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Springfield Highlights

Springfield Highlights – Feb. 1, 2019

Minimum Wage Hike Alert

While the Illinois House was only in session for a few hours this week due to extreme cold weather that brought much of the State to a halt, the Illinois Senate managed nearly a full week of session and held a much-anticipated subject matter only hearing on minimum wage in the Senate Labor Committee.  The hearing consisted of several panels of advocates from both sides of the issue debating whether or not a minimum wage increase would benefit Illinoisans across the state or significantly harm the business sector and local governments like park districts.  While the Committee’s Democratic majority seemingly agreed that a minimum wage increase in Illinois is long overdue, there are still several outstanding issues that divide many members on both sides of the aisle.  One key issue in question is whether or not Illinois should have a tiered minimum wage based on geography.  This idea would set different minimum wages for Chicago, Cook and the collar counties, and “downstate” Illinois.  The argument has been made that the cost of living in Chicago is far greater than downstate and that a higher minimum wage may make sense in Chicago when it might not make sense in a community like Springfield.  The concept of tiered minimum wage is not without precedent, as both New York and Washington currently have different minimum wages in different parts of the state.

The Illinois Manufacturers’ Association, along with the general business community, are opposed to the massive 82 percent hike in the state’s minimum wage.  However, with Governor JB Pritzker and supermajority Democratic leadership in the General Assembly in favor of the wage hike, something will pass this session. Business groups are working to try and mitigate the impact on employers.

A key issue is how long of a phase in would be needed for full implementation of a minimum wage.  Currently, some lawmakers and labor unions are seeking a four-year phase in which would mean average increases of more than $1.50 per year; industry groups have stated that there would need to be a phase in of at least seven years.  Also being discussed is whether a minimum wage bill should include language to preempt local governments from imposing higher wages or other labor regulations (restrictive scheduling, paid leave, etc.) that are above and beyond state laws.  Some have argued that without preemption, a minimum wage comes with no assurances that wages won’t continue to rise in communities like Chicago.

Lawmakers have discussed the potential of a tax credit for businesses to help offset the cost of an increased minimum wage.  The most recent proposals include a limited credit for small employers with less than 50 employees, but several legislators alike say that the credit should be expanded to include more businesses with more employees.

Governor Pritzker, who campaigned heavily on an increased minimum wage, is encouraging the General Assembly to act swiftly on passing minimum wage legislation to get it on his desk before his Budget Address on February 20.  The issues highlighted above may slow down the process.  When language does move, it is expected to be filed on SB 0001, which is a minimum wage shell bill that sits on Second Reading on the Senate Floor.

The IMA sent out an alert to member companies and we encourage you to contact your lawmakers to let your voices be heard.

Governor Pritzker Makes More Staff Announcements

Governor Pritzker continues to slowly introduce new staff and Agency executives as his administration comes together at a pace that has surprised many.  Here are some additional announcements:

  • Dr. Ngozi Ezike will serve as Director of the Illinois Department of Public Health.  Dr. Ezike is a board-certified internist and pediatrician who currently serves as Medical Director at the Cook County Juvenile Detention Center, the largest juvenile detention facility in the country.
  • Jaime E. Martinez will serve as Director of the Illinois Department of Veterans’ Affairs.  Martinez currently serves as Executive Director of Illinois Joining Forces, a statewide nonprofit and public-private partnership that brings services and support to veterans at the community level.
  • Ramon Gardenhire will serve as Deputy Chief of Staff for Policy in the Office of the Governor.  Gardenhire currently serves as the vice president of policy for the AIDS Foundation of Chicago.
  • Pat Collier will serve as Deputy Chief of Staff for Federal Affairs in the Office of the Governor. Collier previously served as policy director on Governor Pritzker’s campaign.

