 to SB 851 which requires the Broadband Advisory Council to encourage the expansion of the Illinois Century Network, including issuing recommendations for increasing agency staffing, infrastructure development, price modeling, and deployment that prioritizes areas that are unserved by broadband or any broadband network, as well as study the feasibility of connecting all anchor institutions. Includes correctional facilities in the definition of “anchor institution.” The amendment is currently assigned to the Senate State Government Committee.
Representative Harper filed HFA # 1 to HB 2520 which deletes the $200,000 supplemental fees for the new or revised air pollution construction permit application. The underlying legislation addresses Environmental Justice by granting additional rules and tools to the Illinois Environmental Protection Agency regarding the designation of environmental justice communities. The bill also updates the permitting process for any new construction. HB 2520 remains on Postponed Consideration in the House with the Third Reading deadline extended until May 19. HFA # 1 is scheduled for a hearing before the House Energy and Environment Committee on May 9.
Affordability of Prescription Medication: An amendment was filed in the Senate this week to HB 2189 (Guzzardi/Murphy) which caps insulin at $35 per month and creates a discount program that allows participants to purchase insulin at a discounted, post-rebate price. The amendment moves the administration of the discount program from IDPH to CMS. The amendment is assigned to the Senate Insurance committee. HB 2189 is on Third Reading in the Senate.
HB 3957 (Syed/Koehler), which creates the Pharmaceutical and Health Affordability: Restrictions on Manufacturers’ Amoral Behavior through Reasonable Oversight Act was considered again on Third Reading in the House (it previously failed on Third Reading deadline day). The bill prohibits a manufacturer or wholesale drug distributor from engaging in price gouging in the sale of an essential off-patent or generic drug and gives the Attorney General the ability to investigate when prices rise above a certain level. HB 3957 passed the House by a vote of 84-25 and now heads to the Senate.
Packaging and Paper Stewardship: Senator Koehler filed SFA # 2 and #3 to SB 1555. The underlying bill creates the Packaging and Paper Products Stewardship Act which establishes a producer responsibility program for paper and package recycling. The sponsor testified that the plan is to pass SB 1555 as amended by SFA # 2 and then continue to work on the bill in the House. The goal of the bill, as amended, is to create an Advisory Committee to conduct a recycling needs assessment.
As amended by SFA #2, the legislation creates the Statewide Recycling Needs Assessment Act. The amendment creates a Statewide Recycling Needs Assessment Advisory Council to provide advice and recommendations to the Environmental Protection Agency in the drafting, amendment, and finalization of the Statewide Recycling Needs Assessment. SB 1555, as amended, passed the Senate 37-16-1 and now heads to the House.
Wage Transparency: HB 3129 (Canty/Pacione Zayas), as amended, requires employers with 15 or more employees to disclose the pay scale and benefits in job postings. Empowers the Department of Labor to initiate an investigation of violations. Also authorizes the Department to investigate and levy civil penalties against employers that violate provisions concerning the posting of pay scale and benefits. The sponsor testified that the amendment was heavily negotiated and represents an agreement in “substance” with advocates and the business community. A further floor amendment is expected which the sponsor noted will address some remaining concerns. The Senate Executive Committee approved HB 3129, as amended, by a vote of 8-4.
Healthcare Mergers and Acquisitions: HB 2222 (Gong-Gershowitz/Gillespie) requires that the Attorney General be notified of mergers and acquisitions of certain health care facilities and large provider organizations. Allows the Attorney General to impose penalties for failure to report these actions. The bill is an initiative of the Attorney General. Passed the Senate Executive Committee 11-2 and now heads to the full Senate.
Property Tax Sale Reform: Representative Buckner filed HFA# 1 to SB 1675 (Cunningham/Buckner) which represents property tax sale reform. The sponsor testified that the goal of the legislation to allow is allow revitalization in areas with a high rate of abandoned properties. He noted the legislation allows builders to gain access to abandoned properties for redevelopment after one annual tax sale cycle instead of allowing “out of state investors to profit off of doing nothing and letting vacant lots deteriorate as they cycle through the bureaucratic tax sale system.”
As drafted, the amendment (1) allows local counties and municipalities to quickly intervene after failed delinquent tax sales to save abandoned properties; (2) reduces taxpayer funded payouts to property tax buyers by narrowing the sale in error loopholes; (3) cuts in half the monthly interest rate on delinquent taxes for homeowners from 1.5% to .75%; and (4) eliminates tax buyer leverage in Cook County which makes the scavenger sale optional.
