IVCA Provides Updates for State and Federal Legislative Issues

UPDATE provided by Stricklin & Associates on June 21, 2017:

The Illinois General Assembly is in Springfield today for a 10-day special session called by Governor Rauner.  Last night Governor Rauner made a televised address calling for unity and cooperation to resolve the budget impasse, to which legislative Democrats responded by saying they’ve been trying to do just that since the governor was inaugurated, each side essentially repeating their previously stated points of view.
 
The 20% so-called “privilege tax” in SB 1719, sponsored by Senator Daniel Biss and in the House by Representative Chris Welch, passed the Senate May 23 on a vote of 32-24-1.  It was approved by the House Revenue and Finance Committee on a partisan 7-4 roll call, and is on “second reading” with a June 30 deadline to pass the House.  Because it did not pass the House before May 31 and has an effective date of July 1 2017, it needs ⅗ vote to pass, requiring the support of all 67 House Democrats or some Republicans to pass, which we believe is a highly unlikely result.
 
The bill in its current form will be difficult for the House to approve, but we know from speaking with legislators it’s valuable for them to hear from you and to know of your opposition to this legislation!
 
We still recommend contacting the following members of the Illinois House:
 
Representative Deb Conroy- 217.782.8158 [email protected] 
Representative Lou Lang- 217.782.1252 [email protected]
Representative Anthony DeLuca- 217.782.1719 [email protected]bcglobal.net 
Representative Robyn Gabel- 217.782-8052 [email protected] 
Representative Laura Fine- 217.782.4194 [email protected]
Representative Scott Drury- 217.782.0902 [email protected] 
Representative Carol Sente- 217.782.0499 [email protected]
Representative Mike Zalewski- 217.782.5280 [email protected] 
Representative Elaine Nekritz- 217.558.1004 [email protected] 
Representative Jerry Costello- 217.782.1018 [email protected]
Representative Brandon Phelps- 217.782.5131 [email protected]
 
It is possible this proposal might be incorporated into a broader revenue package tied to a budget bill.  If that results in a resolution to the budget impasse, it will be difficult for many members of the General Assembly to vote against the entire package even if they oppose the “privilege tax”. 
The Senate Democrats passed their revenue bill (SB9) without the “privilege tax” and it is not included in the the Republican “Capitol Compromise” which makes specific changes to SB9.
 
No budget bills were sent to the Governor at the end of regularly scheduled session.  The Senate passed several measures of its ‘Grand Bargain’ with only Democratic votes, including gaming expansion, procurement reform, local government consolidation, a spending budget, and a revenue proposal.  The House did not take up the spending or revenue bills, and did not introduce its own proposals.
 
Last week, the Republican legislative leaders introduced a “Capitol Compromise”, a series of bills Governor Rauner has pledged to sign.  The package includes the amendments to SB9, local government consolidation, a 4-year property tax freeze, workers compensation reform, pension reform, and education funding reform.  The significance is this is the first time the Governor has stated explicitly which revenue measures he would support, and laid out in legislation the details of his ‘Turnaround Agenda’ items.
 
Senate Democrats responded saying they’ve already passed a balanced budget with some of the Governor’s reforms.  Speaker Madigan has expressed a similar sentiment as far as votes his members have taken.
 
Any budget passed in June, whether that be a full measure or a stopgap, will require a ⅗ vote, bipartisan cooperation and the support of the Governor.
 
A bipartisan group of legislators penned a letter this week stating they will not vote for a stopgap budget and will insist on a comprehensive plan.  The one budget bill which has been passed effectively every year under the Governor’s tenure has been K-12 funding, with neither party willing to risk the public reaction if schools are not open or are spending their reserves to stay open.  More and more we hear members of of both parties indicate they will not vote for the K-12 measure without a budget for the remainder of state government. If schools do not open on time or are forced to deplete reserves there may finally be sufficient public pressure to end the budget impasse.  Some school districts have stated they can hold out until the fall with their reserves, so this relieves some of the pressure for even a K-12 bill to be passed prior to July 1st.
 
Following the end of session without a budget, Illinois’ credit ratings declined further.  With both Moody’s and S&P downgrading the bond rating to just above junk status, at BBB-, and both agencies suggesting junk status is looming.  On top of this we face a $14.7 billion unpaid bill backlog.

Sample Email

Subject: Vote “no” on SB 1719

Dear Rep.______;

The incredible growth in entrepreneurial jobs in Chicagoland over the last 10 years is directly attributable to the availability of venture capital funding backing great entrepreneurs.

In 2016 alone, 251 companies located Illinois received $1.3 billion in venture funding. The Chicago Entrepreneurial Ecosystem is finally hitting on all pistons.

If SB1719 passes, it is virtually guaranteed that all Illinois-based venture funds will move. Illinois needs more investors in private companies, not fewer.  Why would a single VC stay in Illinois when ANY other location in the country is 20% less expensive?

As a constituent in your district and a citizen who recognizes our state needs to encourage businesses to stay here and continue to provide great jobs to citizens in Illinois – particularly recent graduates; I respectfully request that you vote no on SB1719.

Yours,
 
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