List of New Legislation Continues to Grow

With nearly 3,000 bills and resolutions filed in the House and Senate, the number of bills that could possibly affect industry continues to grow.  Here are a sample of bills that were filed this week:

HB 0936 (McSweeney-R) – Creates a tax deduction for business entities in an amount equal to 100% of the portion of the taxpayer’s Illinois net income for the taxable year that is earned by the taxpayer as a result of a manufacturing process.

HB 1454 (Bourne-R) – Repeals the estate tax.

HB 1470 (Flowers-D) – Requires warranties on medical devices that would result in manufacturers being liable for all costs to the patient for the replacement of each medical device if the medical device malfunctions due to no fault of the patient. 

HB 1478 (McCombie-R) – Creates the Manufacturing Job Destination Tax Credit that provides a credit of 25% of the Illinois labor expenditures made by a manufacturing company in order to foster job creation and retention in Illinois.

HB 1562 (Guzzardi-D) – Requires the consent of every single mineral interest owner before fracking may begin.

HB 1582 (Williams-D) – Attempts to thwart net neutrality at the federal level by providing for a state approach to regulating the internet.  Creates the Broadband Procurement and Disclosure Act to provide that no State broadband purchaser may award any contract to an Internet service provider that includes broadband service unless the contract provides specified terms concerning access to and impairment of Internet services.

SB 0123 (Morrison-D) – Makes the research and development tax credit permanent.

SB 0163 (Castro-D) – Provides for an anti-wage theft policy that would increase penalties on businesses that do not pay employees their full wages in a timely manner.

SB 0203 (Hutchinson-D) – Provides for a state-to-state contract where each state agrees to not offer company-specific subsidies for companies currently located in or considering locating in the member state, including, but not limited to, for corporate headquarters, manufacturing facilities, office space, or other real estate developments.

SB 0216 (Bertino-Tarrant-D) – Creates an income tax credit for qualified education expenses incurred by employers on behalf of qualifying apprentices.

IMA Files Critical Infrastructure Protection Bill in Collaboration with AFL-CIO

This week, Assistant Majority Leader Jay Hoffman (D-Belleville) filed a joint initiative of the IMA and AFL-CIO that looks to protect Illinois’ critical infrastructure.  The legislation creates a new criminal penalty for damage to critical infrastructure for a person who knowingly damages, destroys, vandalizes, defaces, or tampers with equipment at critical infrastructure facilities  As determined by the federal government in 2013, critical infrastructure includes such things as energy facilities, ports, railroads, military facilities, pipelines, dams, water systems, telecommunication facilities, refineries, and critical manufacturing facilities.  These facilities must be enclosed by fencing or clearly marked with signs prohibiting trespassing. 

This legislation goes on to add criminal conspiracy to the protection of critical infrastructure, in that conspiring organizations responsible for any damage will be held liable.  Most importantly, while protecting critical infrastructure, the legislation also protects one’s right to assemble, protest, and have demonstrations.  The bill also allows ensures that a unions ability to engage in activities such as picketing are not infringed upon.

Step Forward: Illinois & IMA Women’s Manufacturing Council

The IMA in concert with National Association of Manufacturers’ Manufacturing Institute & BKD will be hosting the first ever STEP Forward: Illinois program on February 21 in Schaumburg.  The STEP Forward: Illinois program is a half day program designed to bring together dynamic women making an impact in manufacturing from across the State to build networks, drive collective thinking around increasing manufacturing career opportunities, increase awareness of manufacturing within younger generations, and bridge the skills gap in our local communities. Through an industry-based panel discussion, the program will tell the stories of real women who represent the changing faces of manufacturing.   This event will also kick off the IMA’s new Women of Illinois Manufacturing Council that will serve as an education and networking opportunity for women leaders.   Registration is now open for the Step Forward: Illinois program and is free to participants. 

IMA Business Day

As a reminder, the IMA’s Business Day at the Capitol is Wednesday, May 1st.  It is the largest gathering of business leaders at the Capitol and we sell out year after year.  Mark your calendars and plan to attend or sponsor IMA Business Day!