Opponents testified that as drafted, the legislation is overly broad, needs to be narrowed and its notice provision needs some changes. Opponents would like to continue to work with the sponsor in an attempt to reach an agreement. The sponsor promised to continue negotiations with the opponents. HFA # 1 passed the House Revenue Committee on a partisan roll call 11-6 and is now pending before the full House.
All Day Kindergarten: HB 2396 (Canty/Lightford), as amended, mandates schools offer all-day kindergarten. Note, while schools must offer the option, students are not required to attend all-day kindergarten. Allows certain districts to apply for a two-year extension if the school meets certain criteria. Creates a Task Force to access the current state of full day kindergarten, as well as the capacity and cost of providing full-day kindergarten statewide. Passed the Senate Education Committee unanimously. SFA # 3 was filed Friday and is pending in the Senate Assignments Committee.
Electric Vehicle Charging: SB 40 (Feigenholtz/Gabel requires new construction of single-family homes and multi-unit residential buildings to include basic infrastructure for electric vehicle charging in a certain number of parking spaces. The bill also establishes rights and obligations for tenants and condominium unit owners seeking to install an EV charger on their own, while granting property owners the ability to recoup costs when an EV charging system is installed or removed at the request of a tenant or unit owner. Passed the House 69-38-1 and now heads to the Governor’s Desk.
Anti- Censorship: HB 2789 (Stava-Murray/Murphy) requires each Illinois library that receives State grants to establish an anti-censorship policy. Specifically, it states that libraries will be eligible for State grants only if they either “adopt the American Library Association’s Library Bill of Rights” or “develop a written statement prohibiting the practice of banning books or other materials within the library or library system.” Passed the Senate by a vote of 39-19 and now heads to the Governor’s desk. The bill was an initiative of Secretary of State Alexi Giannoulias.
Consumer Owned Containers: HB 2086 (Stava-Murray/Edly Allen) is an initiative of the Illinois Environmental Council. As amended, the bill creates health standards for individuals wishing to bring their own to-go containers to retailers and restaurants to do so in a safe and healthy manner. HB 2086 passed the Senate 54 -0 and now heads to the Governor’s Desk.
Rideshare: HB 2231(Gong-Gershowitz/Martwick) extends the repeal of the Transportation Network Providers Act for five years — from September 1, 2023 to September 1, 2028. Further clarifies that rideshare drivers will remain independent contractors. As amended, the bill also subjects rideshare companies to the same type of lawsuits that can be filed against taxi companies and others. HB 2231 passed the Senate 38-18 and now heads back to the House on Concurrence.
House Democrat Staff Seeks to Unionize: About two dozen House Democrat staffers (composed of those who work in legislature, research and appropriations roles) are seeking to unionize. A statement from the Illinois Legislative Staff Association (the newly proposed union) reads “Many employees struggle to pay their bills, are forced to work overtime hours with little compensation, and work extra jobs to make ends meet.” ILSA went on to note that, “These conditions have led to unsustainable staff turnover and have impeded our ability to serve the people of Illinois.”
The move comes roughly six months after Illinois voters approved a constitutional amendment to make it a “fundamental right” for workers in Illinois to unionize and collectively bargain. According to the union, the effort has been underway for about six months. Speaker Welch has not commented on the situation. Read more here.
Elected Chicago School Board: The Senate Special Committee on an Elected Chicago School Board will hold a virtual subject matter hearing on May 9 am 5pm to discuss the drawing of new board districts.
2023 Key Dates:
May 11: Deadline – Third Reading Substantive House Bills in Senate
May 12: Deadline – Third Reading Substantive Senate Bills in House
May 19: Adjournment
Executive Order: Executive Order 2023-07 Reissues previous Executive Orders related to the COVID-19 pandemic through May 11, 2023.
Staffing Changes: Governor JB Pritzker announced that Deputy Chief of Staff for Equity Dr. Sekile Nzingai is stepping down. Her last day in the role is April 30.
