The Week in Review - September 30 - October 4

Budget

·         State budget picture improves.  The September 2013 monthly update on Illinois economic activity published by the Commission on Government Forecasting and Accountability (CGFA), the economic “think tank” maintained by the General Assembly, reports that General Funds revenue receipts for the first quarter of FY14 are tracking ahead of the receipts for the same period in FY13.  For the first three months of FY14, net General Funds receipts total $8.433 billion.  This total is $700 million higher than the FY13 total for the first quarter.  A primary reason for the increase in FY14 revenue receipts is a one-time spike in transfers in August from the Income Tax Refund Fund into the General Fund.  This one time transfer accounts for $397 million of the first quarter revenue growth.

Receipts from both the personal income tax and the corporate income tax have also seen growth compared to FY13.  Revenue from the personal income tax is up $205 million (net of refunds) and receipts from the corporate income tax are up $75 million (net of refunds).  Perhaps the strongest surprise in growth is due to the sales and use tax, which is up $139 million year to date.  Strong continued growth will be necessary to provide sufficient revenue to support the $35.446 billion appropriated in this year’s FY14 spending bills.  More information may be found at http://cgfa.ilga.gov/Home.aspx.


Concealed Carry
·         Headcount of approved concealed carry instructors surges.  The Illinois State Police reported as of Wednesday, October 2, that more than 860 instructors have been approved to carry out the training required for a license to carry a concealed handgun in public.  More than 1.6 million Illinois residents possess Firearm Owner Identification (FOID) cards and will be eligible, no later than January 2014, to apply for a concealed carry license.  The training may, for some applicants, require up 16 hours of instructional time in firearm basic skills and safety training; but persons who have taken a wide variety of gun-safety instruction earlier, including several courses offered by the National Rifle Association (NRA), will be granted the right to seek a partial waiver that will reduce their training time and instructional expenses. 

·         New concealed carry draft rules released.  In addition to the new instructor headcount, the State Police released new draft rules on Monday, September 30 to govern their implementation of the concealed carry program.  These rules are a necessary part of the countdown to January 2014, which is the mandated deadline set for full implementation of the concealed carry law. 

The new State Police rules have met some, but not all, of the concerns raised by gun advocacy groups, which saw an earlier version of these rules as lacking flexibility for experienced participants in shooting sports.  Concerned gun owners may want to look up the State Police’s website for further concealed carry information at http://www.isp.state.il.us/firearms/ccw/ and Frequently Asked Questions (FAQ) at http://www.isp.state.il.us/firearms/ccw/ccw-faq.cfm.

Downstate

·         House committee hears testimony from Archer Daniels Midland.  The hearing by the House Revenue and Finance Committee, held in Chicago on Tuesday, October 1, heard a plea from high-ranking executives of Decatur-based Archer Daniels Midland (ADM) for State help to maintain their global headquarters in Illinois.  The 30,000-employee firm, which had stated that it plans to maintain 4,400 jobs in its historic industrial-processing centers in Decatur, stated that their planning needs are moving the increasingly global firm to look at headquarters opportunities at or near a large metropolitan area with frequent air service.  ADM, the 27th-ranking firm on the sales-based “Fortune 500” list, reported sales of $89 billion worth of goods and services in 2012, including food, feed, and fuel products.

Economy

·         Bits of good news in most recent State economic report.  The Commission on Government Forecasting and Accountability (CGFA) budget and economic activity report for the first three months of Fiscal Year 2014 (FY14) contains some upbeat notes.   New Illinois car and truck registrations increased by 10.5% from July and by 13.7% from August 2012.  Purchases of new motor vehicles are not only a key indicator of consumer sentiment but also a driver of sales and use tax revenues to hard-pressed State and local budgets.  One of Chrysler’s most successful motor vehicle assembly plants is located in the Belvidere-based district of Representative Joe Sosnowski (R-Rockford).  These notes must be balanced against the State’s overall dismal (9.2%) jobless rate, depressed statewide labor force participation rate, and other indications of continued economic sluggishness. 