Medicaid Redeterminations: As the COVID-19 public health emergency winds down, the Illinois Department of Healthcare and Family Services has begun the process of redetermining Medicaid eligibility. Medicaid redeterminations were paused for the past three years under the Continuous Coverage Requirement. Medicaid rolls swelled from 2.9 million prior to the pandemic to roughly 3.9 million today. Illinois estimates anywhere from 300,000 to 750,000 people could lose Medicaid coverage during the redetermination process.
Governor Pritzker promised there will be no “coverage cliff” in Illinois as Medicaid redeterminations begin. Instead, Illinois will use a rolling redetermination process through mid-2024. Pritzker warned that the first week of May is a critical time as the first round of recipients go through the resumed renewal process.
In the month of June, approximately 113,600 cases in Illinois are up for renewal. HFS was able to automatically renew 51% of Medicaid customers due in June. Read more here.
Immigrant Impact Task Force Report: The Illinois Immigrant Impact Task Force released a report examining various issues affecting immigrant, refugee, and limited English proficiency communities, sharing recommendations the state can take to improve services to immigrant communities. The Task Force identified thirteen issues in the legislation ranging from citizenship assistance, business development, education access, discrimination prevention, immigration detention, COVID-19 relief, language access programs, and more. Click for the full report.
Affordable Housing: The Illinois Housing Development Authority announced $15 million in available grant funding to support affordable housing and community revitalization efforts across the state. Available under the second round of IHDA’s Strong Communities Program, the initiative provides funding to units of local government and land bank authorities for the acquisition, maintenance, rehabilitation and demolition of abandoned residential properties in their communities. The program is designed to support local revitalization efforts and attract further investment in communities that may lack the resources needed to tackle vacant, abandoned and deteriorated properties.
A link to the application – including details on an informational webinar at 11 a.m. on Tuesday, May 16 – can be found here. Applications will be accepted through 3 p.m. on Wednesday, June 7, 2023.
Gubernatorial Appointments: Governor Pritzker appointed the following:
· James Connolly will continue to serve as a Member of the Illinois State Toll Highway Authority.
· Jacqueline Gomez will continue to serve as a Member of the Illinois State Toll Highway Authority.
· James Sweeney will continue to serve as a Member of the Illinois State Toll Highway Authority.
· Abel Kho will serve as a Member of the State Board of Health.
· Darryldean Marie Goff will serve as a Member of the Prisoner Review Board.
· Krystal Tison will serve as a Member of the Prisoner Review Board.
2024 Election Update: Republican businessman and philanthropist Rafael “Ray” Estrada of Galesburg announced he will challenge first term Congressman Eric Sorensen. The Republican National Committee is targeting this race.
City of Danville Votes to Restrict Abortion Access: On Tuesday, the Danville City Council voted to approve an ordinance that would bar the mailing of contraception and any “article or thing designed, adapted or intended for producing abortion.” The ordinance invokes the federal Comstock Act, an 1873 federal law that barred the mailing of contraception, “lewd” writing and every “article, instrument, substance, drug, medicine, or thing which is advertised or described in a manner calculated to lead another to use or apply it for producing abortion.”
Illinois Attorney General Raoul sent a letter to Danville’s Mayor arguing the proposal violates Illinois law that prevents units of local government from limiting abortion rights. It’s unclear how the local ordinance, which directly conflicts with Illinois law, could be legally enforced. Danville, located in East Central Illinois, has a population of roughly 30,000 residents. A last-minute amendment was added to the ordinance which states that it would only take effect “when the city of Danville obtains a declaratory judgment from a court that it may enact and enforce” the ordinance.
The ordinance also follows a recent announcement that an Indiana-based abortion clinic plans to relocate across the border into Danville.
Evidence Based Formula: The Center for Tax and Budget Accountability released a new report – Fully Funding the Evidence-Based Formula: FY 2024 Proposed General Fund Budget – which finds that Illinois’s K-12 funding formula remains short of its goal of ensuring every school in the state has the capacity to meet the educational and social-emotional needs of all children it serves.
According to the report, if Illinois continues its current rate of increasing its annual investment in the Evidence-Based Funding for Student Success Act, the legislation will not be fully funded in real, inflation adjusted terms until 2038, which is over a decade later than what the legislation calls for.
The EBF was passed by the Illinois Legislature in 2017. CTBA’s report recommends that the state’s annual increases in funding for the EBF grow from $300 million – $500 million. If the rate is increased accordingly, the EBF will be fully funded by 2031.