Energy

·         Energy production, new jobs near as fracking rules under discussion.  A new law passed by bipartisan majorities of the Illinois General Assembly directed the Department of Natural Resources (DNR) to work through the summer and fall of 2013 to develop the rules necessary to grant permits for enhanced shale drilling in Illinois.  Enhanced shale drilling, called “fracking,” centers on the injection of high-pressure water, sand, and chemicals into shale beds to open up the tight rock and release the trapped hydrocarbons. 

The New Albany shale, a thick, hydrocarbon-rich bed of sedimentary rock under large portions of southeastern and southern Illinois, could become a key future asset in U.S. production of oil and gas.  Representative David Reis (R-Olney), who played a key role in passage of the 2013 fracking law, represents a major portion of the New Albany oilfield.    

General Assembly

·         Governor files notice of intent to appeal court decision on legislative pay.  After Gov. Quinn vetoed the portion of the FY14 State budget meant to pay members of the General Assembly, Democratic legislative leaders filed a lawsuit against their own state party leader.  A decision by Cook County Judge Neil Cohen, reached Thursday, September 26, found in favor of the General Assembly on constitutional grounds – the State’s Constitution of 1970 contains language stating that legislators’ pay will not be changed during the duration of a General Assembly.  Gov. Quinn’s lawyers have filed notice of intent to appeal the decision.

Health Care

·         Confusion deepens as more than 100 health care plans to be offered to different Illinoisans.  The signup window for the federal Affordable Care Act (aka “Obamacare”) opened on Tuesday, October 1.  Various insurance firms are offering more than 100 plan choices, but none of these choices will be available throughout Illinois to all patients – all of them will be offered in specific geographic areas or to specific patient groups where the insurance providers have expertise at providing services. 

Uninsured Illinois residents will be required to use websites like “Get Covered Illinois” to find out which insurance plans they will be authorized to buy, but news reports indicate that this and other Affordable Care Act websites around the country were jammed and not fully accessible this week.  The Quinn administration has announced a $33 million taxpayer-funded initiative to “sell” the Affordable Care Act to Illinois residents and voters.  

The federal law will require all America legal residents to be covered by medical insurance no later than January 1, 2014.  Uncovered residents will face increasing penalties after that point, and these penalties will be levied on each American taxpayer’s tax returns through the federal income tax code.     


·         15,000 Medicare-eligible state retirees scheduled to be expelled from their health insurance program by January 1.  The decision by the Quinn administration to not include Champaign-Urbana-based Health Alliance on the list of health insurers admitted to the Medicare Advantage program is expected to require these retiree patients to select from plans offered by nationwide health giants Aetna, Humana, and United Healthcare.  

Especially affected are approximately 6,000 Champaign-Urbana-based retirees who have established doctor-patient relationships with the Carle health care system through Health Alliance.  The Carle system is not on the Medicare Advantage preferred provider lists of the three short-listed firms and persons in this category – including persons with multiple diagnoses and challenging medical conditions – may have to change physicians before January 1.

State Government

·         Federal shutdown leads to State layoffs.  Several State departments, such as the Illinois Department of Employment Security (IDES), Department of Military Affairs (Illinois National Guard), Department of Veterans Affairs (DVA), and the Illinois Emergency Management Agency (IEMA) are mandated by Washington, D.C. to carry out certain federal tasks that have been devolved, by law, to the 50 state governments to carry out.  These departments receive federal appropriations to carry out these tasks and designate some of their employees to do this work and be paid from federal funds.  As Washington has not passed a budget for fiscal year 2014 (FY14), a significant number of State employees are receiving layoff notices.  The federal fiscal shutdown occurred on Tuesday, October 1.   

Suburbs

·         Quinn, Pence reiterate support for proposed Illiana toll road.  In a joint appearance in Chicago on Friday, September 28, the governors of Illinois and Indiana endorsed the Illiana Expressway proposal, a joint project of the two states’ departments of transportation.  In order to minimize public taxpayer support, the proposed 47-mile roadway would be constructed and operated by the private sector as a toll highway.  The expressway would provide access through southern Will County between Illinois’ Interstate 55 and Indiana’s Interstate 65.  The Illiana project is facing scrutiny from land-use staff at the Chicago Metropolitan Agency for Planning (CMAP), who are questioning whether traffic on the proposed road will be sufficient to cover costs.